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Private vs. Public College: The Pros & Cons of Both

May 14, 2019 · 5 minute read

We’re here to help! First and foremost, SoFi Learn strives to be a beneficial resource to you as you navigate your financial journey. Read more We develop content that covers a variety of financial topics. Sometimes, that content may include information about products, features, or services that SoFi does not provide. We aim to break down complicated concepts, loop you in on the latest trends, and keep you up-to-date on the stuff you can use to help get your money right. Read less

Private vs. Public College: The Pros & Cons of Both

No matter what you ultimately plan on doing with your life, choosing a college is a pretty big deal. Plain and simple, where you go to school can have a big influence on the rest of your life, not to mention your career opportunities after graduation.

It also can be an expensive investment, with Americans spending around $30,000 per student each year, just about twice as much as the average for developed countries. For all these reasons, it’s worth thinking carefully about which institution is the best fit for you.

One of the biggest choices to make is whether to attend a private vs. public college. A key difference between private and public colleges lies in how they are funded and operated. Public colleges get much of their funding from local and state governments, while private ones are largely sustained with tuition, fees, and donations.

Going the public route is by far the most common scenario: As of 2016, around 13 million undergraduates were enrolled in public institutions, up by 4% since 2010. In the same year, just 3.7 million college students attended private colleges and universities, either for-profit or non-profit.

Now we’re going to get into more about potential advantages and drawbacks of each choice. Before we do, we should mention that even though we’re calling out a few colleges and universities by name—shout out to them—we’re not affiliated or endorsed by any of the institutions. Just FYI. Alright, let’s talk about the differences between public and private colleges.

The Cost of Public vs Private Colleges

One reason that attending public colleges is the more popular route is that they are often less expensive than private institutions. In the 2015 to 2016 academic year, the average cost of tuition, fees, and room and board at a public college was $16,757 .

That was less than half the average cost of private non-profit schools ($43,065 ) and significantly less than the average price of private for-profits ($23,776 ). However, it’s worth noting that this price tag for public institutions had increased by more than one-third in the previous decade, and that the costs rose faster than for private nonprofit institutions in that time period. So public colleges may no longer be such a good deal if the trend continues.

Public institutions are often especially affordable for in-state students, who typically get a break on tuition. For example, in the 2017-2018 school year, average annual tuition and fees (not including room and board) for public schools was $9,970 for in-state students, but $25,620 for out-of-state students.

That said, private colleges and universities may also offer scholarships, fellowships, and other kinds of need- or merit-based financial aid. And, even some top-tier universities have virtually done away with tuition for students whose families have certain levels of family income. So high-achieving students might actually get a better or comparable deal at a private institution depending on their family’s financial situation.

Differences in Educational Quality

The highest ranking public schools in the country include UCLA, UC Berkeley, the University of Virginia, the University of Michigan (Ann Arbor), and UC Santa Barbara. At these schools and many others, you get a top-notch education at a relative steal if you qualify for in-state tuition.

However, many public schools have enormous student populations, which can mean large class sizes, difficulty getting into your most desired classes, and less personal attention from faculty and administrators. For example, the University of Central Florida has nearly 57,000 undergraduates, resulting in a student-to-faculty ratio of 30 to 1.

By comparison, Pomona College in Southern California has a population of around 1,500 students and a student-to-faculty ratio of just seven students to one faculty member. Beyond class size, some private institutions are often able to deliver a world-class education; every one of the top 10 highest-ranking schools in the country are all private schools.

Note that there can be a big difference between private non-profit schools and for-profit schools. Most of the prestigious private universities you’re familiar with, like Harvard and Princeton, are non-profits. For-profit schools have been on the rise, with undergraduate enrollment growing by 127% from 2000 to 2016.

But only about a quarter of students at for-profits graduate in six years, compared to nearly 60% at public schools and 66% at private non-profits. Meanwhile, many students who attended for-profit institutions are stuck with large amounts of student loan debt .

Campus Life

For some students, the large size of many public institutions is another attraction. This environment means there are a great variety of potential groups to join, activities to participate in, or classmates to become friends with.

A large school means many different classes and majors to choose from. Private schools, on the other hand, are likely to have students from more parts of the country and world. If this appeals to you, it can expand your network and make your college experience much more interesting.

Both public and private schools can be a great choice for students interested in athletics. Public schools are most likely to have a wide variety of active sports teams, and most of the top-ranking colleges for student athletes are public.

However, many private universities have successful teams, as well. If it’s important to you, or you’re a student athlete yourself, you could check out the strength of specific sports program at the colleges you’re considering.

Financing Your Education

Planning ahead for how to make your education affordable is just as important as deciding which school to attend. One obvious way to cover the cost is to save up money. Because it’s such a large chunk of change, however, your parents or other loved ones would likely have had to save for years to come close to paying for college completely.

But even if you or your parents save a bit, any amount can help make a dent in your expenses and in reducing the amount you take out in student loans. Another way to save is by cutting your expenses during college, perhaps by living with roommates or at home, or choosing a lower-cost institution.

Beyond saving, you can also look for opportunities to receive “free money” in the form of grants or scholarships. The federal government offers Pell Grants for low-income students , and many states, corporations, and colleges offer scholarships tailored to specific groups of students. If work study is part of your financial aid package, that’s another way to help pay your tuition.

This federal program offers eligible students part-time jobs, usually on-campus. If you don’t qualify or can’t get enough hours, you can always look for a different part-time job on your own. Many colleges have an internal job board, which can be a great way to suss out better-quality gigs.

For most people, taking out student loans is a necessary part of making college possible. These days, 70% of undergraduates graduate with student loan debt, and the average borrower finishes school owing $37,172 .

After filling out a Free Application for Federal Student Aid (FAFSAⓇ), you’ll find out which types of federal aid you qualify for and how much you or your parents can borrow.

For the 2019 to 2020 academic year, interest rates on federal loans range from 4.53% to 7.08%. And the federal loan limit for first-year undergraduates is $5,500.

If you still need additional funding, a variety of lenders offer private educational loans. Private student loans have a lot of similarities to federal loans, though the repayment plans, qualification criteria, and interest rates are different.

Private student loans typically take your credit history into consideration—or your cosigner’s, should you choose to apply for student loans with a cosigner. And while federal student loan interest rates are always fixed, private student loan interest rates can be fixed or variable. (Fixed means the rate will stay the same over the course of the loan, while variable rates can change based on market fluctuations.) If possible, you should exhaust your federal aid options before seeking private student loans.

SoFi Private Student Loans

SoFi’s private student loans have absolutely no origination or late fees. You (and potentially your cosigner) can fill the application out entirely online. And when it comes time to repay your private student loans, SoFi offers flexible repayment options and exclusive member benefits.

Heading off to college soon? Learn more about SoFi private student loans.


External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.

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SoFi loans are originated by SoFi Lending Corp (dba SoFi), a lender licensed by the Department of Business Oversight under the California Financing Law, license # 6054612; NMLS # 1121636 . For additional product-specific legal and licensing information, see SoFi.com/legal.

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