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Families are Tapping More Scholarships and Grants to Pay for
College
Special to The Truth
Families spent less
out-of-pocket for college in academic year 2015-16 compared
to last year, as they took advantage of more scholarships
and grants to foot the bill, according to “How America Pays
for College 2016,” the national study from Sallie Mae, the
country’s largest private student lender, and Ipsos, a
global independent market research company.
Scholarships and grants
covered 34 percent of college costs, according to the
report, the largest percentage of any resource over the last
five years. Approximately, half of families used a
scholarship or grant to help pay for college.
“Families wrote smaller
checks for college this year as they looked less to their
wallets and more toward free money to make college happen,”
says Raymond Quinlan, chairman and chief executive officer,
Sallie Mae, a company focused on helping families save, plan
and pay for college. “Scholarships and grants have become an
increasingly important part of the pay-for-college mix, and
it’s encouraging to see organizations, schools, and the
government stepping up to provide them.”
• Bachelor’s: the new
norm: Families are firmly in agreement on the value of
college: 98 percent believe it’s an investment in their
student’s future and 90 percent expect their student to earn
a bachelor’s degree. What’s more, 54 percent of families
expect their student to earn a graduate degree.
Families are putting their
money where their mouth is -- the vast majority are willing
to stretch financially to make college happen.
• Making college more
affordable: Nearly all families took at least one
cost-saving measure, while most took five or more. These
measures include cutting personal spending, working while in
school, living at home, and taking accelerated coursework to
graduate faster.
Additionally, four in five
students attended college in their home state, and one in
three started at community college. Eighty-five percent of
families completed the Free Application for Federal Student
Aid (FAFSA).
• Borrowing not a forgone
conclusion: Fewer than half of families borrowed last year.
In fact, the proportions of funding from family savings and
income and scholarships and grants were twice as high as the
proportion of funds borrowed. Student borrowing paid 13
percent of all college costs, down from 16 percent last
year.
• Cost important, but not
top factor: Sixty-seven percent of families narrow college
choices based on cost, but when it comes to making the final
decision, this takes a back seat. Primary reasons in
choosing a college are split evenly between academic program
and personal choice, which includes campus culture,
extracurricular activities and student population. Cost
ranked third at 27 percent.
• Planning still pays off:
Only 40 percent of families have a plan to pay for college —
but in families with plans, students are more likely to
pursue bachelor’s degrees, there is more willingness and
ability to spend on college, and students borrow 40 percent
less than those from families without plans.
For the complete report,
visit SallieMae.com/HowAmericaPaysForCollege. Join the
conversation using #HowAmericaPays. To learn more about
planning for college, visit Salliemae.com/PlanforCollege.
“The results of this
important annual study shed light on critical financial
decisions families are making for and with their
college-bound students,” said Julia Clark, senior vice
president at Ipsos Public Affairs. “The changing roles that
college cost, borrowing, and savings play in this process
are essential to understand as key factors in the broader
higher education landscape.”
Courtesy StatePoint
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