Just Released ‘How America Pays for College 2024’ Report Finds College Spending Stable with Family Out-of-Pocket Contributions Covering the Largest Share of Cost
Just 29% of Families Who Completed the New FAFSA® Found it Easier to Complete
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About 3 in 4 families (74%) reported completing the Free Application for Federal Student Aid (FAFSA®) for the 2023-2024 academic year, but of those who reported completing the new FAFSA® for the 2024-2025 academic year, just 29% found it easier to complete. In addition, of those who experienced a delay, 44% reported experiencing stress waiting for financial aid decisions, 21% sought out additional financial aid options, 14% considered switching to a lower-cost school, and 10% transferred schools. When it comes to financial aid offers from schools, 71% of families said they support a simplified, standardized letter.
Despite FAFSA® confusion and delays, nearly all families (88%) believe college is an investment in their child’s future, and 79% are willing to stretch financially to get there. Six in 10 families (59%) had a plan to pay for college before the student enrolled, matching an all-time high. Families also reported using artificial intelligence (AI) technology in the college planning process. About one-quarter of students (23%) and 18% of parents used AI in the college application or decision-making process. Three in 10 families (29%) who used AI utilized it to research financial aid or scholarship options.
"The study reveals a significant trend: families are increasingly recognizing the importance of financial planning for college,” said
Roughly half of families (49%) reported borrowing for college up from 41% last year. Borrowing covered 23% of costs, up from 19% the prior year with federal student loans and parent loans used most frequently. More than 4 in 10 families who borrowed (43%) said they considered attending more expensive schools because of access to loans. Roughly half of students (48%) expect their federal loans to be forgiven; just 40% of families who borrowed discussed who would be responsible for paying back student loans.
“Borrowing for college makes sense for some families, but it’s critical to have a plan and do so responsibly,” said
Scholarships and grants were used by 80% of families and covered 27% of costs. On average, families reported receiving
“How America Pays for College 2024” reports the results of Ipsos' online interviews of 1,000 undergraduate students and 1,000 parents of undergraduate students
Access the complete report and infographic at www.salliemae.com/howamericapays.
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Category: Research
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