While about 81% of college-bound juniors and seniors said they view higher education as a path to better opportunities, only about half of them feel confident about financing their tuition, according to a new survey from Sallie Mae that examined how this group and their families feel about covering the costs of college.
Additionally, about 42% of surveyed families said they need help with planning how to pay for college. And 43% said there are too few resources to help cover the costs of higher education.
"As we have seen in our extensive research portfolio with Sallie Mae, students and families continue to agree college is a worthwhile investment," Ipsos Research Director Jennifer Berg said. "However, with this research, we learned that just 11% of college-bound families feel very knowledgeable about the different ways to pay for college, and many aren’t aware of the different funding sources available to them."
Families looking for help to cover the cost of college could consider private student loans. You can visit Credible to find your personalized interest rates and see if this option is right for you.
‘Lack of understanding’ on student loan repayment
About 47% of college-bound families are planning to borrow money to pay for college, but they are unclear about what kind of aid must be paid back, the survey said. Only 47% could correctly identify that federal government loans — such as direct subsidized, direct unsubsidized and Parent PLUS loans — must be repaid. And this misinformation grew among first-generation college families.
"The lack of understanding is even greater for first-generation families – just 35% feel confident about paying for college," Berg said. "This all speaks to a broader recommendation that college financing topics should be introduced in high school or earlier to provide families with tools, knowledge, and confidence to meet the cost of higher education."
If you're using student loans to pay for college but federal funding doesn’t cover everything you need, you could consider taking out a private student loan. Visit Credible to compare multiple private lenders at once and choose the one with the best interest rate for you.
Many families unfamiliar with or misunderstand FAFSA
Just 44% of college-bound families are very or somewhat familiar with the Free Application for Federal Student Aid (FAFSA), according to the study. This provides access to scholarships, grants and federal student loans to help pay for educational expenses.
While 62% of families said they plan to complete FAFSA, 29% said it is a waste of time if their family makes too much money and has less financial need, Sallie Mae said.
"Higher education opens doors and opportunities for students and families, but it’s clear planning and preparing for that significant investment can be confusing and stressful," Nicolas Jafarieh, Sallie Mae senior vice president, said. "Students and families need clear and consistent information, and support to fill these confidence gaps."
Financial aid is available through colleges and universities, third-party scholarships and FAFSA. If you need more funding after exhausting these options, you could consider taking out a private student loan to pay for college costs. Contact Credible to speak to a student loan expert and get all of your questions answered.
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