The majority of parents in a survey, especially those with low income, did not begin researching ways to pay for college until after their child entered high school. The survey of 400 parents with at least one child entering college as a freshman in 2005 found that 57% of parents waited until their child was in high school before researching ways to pay their childs tuition. Among parents making less than $50,000 a year, 71% waited until their child was in high school before researching and 9% did not conduct any research into financing college. The survey was sponsored by Academic Management Services.
Despite procrastinating on research, parents had a pretty good idea about how much grant and loan aid they would receive to pay for college, although lower-income parents tended to slightly underestimate grant aid and overestimate loan aid.
Only 21% of respondents making less than $50,000 expected scholarships and grants to cover 61% to 100% of their college costs, but 33% thought scholarships and grants would cover 61% to 100% of costs. In contrast, 37% of lower-income parents predicted that 41% to 100% of the costs would be covered by loans, but only 24% used loans to cover that percentage of tuition costs.
In comparison, 38% of all parents thought scholarships and grants would cover 41% to 100% of tuition, which was accurate for 37% of them. Similarly, 16% of all parents expected loans to cover 61% to 100% of tuition costs and this was true for 15%.
Only 15% of the parents surveyed said that cost was the top priority they considered when their child applied to colleges. However, 20% said that scholarship availability was their top concern. Location was the top priority for the greatest number of parent (28%) and 18% said admissions ranking was their top concern.
The survey also found:
- Two-thirds of parents at all income levels contacted a financial aid office with questions.
- Parents and students shared loan burdens, 29% said parents borrowed more and 29% said students borrowed more.
- Two-fifths of parents said their child took out Stafford Loans with slightly more lower-income families (43%) relying on Stafford Loans than families making $75,000 and more (39%).
- Only 13% of families used PLUS loans and the same percentage used private student loans.
- Approximately 20% of families used a monthly tuition payment program, with more higher-income families (24%) using the program than lower-income families (19%).
By Haley Chitty
NASFAA Assistant Director for Communications
Posted January 27, 2006 on www.NASFAA.org, the Web Site of the
National Association of Student Financial Aid Administrators (NASFAA).
Copyright 2006. Redistribution to non-NASFAA institutions is prohibited
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