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Monday, June 24, 2013

Parents Finding New Ways to Pay for College


The cost of education has been hitting national airways for some time. Tuition and boarding costs are rising and parents are trying to find new ways of paying for their kid’s education. Changes have occurred over the past decade indicating additional reliance on tax benefits and grants. A 2013 report entitled Trends in Higher Education by the College Advocacy and Policy Board helps highlight how parents and students are paying for education and making ends meet. 

The report outlines the results of a study analyzing trends of how parents and students are paying for college. An average of 2002/03 fees and tuition for full-time students were $8,760 and rose to $11,960 in 2012/2013 marking a 37% increase. The addition of room and board raised the cost from $16,480 to $21,030 respectively.

In 2012/1013 tax benefits and grants covered 36% of total charges, 26% were covered from student loans, 38% of the costs were covered from other sources. Over the past decade their out-of-pocket costs raised $1,330 and loans covered an additional 2% of costs.  The use of federal unsubsidized loans increased while the use of private loans decreased.

The cost of public four-year public colleges increased dramatically over the past decade. With 40% of students enrolling in public four-year colleges the costs of tuition and fees raised $5,210 in 2002/2003 to $8,660 in 2012/2013 marking a 66% increase. Room and board costs increased 45% over this period. The report indicated that public four-year colleges had the largest increase in cost when compared to 2-year colleges, private colleges and for-profit colleges.  

The study summarizes its findings by indicating that parents and students are relying more heavily on grant aid and tax benefits to pay for most of their college expenses when compared to a decade ago.  The use of loans increased slightly but was not the main source of funding. By understanding the trends it helps to make adjustments to ensure that college education is within affordable reach for most students. It is this access to higher education and the use of that knowledge in beneficial ways that help society create new knowledge for advancement and growth. 

You may Read the Report HERE

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