Fewer parents can pay the bulk of college tuition
07/23/2013 3:51 PM
07/23/2013 3:51 PM
Grants and scholarships are taking a leading role in paying college bills, surpassing the traditional role parents long have played in helping foot the bills, according to a report from loan giant Sallie Mae.
Since the recession, more college-bound students have eliminated schools from their searches based on costs and have relied less on their parents once they get to campus, the report said. Worries such as tuition increases and job losses seem to have faded as the economy has improved, yet parents and students still decide on schools, majors and work schedules based on the price.
“We have moved into a post-recession reality in how people pay for college,” said Sarah Ducich, Sallie Mae’s senior vice president for public policy.
College spending per student was about $21,000 during 2012, down from a peak of $24,000 in 2010, according to the Sallie Mae-Ipsos Public Affairs report.
The annual survey of student financial aid found that students earned about $6,300 in grants and scholarships to pay for college costs, taking the top spots from parents. Student loans were the third most common source to pick up the bill for courses, housing and books.
The average student borrowed $8,815 in federal loans.
Last year, the average family turned to grants and scholarships to cover 30 percent of college costs. Parents’ income and savings covered 27 percent of the bill and student borrowing covered 18 percent.
Parents’ enthusiasm for college has not shriveled, though. The survey found that 85 percent of parents saw college bills as an investment in their children’s future.
One-fifth of parents added work hours to pay for college and half of students increased their work hours. The report found 57 percent of families said students were living at home or with relatives, up from 41 percent last year and 44 percent in 2011.