College-Bound Students Step Up
The College Savings Foundation (CSF), a Washington, D.C.-based not-for-profit organization that builds public awareness of education savings, recently surveyed 500 high school students between the ages of 16 and 17 to learn how youth plan to fund their education. Of those surveyed, 44% plan to attend a public college, 18% are heading to a private college and 22% plan to enroll in a community college.
The CSF found that the recession is leading to an evolution in the college funding landscape. As parents across the country struggle with reduced earning power and retirement savings, more college-bound students are making plans to shoulder the burden of paying for higher education.
The majority of survey respondents (75%) said they consider it their responsibility to fund part or all of their higher education costs. Forty-one percent said that they might possibly be using their own money to pay for college and 22% said that they would definitely be funding all or part of their own education.
Of the 63% of students planning to use their own funds, 12% will be taking responsibility for more than 50% of the costs. Forty percent planned to pay for 25-50% of their education, and 48% said they would be paying for less than 25% of total costs.
The majority of those surveyed (55%) have begun setting aside money for college. Of those who are already saving, 19% have managed to squirrel away more than $5,000. Forty-three percent have saved between $1,000 and $5,000, and 35% have saved less than $1,000.
Gaps in Student Knowledge
Students are proactive when it comes to accepting responsibility and saving for their education, but the survey found that they need to learn more about savings plans, student loans and college costs in general.
The vast majority of students (85%) said that they will need some type of financial aid to attend college, but less than 50% have begun researching grants, scholarships and other types of aid. Seventy percent of survey respondents admitted that they have not researched various ways to save money (i.e. 529s, personal savings, etc.) and 68% have neglected to research any type of student loan.
Students are also fuzzy on the amount of money they will need to pay for their education. A whopping 80% have not projected the total amount they will have to borrow to graduate, and 35% have never had a discussion with their parents about college funding. Of the 65% who have talked to their parents, 17% have no idea how much (if any) money their parents will be contributing.
If you are one of the millions of students who are getting ready to go to college within the next two years, now is the time to begin your preparations. Start by talking to your parents about funding your education. Find out if they will be contributing, and if so, how much. This will help you estimate the amount of money you'll need for college.
Next, begin researching college savings plans, grants, scholarships, loans and other types of financial aid. It is never too early to begin learning about the different college funding options that are available to you and the ramifications they can have on your future. The following resources will give you a place to start: