In 2023, Sallie Mae underscored its commitment to closing the college completion gap with a $1 million research endowment to Delaware State University (DSU). The grant supports a “Persistence and Completion Pilot Program,” that identifies and studies barriers to degree completion, helps students return to school, and develops policy recommendations and best practices so students can re-engage at institutions across the country. To date, the program has re-enrolled 213 students — nearly half of them first-generation college students.

This is important work. The number of students who have some college experience, but no degree, is over 40 million. Approximately 3 million are “near completers” who have stopped out mere credits away from degree completion.

Two near completer students — Nataniel (Tannie) Speaks and Chris Kearney — are proof of what’s possible when students get the right support at the right time.

After earning an associate degree, Tannie hoped to continue her education — but full-time work and raising two children put that goal on hold. Years later, she learned about the near completer program and re-enrolled at DSU. Five months later, she earned her bachelor’s degree.

“I still get chills and tears just thinking about it,” she said.

Chris’ journey also spanned decades. He first enrolled at DSU in 2000 with plans to earn a history degree, but stepped away in 2005 to support his growing family. A decade later, when his mother was diagnosed with breast cancer, Chris was determined to finish school for her. But after her passing, he once again put his education on hold.

In 2022, Chris felt a renewed urgency. “I’d reached a certain point in my career path where I felt the need to have my degree completed,” he said. “I thought it would complete me more holistically and professionally.”

In 2023, he graduated with a degree in liberal studies — this time, with his wife, siblings, and children cheering him on. “It felt like I was showing and giving examples to my children about fortitude and perseverance, about how sometimes when life happens, you can transcend, you can overcome and you can change the trajectory of your life for the better,” Chris said.

For Tannie, the impact of earning her degree was immediate.

“I want everybody—kids, young people, old people—to know that it’s never too late to finish your education,” Tannie said. “It’s a second chance at making something new.”

“Reach out to Sallie Mae. They have resources, they have things at their disposal to help encourage you to come back, and not only encourage you to come back, help you see this through to the end of your journey, ” Chris said. “You can do it. You have the wherewithal. You have the grit. Get it done.”

Sallie Mae is committed to supporting college completion. Too many students leave school just a few credits shy of a degree — often due to financial strain or personal circumstances. In fact, our 2024 “How America Completes College” report found that nearly half of non-completer said financial challenges played a role n their decision to leave school. Through programs like the “Persistence and Completion Pilot Program” at Delaware State University — and our “Completing the Dream Scholarship” — we’re helping remove barriers and support more students from dream to degree.

The federal higher education financing system is doing too much for too many and not enough for those who need the most support. The government lends a staggering $126 billion in federal student loans each year. With some programs allowing students and families to borrow virtually unlimited amounts, without considering the ability to repay, it’s no surprise families are overextended and too often overborrowing to pay for college

This system as it currently stands compounds two harms: First, it causes tuition inflation —particularly in areas like graduate school — and then saddles families with debt they cannot reasonably be expected to repay. In fact, recent data shows that in the past 20 years, college costs have grown twice as fast as the consumer price index (CPI). Similarly, a study by the Federal Reserve Bank of New York found that increases in federal lending cause higher tuition.

---

Reforming the System

Polling shows Americans overwhelmingly believe addressing the unlimited nature of federal loan programs would be an important step both in protecting students and making college more affordable. Reform should start with the unremarkable yet often forgotten principle that borrowing should not be the first option when it comes to paying for college. That means connecting more students to grants and scholarships. Meaningfully increasing Pell Grants, which don’t need to be repaid, can also increase college enrollment and retention rates.

Those who qualify for Pell Grants should also be able to apply for them more easily. In 2023, more than $4 billion in Pell Grants went unclaimed — that’s billions of dollars that could have put higher education within reach for the students with the greatest financial need, students for whom another loan is simply not the answer. Our research also consistently finds that many families are not applying for scholarships because they either don’t know how to access them or incorrectly believe they won’t qualify. That’s why we created a free resource — Scholly Scholarship Search by Sallie — that puts more scholarships within reach for college-going families.

