According to the College Board, college costs in the United States are on the rise. From the 1999-2000 academic year to the 2009-2010 academic year, on average the published tuition and fees at public four-year colleges and universities increased by 4.9% each year above and beyond general inflation.

IN PICTURES: 8 Financial Tips For Young Adults

For the 2009-2010 academic year, published in-state tuition and fees at public four-year institutions rose 6.5% from the previous academic year to $7,020. Tuition and fees for out-of-state students displayed a similar trend, rising approximately 6.2% to $18,548.

With stats like these, it may be hard to believe that in some countries you can still be educated for free. Countries offering a free education include Sweden, Cuba, Brazil, Argentina, Norway, Finland, Chile and Denmark.

In order for something as valuable as higher education to be provided for free, the cost has to be recovered from somewhere. Here are some of the potential drawbacks of having a free education.

Don't Forget the Other Costs
Some countries waive tuition, but have fees and other costs including books and materials, food, housing and transportation. For instance, in Ireland, tuition is free for undergraduate courses longer than two years, but average fees (registration, administrative, etc.) can be in the neighborhood of 1,500 euros.

In Argentina, many students have jobs, some full-time, while attending college to cover their other expenses. The jobs provide income and experience, but can also make for a difficult balancing act between education and work.

Sweden, on the other hand, actually provides students with a monthly allowance to cover such costs. (For some helpful tips for college budgeting, check out A Foolproof Budget Plan For Textbooks.)

High Taxes
When comparing tax rates by country (as calculated by total tax revenue as a percentage of GDP) it is no surprise that several of these countries are near the top of the list. In fact, Denmark, Sweden, Cuba, Finland and Norway are five of the top ten countries.

For instance, in Sweden, tax revenue funds studies at the university level. Estimates place the top income tax rate in Sweden at approximately 57%. According to the Swedish National Agency for Higher Education, in 2008, the higher education institutions brought in approximately SEK 50.1 billion in revenue.

Quality of Education
According to the Times Higher Education - QS World University Rankings, Ireland is the only nation on this list with a school that ranks within the top fifty universities. Trinity College of Dublin was the highest ranking university from a country that provides tuition free education; Trinity tied with Osaka University for the #43 spot on the annual list.

The top 16 spots are all held by schools in the United States and the United Kingdom, two of the most expensive countries when it comes to pursuing higher education. (For more, see Pay For College Without Selling A Kidney.)

Cost of Living
Oslo, Norway (home to the University of Oslo) has one of the world's highest costs of living, with an estimated cost of living index of 152.85. New York City is the base of the index, so Norway has a CPI that is 52.85% higher than that of New York City. Copenhagan, Denmark also ranks high with a CPI of 138.91, while Dublin, Ireland and Helsinki, Finland came in with CPIs of 120.79 and 113.91 respectively. (To learn more, see Economic Indicators: Consumer Price Index (CPI).)

The Bottom Line
The benefits of a free education are undeniable, but there is no such thing as a free lunch. Having the burden of tuition removed, is a huge benefit which may be offset by non-educational costs. Remember to consider other costs before heading abroad to further your education.

Catch up on your financial news; read Water Cooler Finance: Goldman Fined, Financial Fixes And Apple's "Apology".

Related Articles
  1. Investing Basics

    Explaining Trade Liberalization

    Trade liberalization is the process of removing or reducing obstacles that impede the exchange of goods and services between nations.
  2. Mutual Funds & ETFs

    ETF Analysis: iShares MSCI South Africa

    Learn more about the iShares MSCI South Africa fund, which is an NYSE-listed exchange-traded fund offered and managed by BlackRock.
  3. Savings

    6 Ways to Save Money on College Supplies

    Tuition and room and board are big expenses, yes, but the cost of textbooks and supplies can add up, too, unless you strategize.
  4. Mutual Funds & ETFs

    ETF Analysis: iShares MSCI EAFE Small-Cap

    Read an in-depth analysis of the iShares MSCI EAFE Small-Cap Fund, a well-managed exchange-traded fund that tracks small-cap international stocks.
  5. Mutual Funds & ETFs

    ETF Analysis: Vanguard Global ex-US Real Estate

    Take an in-depth look at the Vanguard Global ex-U.S. Real Estate ETF, an international property fund tilted toward Asian markets.
  6. Economics

    Is the Yuan a Yawn or a Nightmare for Investors?

    China’s decision to change the method of setting its currency exchange rate caused global shock waves last week.
  7. Mutual Funds & ETFs

    ETF Analysis: iShares International Select Dividend

    Learn how the iShares International Select Dividend ETF provides investors an opportunity to gain exposure to high-quality companies outside the United States.
  8. Economics

    Signs of a Struggling Economy?

    Last week was another difficult one for stocks, marked by a bruising mid-week selloff triggered by China’s surprise devaluation of its currency. 
  9. Stock Analysis

    Looking to Invest in China's Fast Food Industry? Try KFC

    Read about the fast food industry in China, and learn what makes KFC the dominant brand in a market poised for years of high growth.
  10. Investing

    Is Lenovo an Example of the New China?

    From modest beginnings, Chinese computer firm Lenovo has become the number one provider of personal computers in the world. But does this represent the new China?
RELATED TERMS
  1. Brazil, Russia, India And China ...

    An acronym for the economies of Brazil, Russia, India and China ...
  2. Good Student Discount

    An auto insurance policy discount available to young drivers ...
  3. Duty Free

    Goods that international travelers can purchase without paying ...
  4. Optimal Currency Area

    The geographic area in which a single currency would create the ...
  5. European Sovereign Debt Crisis

    A period of time in which several European countries faced the ...
  6. Whartonite

    A graduate of the Wharton School of Business at the University ...
RELATED FAQS
  1. Can I use my IRA to pay for my college loans?

    If you are older than 59.5 and have been contributing to your IRA for more than five years, you may withdraw funds to pay ... Read Full Answer >>
  2. Can I use my 401(k) to pay for my college loans?

    If you are over 59.5, or separate from your plan-sponsoring employer after age 55, you are free to use your 401(k) to pay ... Read Full Answer >>
  3. What is the difference between comprehensive income and gross income?

    Comprehensive income and gross income are similar, but comprehensive income is a specific term used on a company's financial ... Read Full Answer >>
  4. What tax breaks are afforded to a qualifying widow?

    The tax breaks accorded to qualifying widows or widowers include being able to use a tax filing status that allows for a ... Read Full Answer >>
  5. What are the best MBA programs for corporate finance?

    Opinions vary based on which publications you consult, but the best MBA programs for a career in corporate finance are at ... Read Full Answer >>
  6. How is income taxed on prorated salary?

    Since yearly income is viewed by the Internal Revenue Service (IRS) as the total amount of income a person has made over ... Read Full Answer >>

You May Also Like

Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!