Sallie Mae, the nation’s number one financial services company specializing in education, in conjunction with Ipsos, has released a new national study, "How America Pays for College 2013."
The study’s findings were based on survey results from around 800 undergraduate students, between the ages of 18 and 24 years old and the parents of undergraduate students.
According to the study, families have adjusted to the post-recession when it comes to paying for school, using grants and scholarships
to fund the rising college costs.
, classified as “free money”, now funds a larger portion of college costs than it has in the past. Utilizing scholarships
and grants to cover college costs rose to 30 percent, from the 23 percent reported in the 2010 study.
Previously, parents’ income and savings were the leading resource of funding for school at 37 percent. That percentage declined in 2013 and is currently the second source of funding at 27 percent.
“Parents are willing to stretch themselves,” said Sarah Ducich, Sallie Mae’s
senior vice president for public policy in a recent AP article
. “It’s not that they’re not willing to pay. It’s that their income is not keeping up.”
followed as the third source of school funding at 18 percent.
Despite rising college costs, the study found that the average family is actually spending less on college by taking steps to ease the burdens of college costs. This has been done through two routes: “making college more affordable” and “making ends meet.”
Families have started to make college more affordable by having students live at home (57 percent), eliminating schools based on cost (67 percent) and accelerating coursework to spend less years attending school (27 percent).
They’ve also tried to make ends meet through both students (60 percent) and parents (48 percent) reducing their overall spending, along with both parents (20 percent) and students (47 percent) working more hours to pay for college.
“It forced them to adopt new behaviors of savings and ways to find nickels and dimes,” said Cliff Young, managing director at Ipsos in a recent AP article
The following is the breakdown of the sources a typical family utilized to pay for college:
– Grants and scholarships
– Parent income and savings
– Student borrowing
– Student income and savings
– Parent borrowing
– Relatives and friends
Families are also taking measuring to reduce debt amounts, with a reported 22 percent working to repay student loans while students are still in school.
Regardless of the struggles paying for school parents may experience, 85 percent still strongly agree that college was an investment in their child’s future – the highest percentage within the last five years.
Is the breakdown of how you pay for school the same as the study?