Focusing on Completion

We also need a renewed focus on college completion, not just college access. Those with a college degree earn $1.2 million, or 86% more over their lifetime, than those with a high school degree. Public-private partnerships can play a role in supporting college completion. Sallie Mae has partnered with Delaware State University (DSU),  endowing $1 million to research barriers to degree completion and re-engage hundreds of near-completer students to get back on the path to graduation. The program will also develop and advance policy recommendations and best practices to foster student re-engagement nationwide. We’re also removing barriers to completion through our Completing the Dream Scholarship. Together with Thurgood Marshall College Fund, we’ve eliminated nearly $2 million in unexpected costs for students.

The federal student aid system can and should be simpler and work better for students and families. That will require sensible federal student aid reforms, greater transparency and clarity around college costs, connecting students with demonstrated need to grants and scholarships before borrowing and supporting college completion, not just college access. It’s well past time we go beyond quick fixes and focus on meaningful and lasting reform to address these broader issues.

We’re in the business of promoting responsible borrowing and advocating for policies and solutions that support higher education access, affordability, and completion.

The Sallie Mae^® of today might surprise you. We’re not a part of the federal government or a federal student loan servicer — we’re an education solutions company, providing students and families with free college planning resources and responsible private student loans to cover any gaps in financing after income and savings, scholarships, grants, and other federal financial aid.

Sallie Mae’s approach is rooted in a responsible lending philosophy: students and families should borrow only what they need and what they can reasonably afford to repay. The federal student loan program, however, allows too many students and families to overborrow for higher education. By offering some federal student loans in virtually unlimited amounts, without consideration of a borrower’s ability to repay them, the federal program allows, predictably, unsustainable levels of debt. Recent polling shows most Americans believe addressing the unlimited nature of federal loan programs would be an important step in protecting students and making college more affordable. A recent editorial in the Washington Post agreed. Sallie Mae supports responsible lending, and common-sense reforms to the federal student aid system.

Sallie Mae Supports Access and Affordability

Of the $1.74 trillion outstanding student loan debt in 2024, $1.6 trillion – about 93% – was made and held by the federal government. The remaining 7% are private student loans, which are credit-based and underwritten by numerous private lenders, including Sallie Mae, who assess the borrower’s ability to repay before making a loan.

Borrowing for higher education should be the last step students and families take when paying for college. The first step is to find money that doesn’t need to be repaid, or “free money,” such as scholarships and grants. The second step is to explore federal financial aid by filling out the Free Application for Federal Student Aid (FAFSA®) to  access more than $111 billion in federal aid available through the government. If there is a remaining financing gap, a responsible private student loan may be an option.

Our responsible lending approach works. On average, fewer than 3% of our loans in repayment default annually.

Sallie Mae is committed to helping students succeed.

Providing responsible financing is just one part of how Sallie Mae achieves its mission of powering confidence for students and families navigating their unique journeys to, through and immediately after college, while avoiding the pitfalls of unlimited federal lending. Our goal is to help families make informed decisions about higher education and complete their degrees, which is why we provide free financial planning tools for anyone to use, whether they’re a Sallie Mae customer or not.

We guide students and their families by emphasizing financial literacy from day one — before they even take out a loan. Our array of tools and resources to help students effectively plan and pay for college is available for free on SallieMae.com.

Examples of our tools include:

• A free scholarship search tool helps connect students to scholarships based on their skills and interests.
• We provide a variety of college planning tools and calculators to help customers understand how to best save and pay, including a college cost calculator, college planning calculator, and a step-by-step FAFSA guide.
• Through The Sallie Mae Fund, we have provided millions of dollars in scholarships to support access and completion for students from underserved communities. By the end of the 2023-2024 academic year, we awarded over $4 million in scholarships through this program, in partnership with the Thurgood Marshall College Fund.

If students decide to take out private student loans with us, we want to make sure they’re informed. We provide clear communications regarding their choices, including the option for undergraduate and graduate students to make payments while in school. Roughly half of Sallie Mae customers go this route, which helps save on the total cost of their student loans. We also provide consistent communication regarding their loans, including an annual statement detailing what they owe.

