Paying for College

Insidehighered reported on a study that examined how families pay for college. As a parent, I often wonder how I will pay for my kid to sit in the very classes that I teach. The good news is that parents often find a variety of financial sources:

On average, the money to pay for the typical student’s college costs came from the following sources: parents’ income and savings (32 percent), student borrowing (23 percent), parent borrowing (16 percent), grants and scholarships (15 percent) student income and savings (10 percent), and support from friends and relatives (3 percent).

The bad news is that families need to borrow money to pay for college:

Just under half (47 percent) of all families reported borrowing to pay for college. Student borrowing from the federal loan programs was the top source of loan funds, with 28 percent of all families borrowing an average of $5,075 in federal student loans. Only 8 percent of students and 4 percent of parents said they held private education loans, but the amounts were significant: an average of $7,694 for students and $6,910 for parents. About 6 percent of parents utilized federal loans for parents.