When it came time for Cassidy Rumble to choose a college, she had a range of options thanks to great SAT scores, a solid grade point average and a stellar volunteer resume.

But when it came to mulling over elite universities, Rumble looked at the bottom line, which for private four-year colleges now average over $27,000 a year in tuition and fees alone.

That helped convince the 19-year-old to attend the more modestly-priced Evergreen State College in Olympia, Washington.

“The cost difference was tremendous,” says Karen Rumble, Cassidy’s mom. “Add to that the expense of travelling back and forth, and we’re saving at least $20,000 a year compared to the Ivy Leagues. In the end, we didn’t look at anything except state schools.”

More families these days are making the same choice.

In 2011, almost 40 percent of high-income families opted for other colleges after looking at the financial aid package, up from 32 percent in 2010, according to a report by Sallie Mae on college spending.

And that’s creating a new set of problems, with public institutions that are often bursting at the seams. Maybe you’ll take state college – but will they take you?

“Applications have been going up, and enrollment has surged in many places,” says Dan Hurley, director of state relations and policy analysis for the American Association of State Colleges and Universities. “It’s putting a lot of strain on the system, with severe capacity issues and funding declines in many states. In California, for instance, they’re capping freshman enrollments, and turning hundreds of thousands of students away from community colleges.”

Indeed, California’s state system received a whopping 621,000 undergrad applications for this year’s fall term. Those swelling figures have been fuelled by unemployed older students, Hurley says, as they return to college in search of new skills and credentials. Those applicants tend to opt for public institutions, which charge a relatively affordable average of $7,605 a year for in-state students, according to the College Board.

As a result, state and community colleges are learning how to manage their soaring popularity. If they used to sit by the phone, waiting for it to ring, now everyone’s asking them to the prom at once.

Just ask Lee Wilber, a 22-year-old who goes to Missouri State. He transferred from the University of Hawai’i to take advantage of lower tuition and living costs, saving more than $20,000 a year in the process. But he says that the jostling to get into required classes has become a virtual bloodsport.

“I’ve definitely noticed an increase in the competition for space within classes,” says Wilber. One example: A required course that’s now only offered online, to help deal with massive student demand. “It’s turned what would be a normal course in terms of time and workload, into a nightmare of long hours and technical difficulties,” he says. “I’m dropping the course in the hopes of taking it in a classroom setting – which may result in taking an additional semester to graduate. Let me get out my checkbook.”

The New Normal, it seems, has come to higher education. So how can students adapt and thrive in a changing environment? A few tips for families who are weighing their educational options:

Apply early and often

Now is not the time to have all your hopes riding on one institution, which may be groaning with record enrollment and/or facing crippling budget cuts. Apply to an array of colleges, at different price points, so your family has maximum flexibility when making the final financial call.

Remember that not all state colleges are created equal

Your choice may be determined by where you live, since in-state students benefit from hefty discounts. But make sure to do some serious comparison shopping, by checking out rankings like The Princeton Review’s Best Value Colleges. Among public institutions, the University of Virginia snared the top slot for 2011, followed by the New College of Florida, the University of Florida, State University of New York at Binghamton, and the University of Georgia.

Don’t rule out private universities

Yes, the figures for private education look daunting. But consider that for some elite institutions, their massive endowments allow qualified students from low- or middle-income families to enjoy a full ride. “For those students, going to Harvard can actually be less expensive than going to a local state college,” says Tony Pals, communications director at the National Association of Independent Colleges and Universities.

Leverage new affordability measures

Colleges are keenly aware of how rising costs have been impacting family budgets, which is why both private and public institutions have been rolling out some innovative new programs. From three-year degrees, to tuition freezes, to boosted student aid (like replacing loans with outright grants), make sure to explore every fresh avenue that will ease your financial burden down the line.

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