The authors of a just-released report say "we've entered into a post-recession reality in how families are paying for college."
Education lender Sallie Mae's annual report on how Americans pay for college shows that the use of college savings plans is at its highest level, even as annual spending has leveled out to $21,178.
Report authors say families are becoming more cost-conscious when it comes to choosing colleges and are more interested in saving money while they are in college. The result is that even though college costs continue to increase, "the amount that families are spending is holding steady."
Education industry observers say this is another sign of a crisis in higher education.
Tuition is the most important source of funding for most colleges. The new numbers show that even as more colleges are experiencing financial shortfalls, they will not be able to raise more money by raising tuition.
"If you widen the lens a little bit, what's been going on here is good news for students and their families," Jon Marcus of The Heshinger Report told Here & Now. "The survey tends to suggest that colleges and universities have sort of come to the limit of what families — including high income families — are willing to pay for a college education."
Recent conversations with Jon Marcus:
Jon Marcus/Hechinger Report "What was known as Augusta State University when those students arrived as freshmen has been combined with the neighboring Georgia Health Sciences University to form Georgia Regents University. It’s a kind of private sector-style consolidation that is becoming increasingly common not only for public institutions, but also for nonprofit, independent ones"
Chronicle of Higher Education "More than 150 degree-granting colleges failed the U.S. Department of Education's "financial responsibility" test for the 2011 fiscal year, data released on Monday show."
Inside Higher Ed "But the Sallie Mae survey might not be all bad news for institutions. On most metrics of financial worry, parents were more optimistic than they have been in the past."
This segment aired on July 23, 2013.
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