Tags: student | loans | financial | aid

Record Number of College Students Relying on Financial Aid

Tuesday, 20 Aug 2013 12:44 PM

By Melanie Batley

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For the first time, a majority of U.S. college students are relying on federal financial aid to fund their educations, and increasing numbers of students and their families are willing to go into debt to pay for college.

According to Politico, figures from the Education Department reveal that some 57 percent of those pursuing college degrees are relying on grants and loans. The data covering 2011 and 2012 is updated every four years, making the current analysis the first snapshot of student funding since the economic downturn that began in 2008.

"By definition, a lot has changed in four years, and that's going to be reflected in these numbers," Jack Buckley, commissioner of the National Center for Education Statistics, told reporters, according to Politico.

Even though grant programs have expanded over that past four years, particularly the federal Pell Grant, a higher proportion of students than ever, 41 percent, are taking out loans, up from 35 percent four years ago. The trend extends across all socio-economic categories. For example, 46 percent of students with families making more than $100,000 per year took out student loans, Politico reported.

Some education experts are concerned, however, that grants directly from colleges are too often being given away to students from higher income brackets when the beneficiaries, they say, should mainly be lower-income students.

The latest analysis of data from Education Department shows that roughly 39 percent of students from families making less than $20,000 per year receive grants directly from college programs, but 38 percent from families making more than $100,000 a year also are being awarded the grants, up from 33 percent four years ago. The wealthiest students also got grant aid averaging $10,200, which was much higher than the average $8,000 for poorer students.

"When you look at their distribution by income, you see that they're giving a lot of dollars away to people at the top of the income distribution that probably just don't need it as much as people at the lower end," Ben Miller, a senior policy analyst at the New America Foundation, told Politico.

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