College costs will go up for one-in-five working Americans in the next academic year, according to the latest Millionaire Corner survey. What’s driving the increase?
One-in-five working Americans expects to spend more on college costs in the coming academic year, while 8 percent expect their college costs to go down, according to the results of a survey of more than 1,400 investors conducted by Millionaire Corner in July.
For the majority of working Americans (61 percent), the increased spending is due to an increase in college costs. The College Board reports that tuition and fees rose an average of 8.3 percent at the nation’s public universities last year.
More than 30 percent of working Americans are sending a student off to college for the first time, according to our research. The loss of a scholarship or grant, or the inability to obtain such financial aid, is contributing to increased college costs for 15 percent of working Americans. Nearly 10 percent have exhausted their available credit. Unable to borrow more money, they are dipping into current earnings or savings accounts to cover college costs.
Investors ages 40 and younger report a much higher level of difficulty obtaining additional credit, according to our July survey. More than 20 percent say they are unable to borrow any more money to cover college costs. (A Millionaire Corner survey conducted in May finds that college costs are the single most significant source of debt for investors age 40 and younger.)
Working Americans who expect college costs to be lower next year cite a variety of reasons for the decline. Most commonly, the student receiving the support has graduated or stopped attending school for other than financial reasons.
About 15 percent say the student they’re supporting has found ways to cut costs through such means as finding more affordable housing or transferring to a less expensive school. Another 15 percent say the costs of attending the institution have actually gone down, and another 15 percent say they have reduced the amount of support they are giving. Just over 15 percent say the student they are supporting has taken on more debt to cover college costs, and about 5 percent say the student has put his or her education on hold due to the expense.