We know that financing higher education can be complex and confusing, but Sallie Mae is here to make sense of it. That means ensuring students and families feel confident and informed about how to plan and pay for higher education, and if they need to borrow, providing responsible options to power them throughout their unique journey.

FAFSA is a registered service mark of U.S. Department of Education, Federal Student Aid

The federal government lends over $82 billion in federal student loans each year, yet the system too often fails those it was designed to help and continues to allow far too many students and families to overborrow to pay for higher education. Some federal student loans are made in virtually unlimited amounts and without meaningful underwriting, often to students and families who are not able to pay them back. This has contributed to overborrowing and the rising cost of higher education. In addition, too many resources are being used to fund federal loans to students and families with little need for taxpayer assistance. Those resources could be better used elsewhere to help those who really need support.

At the same time, a complicated application process to apply for scholarships, grants, and other federal aid, and confusing financial aid offers, leave too many students at risk of overborrowing—and unable to pay back their federal student loans.

We believe addressing these issues would bring long-lasting solutions that are good for the federal higher education system as a whole. 

---

Three Recommendations for Reform

1. Address college costs and limit overborrowing

Americans hold $1.74 trillion in student loan debt as of the second quarter of 2024. Of that total, roughly 93% of loans today are made by the government. The remaining 7% are private student loans, which are credit based and underwritten by private lenders, including Sallie Mae, who assess ability to repay before making a loan.

By allowing virtually unlimited borrowing without considering the ability to repay, the federal program continues to create unsustainable debt levels and limits incentives to explore affordable education options. Common sense reforms to these federal student loan programs would protect families from taking on more than they can afford to repay and encourage students to consider all educational options, bending the curve of rising college costs.

2. Focus resources on those who need the most support

Access to higher education remains uneven. The federal student loan program continues to do too much for too many and not enough for those who need the most support. Too often, students from underserved communities – many of whom are first-generation college students — lack the tools and resources needed to make well-informed, confident decisions about paying for their higher education.

We know borrowing should never be the first option for paying for college, but the current federal financial aid system is poorly designed to avoid it. Redirecting resources to expand Pell Grants could boost enrollment and retention for students who show real financial need. We support meaningfully expanding the Pell Grant for low-income students, which could increase both college enrollment and retention. We also need to make it easier for them to apply. In 2024, more than $4 billion in Pell Grants went unclaimed, money that could have put higher education within reach of students who need it most.

In addition, the issues that have plagued the Free Application for Federal Student Aid (FAFSA^®) need to be fully addressed, so the already complex process of applying for federal financial aid is less confusing for students and families. Likewise, financial aid offers from schools should also be clearer and more transparent so that families understand the true cost of college and how much they will ultimately need to pay.

To do our part, we offer all students and families access to free college planning tools including a free scholarship search tool, and step-by-step FAFSA guide.

3. Empower degree completion

Access to college on its own is not enough – higher education stakeholders need to focus attention and resources on prioritizing college completion just as much as college access.

Far too many students take on debt without earning a degree. In fact, more than 40 million Americans have some college education but no degree. Too often, they are first-generation students and those from underserved communities.

In addition, roughly six in 10 students who start college graduate in six years. Research consistently shows financial issues, life changes, and mental health concerns are some of the barriers that keep students from graduating

Often small debts, overlooked bills, or expenses get in the way of completion. To address that issue, we created our Completing the Dream Scholarship in partnership with Thurgood Marshall College Fund.

We’ve also partnered with Historically Black College and University Delaware State University (DSU) to help close the college completion gap. Our $1 million research endowment to DSU funds a comprehensive three-year “Persistence and Completion Pilot Program” to study and understand barriers to college completion and help students return to school to complete their degrees. The research will help advance policy recommendations and best practices that enhance student re-engagement at DSU, HBCUs, and other institutions nationwide.

Reforming the system and addressing the cycle of ever-growing federal student loan debt will require collaboration among higher education leaders and stakeholders. Sallie Mae is committed to driving meaningful change by promoting a more transparent federal student aid system.

