Study: College borrowing drops five percent
Lending giant Sallie Mae has released its annual “How America Pays for College” study and the corporation has found that students and their families are borrowing less money for higher education.
According to the survey, student-borrowing accounts for 15 percent of the total cost paid for college and parent borrowing is at seven percent. The remainder of the cost is covered by parent and student income and savings, grants and scholarships, and relatives and friends. Altogether, borrowing dropped five percent from the previous two years.
Of the respondents, 69 percent reported they are saving money by choosing in-state schools that have lower tuition fees.
The study suggests that this decrease in cost is, at least in part, due to an increased percentage of students choosing to attend community colleges as opposed to four-year universities. Since 2010, enrollment in four-year public institutions has decreased 11 percentage points while enrollment in two-year public institutions has increased by 11 percentage points.
Families have been making college more affordable in a variety of ways, according to Sallie Mae. Of the respondents, 69 percent reported they are saving money by choosing in-state schools that have lower tuition fees. A large number of participants also said that they reduced spending by cutting back on entertainment and chose schools closer to home.
This is the seventh year that Sallie Mae has produced the survey. Sallie Mae conducts the interviews in the spring—the second half of the academic term. To ensure accuracy, this timing “allows families to report actual amounts used (vs. projected amounts) to meet the cost of college that year.”
International Business Times reports that “more than eight in 10 American families say college opportunities are so worth the price, that they’re willing to stretch themselves financially in order to send their children to school.”
A Georgetown University study reports that, through the year 2020, there will be 55 million job openings. Of these, 35 percent will require at least a bachelor’s degree, 30 percent will require at least some college, and 36 percent will not require more than a high school diploma. Georgetown says that the United States will fall short by 5 million workers with postsecondary education.
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