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Survey: Students, Parents Increasingly Conscious of College Cost

By Allie Bidwell, Communications Staff

Over the last decade, the percentage of students seeking financial assistance for college has steadily increased, as students and families have also become more sensitive to the cost of college. Meanwhile, scholarships and grants are making up a noticeably larger share of how students and families pay for college, according to a new report.

In its 10th annual "How America Pays for College" report – based on a survey conducted by Ipsos – Sallie Mae found that in the most recent academic year, 2016-17, families paid roughly the same amount for college as in the previous year, but that the balance of how they pay has shifted. Scholarships and grants on average paid for about 35 percent of college costs – the largest share in the past decade, according to the report. Nearly half of all families used scholarships (49 percent) and grants (47 percent) to help pay for college last year.

After scholarships and grants, parents funded the next largest share of the cost of college through their income and savings, which covered 23 percent. Parent borrowing paid 8 percent. Meanwhile, students' income and savings on average covered 11 percent of the cost of college, and student borrowing paid 19 percent. Another 4 percent of the cost came from relatives and friends.

The survey, which is based on answers from 800 parents of undergraduate students and 800 undergraduate students between 18 and 24, also asked participants about their views on the value of a higher education, how cost factors into their decisions, and what they are doing to make college more affordable.

"Throughout our 10 years of conducting this study, families have consistently demonstrated they are determined to make college happen, and they've also become more value-conscious as they pay for higher education," said Raymond J. Quinlan, chairman and chief executive officer of Sallie Mae, in a statement. "The value families place on a higher education degree is so strong that the majority expect their child to achieve a graduate degree."

The report said that parents and students have consistently over the last decade said their primary reason for attending college is because it is "an investment in the student's future."

Still, families appear to have become more conscious of the cost of college. In 2008 – the first year of the survey – 58 percent of families ruled out a particular college due to the cost. This year, that number rose to 69 percent. More families are also applying for financial aid. Filing rates for the FAFSA increased from 74 percent in 2008 to 86 percent this year.

Almost all families – 98 percent – are also looking for ways they can lower the cost of college, such as by choosing an in-state school, living at home, adding a roommate, or increasing their work hours, for example. About 1 in 5 students (18 percent) also changed majors to pursue "a more marketable profession," the report said.

"Finding the resources to pay for college can be challenging for American families, but they are willing to undertake that challenge because of the value they place on the opportunity higher education offers," the report said.

 

Publication Date: 7/21/2017


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