Paying for College

A significant change in President Obama's college ratings plan

Last August, we shared President Obama's plan to rate colleges and universities nationwide on their ability to offer an affordable education to students. The plan proposed tying each school's rating to the amount of financial aid funding it received from the federal government. As of last Thursday, the plan has been altered significantly.

Instead of rating each college and university on their affordability factor, the Department of Education will provide federal data on topics such as tuition and financial aid for families to make their own judgments. A new college ratings tool will allow parents and students to review information on college cost and outcomes for schools nationwide in order to develop their own opinions about the financial feasibility and value of each one. The resource should be available by the end of the summer.

The decision to abandon the original ratings plan is the result, in part, of feedback from the higher education community, who expressed concern that the proposed ratings system could not fairly and accurately evaluate the financial value of each school, thus providing incomplete information and generating more questions from students and parents. The new ratings tool will aim to equip families with the data needed to make wise financial decisions, something the Department of Education has been working on over the past few years.

As the development of this new tool progresses, watch this space for important announcements of its availability to the public. And to read more about the reasoning behind this decision, visit the Department of Education blog here.