Each year, millions of students and families begin planning for college by completing the Free Application for Federal Student Aid (FAFSA®). It’s the gateway to accessing more than $100 billion in grants, scholarships, and other federal financial aid for higher education. Confusion and misconceptions about the FAFSA, however, persist — leading those who need the most support to potentially miss out on critical aid to make college more accessible and affordable. As an education solutions company and responsible private lender, Sallie Mae helps students and families complete the FAFSA, offering a free step-by-step guide as well as free resources to connect them to scholarships.  

Test your knowledge of the FAFSA by taking this quiz.

Paying for college can be a complex, stressful process. Yet, a new study finds students and families may be missing out on scholarships, which can help make college more accessible and affordable. In fact, about one-third of families didn’t take advantage of scholarships to help cover college costs for the 2023-2024 academic year, according to Sallie Mae’s 2024 How America Pays for College report.

In addition, misconceptions about scholarship availability and eligibility persist. More than half of families (52%) believe scholarships are only available for students with exceptional grades or abilities, and families who didn’t apply cited lack of awareness, doubt in winning, and effort required to apply.  

The good news is there are free resources that can help connect students and families to scholarships. Scholarship Search by Sallie easily finds and sorts through hundreds of available scholarships with no registration required.

Don’t Leave Free Money on the Table

Applying for free money is the first step in Sallie Mae’s 1-2-3 approach to paying for college.

Free money, such as scholarships and grants, are often what helps students from underserved communities access and complete higher education. Last academic school year, 88% of students attending Historically Black Colleges and Universities (HBCUs) relied on scholarships and grants to pay for college.

To help expand access and completion for more students, Sallie Mae’s Bridging the Dream Scholarship Program helps those from underserved communities access and complete college. Since 2021, Sallie Mae has awarded over 900 scholarships worth nearly $4 million in partnership with Thurgood Marshall College Fund (TMCF) through the Bridging the Dream Scholarship programs, which also include the Completing the Dream Scholarship and the Bridging the Dream Scholarship For Graduate Students. These scholarships are part of the company’s continued mission to help students access and complete higher education. 

Connecting students with scholarships and grants before they borrow is critical. However, more clarity around college costs and greater transparency in federal lending programs would go a long way in helping families make informed decisions about higher education financing.

To celebrate National Scholarship Month, Sallie Mae announced the latest recipients of its Bridging the Dream Scholarship for High School Seniors. For the fourth consecutive year, The Sallie Mae Fund has awarded deserving students up to $10,000 each in scholarships to support their higher education goals pursuing a diverse range of degrees, including business, engineering, fine arts, humanities, and more.

Since 2021, Sallie Mae has awarded over 900 scholarships worth nearly $4 million in partnership with Thurgood Marshall College Fund through the Bridging the Dream Scholarship programs, which also include the Completing the Dream Scholarship and the Bridging the Dream Scholarship For Graduate Students. These scholarships are part of the company’s continued mission to help students access and complete higher education—especially those from underserved communities.

Applying for scholarships is critical in helping students and families responsibly pay for higher education, and an important part of the planning process. In 2024, 88% of students attending HBCUs relied on scholarships and grants to cover the cost of college, according to our How America Pays for College 2024 report. In addition to the Bridging the Dream scholarships, Sallie Mae provides Scholarship Search by Sallie, a free resource that connects students and families to hundreds of scholarships, helping them navigate the process easily with no registration required.

Meet This Year’s Bridging the Dream Scholarship Recipients

Education solutions company and responsible private lender Sallie Mae and research firm Ipsos® released How America Pays for College 2024, which provides key insights into how current undergraduate students and parents of undergraduates view higher education and how they plan and pay for it. This industry-leading research considers education funding sources – from parent and student income and savings to scholarships, grants, and borrowed funds – and evaluates trends in payment strategies over time.

From planning to paying, learn how families are navigating their unique higher education journeys.   

