New Report: Families Believe in Value of College, but Lack Understanding About Funding Their Education
Sallie Mae’s tools aim to demystify the process
Eight in 10 college-bound high school juniors and seniors (81%) view higher education as a path to better opportunities, but only 42% feel confident about financing that education, according “College Confidence: What America Knows About Paying for College,” the latest national study from Sallie Mae and Ipsos, a market research company.
The study examines what college-bound students and their parents understand about financial aid, the FAFSA®, scholarships, and student loans. The research results are based on an online survey Ipsos conducted, in English, with 550 parents of high school juniors or seniors planning on attending college and 585 college-bound juniors or seniors.
Key findings from the study include:
- Nearly three-quarters of families (74%) have started thinking about how they will cover the cost of higher education by the time their child is a high school junior but fewer than half (44%) are very or somewhat familiar with the FAFSA – the gateway to billions of dollars in scholarships, grants, and federal financial aid.
- Just 62% of families plan to complete the FAFSA; 29% feeling it’s a waste of time if the family makes too much money.
- Nearly half of families (45%) believe scholarships are only available for students with exceptional grades or abilities.
- Half of families (54%) are familiar with financial aid offers but 37% of them don’t know what information is included in those offers.
- Nearly half (47%) of college-bound families are planning to borrow to pay for college, but many are unclear on what types of aid needs to be paid back. Less than half of college-bound families correctly identified direct subsidized loans (47%), direct unsubsidized loans (46%), and the Parent PLUS loans (41%) as money that needs to be repaid.
- Only 18% of college-bound families agree that the amount families actually pay is lower than the price advertised by the school.
- First-generation college families need additional support as they navigate the financial aid process. Only 35% of first-generation families feel very or somewhat confident about it, compared to 54% of experienced families. Critically, while 42% of first-generation families indicate more Pell Grants and need-based financial aid would help them, only 32% definitely plan to submit the FAFSA®.
To help fill these confidence gaps, Sallie Mae offers a variety of free tools and resources to help families make informed decisions about college. At salliemae.com/college-planning, they can find tools to calculate college costs, view average financial aid packages from universities around the country, and discover scholarships for all kinds of students. The goal of these tools is to help students and families better understand college costs and encourage them to maximize free money first before borrowing.
To learn more, visit salliemae.com/college-planning.