There are concerns about how employers view degrees from these institutions.
As the cost of higher education continues to climb, the promise of a "low-cost" or "tuition-free" online degree can sound like a dream come true for prospective students. These programs offer significant savings and the flexibility to learn at your own pace. However, despite their appeal, they may also have hidden costs and less prestige than traditional institutions.
In 2024, the average annual tuition cost was $48,591 for students at private universities, $29,454 for out-of-state students at public universities, and $12,308 for in-state students at public universities.
By contrast, low-cost universities charge less than $10,000 in tuition per year, and tuition-free universities charge none at all.
While traditional universities often charge tens of thousands of dollars annually, a growing number of online institutions offer dramatically lower-cost alternatives, relying heavily on state or donor funding and affordable online or hybrid teaching models. For example, many tuition-free programs substitute some or all live instruction with prerecorded videos, lightening instructors' workloads. They may also cut costs by teaching a limited choice of majors and not offering research programs or extracurricular activities like sports.
For instance, University of the People is a tuition-free, accredited nonprofit that charges only administrative fees, totaling about $6,400 for a four-year undergraduate degree. Western Governors University, another fully online institution, offers a flat-rate tuition model averaging around $8,300 per year for undergraduate degrees. Meanwhile, Calbright College, a public, online community college in California, offers free programs to state residents, including waived tuition, fees, and technology costs.
These models illustrate the diversity of pricing strategies among low-cost schools and the importance of reading the fine print, as many "tuition-free" programs still charge for assessments, materials, or support services.
Low-cost and tuition-free online schools can offer a compelling path to a degree, especially for students seeking affordability and the ability to do their coursework around their work hours.
However, these benefits must be weighed against potential drawbacks like limited program offerings, hidden fees, and questions of recognition and prestige. As with any investment, prospective students should carefully evaluate whether these programs align with their academic goals, career aspirations, and financial circumstances.