---

Surveyed:

• 1,000 parents of undergraduate students (ages 18-24)
• 1,000 undergraduate students (ages 18-24)
• 349 undergraduate students (ages 18-24) from Historically Black Colleges and Universities (HBCUs)

---

College Spending Holding Steady

Families reported spending $28,409 on average this past academic year – in line with $28,026 in 2022-23.  Students attending HBCUs spent an average of $28,545 in the academic year 2023–24.

The majority — 48% — of college costs were covered by family income and savings, followed by scholarships and grants (27%), borrowing 23% and funds from friends and family (2%).

Impact of FAFSA® delays

Seventy-four percent of families submitted the Free Application for Federal Student Aid (FAFSA®) for the 2023-24 academic year — marking a steady increase year over year. However, for those who reported completing the new FAFSA for the 2024-25 academic year, just 29% found the new application easier to complete.

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. 

Borrowing is up for students and families.

Parents of HBCU students reported significantly higher balances for Federal Parent PLUS loans on average than families at non-HBCU schools: $14,207 vs. $5,795.

Roughly half of students who borrowed (48%) expect their federal loans to be forgiven; Just 40% of families who borrowed discussed who would be responsible for paying back student loans.

Scholarships can drive college access but misconceptions persist.

Scholarships were used by 64% of families, most of whom cited that scholarships made it possible for their students to attend college. On average, families reported receiving $8,250 in scholarships from their schools.

More than half of families (52%), however, believe scholarships are only available for students with exceptional grades or abilities. 50% of families who didn’t apply for scholarships cited lack of awareness.

To connect more students and families to scholarships, Scholarship Search by Sallie easily finds and sorts through hundreds of available scholarships.

Having a plan to pay makes a difference and boosts confidence.

Nearly 6 in 10 (59%) of families had a plan for how to pay for all years of college before enrollment — a more than 10% increase in 5 years — with higher income families more likely to have a plan.

More than half (54%) of planners felt completely confident in their college financing decisions, compared to just 32% of non-planners.

HBCU students agree earning a degree will create more opportunity.

Historically Black Colleges and University (HBCU) families received $14,217 from scholarships and grants. The largest funding source was grants and scholarships, covering 44% of costs while family income and savings covered 29%, borrowed funds covered 26%, and friends and relatives contributed 1%.

88% of HBCU students agree that earning a college degree will create opportunities they wouldn’t have had otherwise, and 81% believe it will translate to a higher earning potential.

These findings confirm families are increasingly recognizing the importance of financial planning for college. That said, the system can be improved by providing more clarity around the actual costs of college, offering greater transparency in federal lending programs, and further connecting students to grants and scholarships.

As a responsible private lender, Sallie Mae advises students and families to explore free money like scholarships and grants before borrowing. The gateway to this aid is the Free Application for Federal Student Aid (FAFSA®), which gives students and families access to $114 billion in scholarships, grants, state-based and federal financial aid. Too many families, however, miss out on this critical aid because of persistent misconceptions about their eligibility or confusion around how to complete the application, resulting in billions of dollars left unclaimed each year.

This year saw significant glitches and delays resulting from the rollout of a new FAFSA with fewer questions. While the intent was to streamline and simplify the process and expand eligibility for need-based aid like Pell grants, persistent implementation issues left students and families frustrated and financial aid offers from schools delayed.

About 74% of families reported completing the FAFSA for the 2023-2024 academic year, according to Sallie Mae’s How America Pays for College 2024 report. Of the families who filled it out for the 2024-2025 academic year, only 29% found it easier to complete. In addition, of those who experienced a delay, 44% reported experiencing stress waiting for financial aid decisions and 21% sought out additional financial aid options. When it comes to financial aid offers from schools, 71% of families said they support a simplified, standardized letter. Despite the FAFSA confusion, 88% of families still believe college is an investment in their child’s future, and 79% are willing to stretch financially to get there.

While these delays point to broader issues with the federal financing system for higher education, it’s still critical for families to complete the FAFSA. The FAFSA® is an important first step for students and families to help make college more accessible and affordable. Sallie Mae supports simplification of the FAFSA® and is improving awareness to help more students and families connect to scholarships, grants, and other critical aid.

