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 Families spent an average of $24,164 for the 2014-15 academic year,
a 16 percent increase from the previous year, according to "How
America Pays for College 2015," a survey of 800 parents of
undergraduates and 800 undergraduates conducted by Ipsos Public
Affairs for Sallie Mae in April.
Much of the increase was due to families with incomes over $100,000,
who spent 25 percent more.
Parental income and savings also increased to 32 percent of the
amount spent, exceeding the amount contributed by scholarships and
grants for the first time since 2010, the report found. Sallie Mae
has commissioned the annual report since 2008.
Parents were less worried about losing their jobs or about their
children not finding work after college, said Michael Gross, head of
the higher education practice at Ipsos.
"There is a much brighter sense of optimism that the money they
spend educating their child is really an investment that's going to
pay off in the end," Gross said.
College spending peaked in 2010 at $24,097, or $26,271 in
inflation-adjusted dollars, before dropping as families worried
about a troubled economy, rising debt loads and higher unemployment,
according to previous studies.
This year, fewer families reported making cost-saving moves such as
choosing a college closer to home to reduce transportation costs,
having a student live at home, or adding a roommate.
Fewer families chose not to consider some colleges because of cost:
62 percent, compared to 68 percent a year earlier. Students,
however, were much more likely than parents to rule out a particular
college because of its price tag.
Three-quarters of the students polled said they eliminated a school
from consideration for this reason, against half of parents, said
Marie O'Malley, Sallie Mae's director of consumer research.
"These are students who aware that maybe Mom and Dad aren't made of
money," O'Malley said.
MORE BORROWING
The percentage of families who reported borrowing money to pay for
college rose to 38 percent from 35 percent last year. That figure
peaked at 46 percent in 2010. Families who borrowed spent on average
34 percent more ($28,386) than those who didn't ($21,219).
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Education debt is primarily the student's responsibility:
Undergraduates signed the loans in 83 percent of families. Within
the families who borrowed, students were the primary signer for
three-quarters of the total debt.
Although not all families borrow in a given year, most college
students graduate with debt, said Mark Kantrowitz, publisher of the
education resource site Edvisors.com and author of "Filing the FAFSA."
Seventy-one percent of bachelor’s degree recipients graduated with
loans, with an average balance of $35,000, he said.
On average, high-income families spent $33,260 on college expenses
while families with incomes between $35,000 and $100,000 spent
$21,375. Low-income families spent a similar amount: $21,036.
The average amount spent on two-year public colleges jumped 23
percent to $13,531. Spending on four-year public colleges rose 10
percent to $23,189, while four-year private college spending was up
20 percent at $41,857.
For many, the spending won't stop at a two- or four-year degree.
About half of all college students, or 68 percent of seniors, plan
to attend graduate school.
"The undergraduate degree has become so ubiquitous, so it may just
be that graduate school is the new college," Gross said.
(Editing by Bernadette Baum)
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