College students increasingly use student loans to finance their education. The average college student will leave school with between $15,000 and $20,000 in student loan debt. Those students who drop out will not reap the benefits of attaining a college degree while being saddled with debt. Low-income students, who already are more likely to drop out due to other risk factors, such as academic preparation and working part-time, are especially at risk.
Two-thirds of students who enroll at a four-year institution with the intention of attaining at least a bachelor’s degree borrowed to finance their education. A similar proportion (68%) of students at private vocational school borrow. Perhaps most troubling is that almost one third (32%) of those borrowers at private institutions dropped out.
Half of all college students in the United States borrow to finance their education. Twenty percent of these students drop out, according to a report published by the National Center for Public Policy and Higher Education. These students are saddled with debt while lacking the income enhancement associated with a college degree.
The study uses data from the US Department of Education on students who enrolled in college in the 1995-96 school year, and tracks them in 2001.
The study also found that low-income students are caught in a double bind: they face the choice of working or borrowing in order to pay for their education. Low-income students are also more likely to drop out due to a host of other risk factors.
The good news is that borrowers do not seem more likely to drop out of four-year degree-granting institutions that non-borrowers. Other factors, such as working, or attending part-time appear to have a greater effect.
The study recommends focusing on academic preparation, including helping students understand their financing options for higher education. It also recommends making college more affordable and better support strategies for low-income students.
View the full report at the National Center for Public Policy and Higher Education's website.
Comments
Here in California, gubernatorial candidate Steve Westly has just proposed to scrape up the money (blurb says $200 - $400 million) to offer loans to students at community colleges (2 year AA degrees), which would be completely forgiven if they finish. There's minimal info on the campaign website at www.westly2006.com (no basis for #s; sounds like it may not be income tested; etc).
It sounds superficially pretty interesting - but do any of your numbers say anything good or bad about it?
Jon Elliott '80
(truth in adverstising: I've known Steve for 25 years and am helping the campaign on environmental issues ... but I don't know the education field and Policy is thicker than water!)
Thanks for the comment, Jon.
I took a gander at Westly's page, and I seriously wonder if it would really be impactful, because of the following caveat:
"Students must complete their studies in a reasonable about of time and exhaust all of their existing state, federal, and private financial aid eligibility."
This appears to be excluding remedial course work, and mandating that students complete a FAFSA. Both are valid choices, but his plan would benefit those students who are already prepared to do well in community college.
Politically, it's an intriguing idea that touches on themes of "fair share" and "responsibility." And that might be the true point of this plank of his platform. I'd love to see how this develops.
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