As an education solutions provider, Sallie Mae provides free tools including a step-by-step FAFSA guide, information,  and webinars to help students and families navigate the new FAFSA and complete it. We also offer free resources like Scholarship Search by Sallie to help students and families find and apply for scholarships.

Here are five important points that students and families should know about the FAFSA®:

1. All students—regardless of family income—should complete the form.

Most families—87%—know to submit the FAFSA® each year so that their student qualifies for financial aid, but not all families know that every student is eligible to apply. Some 33% of families believe their income is too high for their student to qualify for aid, the most frequently mentioned reason why families didn’t submit the FAFSA® last year.

The reality is all students, regardless of income, should complete the form. Some of that aid, like scholarships, grants and state-based aid, is offered on a first-come, first-served basis. That’s why the sooner families can complete the FAFSA®, the better. Rollout for the FAFSA will start October 1^st and the form will be fully available on December 1^st for the 2025-2026 school year.

2. The FAFSA® is free.

Families should never pay to submit the FAFSA®. Filing is free, period. A paid service will not get students more aid. Sallie Mae offers students a step-by-step guide for navigating the new FAFSA, but they can also check with their high school, local college, and financial aid office for assistance.

3. Fill out the “special circumstances” form when financial information changes.

Students and families—including those attending graduate school—should complete the FAFSA® every year they are in school. That said, sometimes income and other factors may change due to circumstances such as a job loss or medical emergency. That’s when completing a “special circumstances” form may make sense. The form is available from college financial aid offices and can help students receive additional aid in certain situations.

4. List schools on the FAFSA® even if it’s not a final list.

If students don’t list all colleges they’re considering on their FAFSA®, then the schools won’t know the student is interested in applying for grant money from them. Students should also always list state schools first in case they offer additional state-based aid on a priority basis.

5. There is no age limit.

Federal financial aid is just as available to non-traditional students in the 24- to 35-year-old range as it is to students in their late teens and early twenties. There’s no age limit for receiving federal financial aid—so all students and families should apply.

FAFSA is a registered service mark of U.S. Department of Education, Federal Student Aid

After years of studying and working hard, millions of college graduates across the nation are transitioning from college to the next chapter of their lives. This could mean new jobs, new cities, or new goals — a cause for celebration. 

Even after students finish college, the learning doesn’t stop. Next on the syllabus is setting and maintaining a healthy budget, and for those who borrowed to pay for college (41% of students, according to our “How America Pays for College 2023” report), that budget will soon include paying back student loans.

To ensure students get started on the right track, Sallie Mae® works to remove the element of surprise from loan payments by initiating clear communication with students and cosigners while they’re in school and throughout the life of their loans. As a responsible private lender, we believe that transparency and clarity about how much students and families owe and when they need to pay back their loans is critical to helping them responsibly plan for higher education. 

Staying up to date on student loan status

Students have very busy schedules, which is why we make it as easy as possible for them to stay up to date on the status of their loans. Students can create an online account or download the Sallie mobile app to get notifications of when their upcoming payments are due. They can even enroll in auto-debit to ensure their payments are always on time, which can also save them money by lowering their interest rate.

We also send students and their cosigners a loan summary each year they are in school, including interest accrued. This is especially important for customers who choose to defer payments on their loan during college, as it helps them keep track of what they’ve borrowed and what they owe. That said, roughly half of our customers choose to make a fixed payment or pay interest on their loans while in school, which can significantly lower the total cost of the loan.

Tools and tips for the six-month separation period

Sallie Mae private student loans come with a six-month separation or grace period for undergraduate programs that begins once a student leaves school, giving them time to find a job and get settled into post-college life. We let students know at the start of their grace period what their estimated payment amount will be and provide tips on when, where, and how to pay on time.

We also offer free tools to help students prepare for repayment, such as a monthly budget worksheet, which helps students create a budget to meet their financial goals and our student loan repayment calculator that gives students an estimate for their upcoming monthly payments.

At the end of the day, preparation is key to responsible financial planning. From the moment students take out a loan through the months post-graduation, we help students and families not only meet their loan payments, but make strides toward their financial goals.