Debt for U.S. college students of all economic backgrounds has hit record-breaking highs and is continuing to increase, according to this month's study by the Center for Economic and Policy Research.
Upon graduation from private four-year institutions such as AU, students from the lowest-income families have on average $22,000 in loans, and students from the highest-income families have slightly less at $21,000.
College costs, when adjusted for inflation, have risen over 50 percent since 1990. The study showed that in 1981, if a student worked full-time at minimum wage for one summer, they could cover two-thirds of their college costs, which would leave less than $2,000 left to be paid by other means. Today's college students would have to work full-time for an entire year at minimum wage to cover the costs of even a public university.
The study concluded that the increasing amount of students graduating in debt is partly the result of government policies that have made more loans available, but not grant money. The 1992 reauthorization of the Higher Education Act increased the amount of money and the number of students who qualified for federal loans, which led to the high numbers of students from higher-income families with significant debt. The most recent piece of legislation on higher-education, house resolution 609, proposes cutting nearly $9 billion from the student aid budget and would increase the cap on interest rates from 6.8 percent to 8.25 percent.
"As long as there is so little assistance for lower-income students, until Congress is willing to say that college is a right that everyone should have access to, it will be difficult to do anything to improve the debt situation for the middle and upper-income students," said Heather Bouchey, the author of the CEPR study.
According to Brian Lee Sang of the AU Office of Financial Aid, the average federal debt for AU students after four years of school is $19,000, which is lower than the national average for four-year private schools. The number of students at AU who default on their loans after graduation is also far lower than the national average. Approximately 66 percent of all AU students receive some kind of financial aid and eight percent of those students also apply for outside loans.
AU was also recently rated as a "best value college" by both Fisk College Guide and the Princeton Review, whose ranking are determined by level of academics, the cost, the awards and the average student loan debt and other aspects. According to the Admitted Student Questionnaire, 90% of all incoming AU students rated the value to cost as being good to excellent, as opposed to only 10% who rated it fair to poor.
AU students had their own complaints about university financial aid. Esther Austin, a sophomore in SIS, said the amount of hours she works for her work study job is very low.
"I would definitely work more hours if I could, because this year I had to take out more loans after AU cut a large portion of my grants," she said. "I wonder sometimes if the aid package is used to encourage freshmen to come. Then a lot of upperclassmen lose their aid once they are already here."
SOC sophomore Emily Bair has work study but chose to work off-campus instead.
"I decided that babysitting pays more per hour than work study, is more flexible, more fun, and I'm not restrained by the $1000 work study grant," she said. "I prefer to work in more informal situations."
Students who have loans are also more likely to hold jobs while in college, working an average of 22.4 hours a week, according to the study.
