A new survey finds American families are willing to increase their student loans or debt, or take on a second job or sell a car, so their children can attend college. This mind-set prevails despite the fact that student loan debt has taken on crisis proportions topping $1 trillion.
In a new survey we conducted with TeenLife.com, 41 percent of respondents said they would find some other way to pay the difference if the college their student wanted to attend was more expensive than they had planned. Thirty-one percent said they would have their student increase their loans or debt, and 23 percent of parents were willing to take out a second mortgage or increase other loans and debt.
“These survey results point directly at the reason student loan debt is outpacing credit card debt for the first time in history—families are still committed to sending their child to the college of their choice no matter what the cost,” said Frank Palmasani, a veteran guidance counselor and college admissions director, and creator of the Financial Fit™ program.
The survey, which polled over 3,000 adults between the ages of 30 and 60 with at least one college-bound teen in their household, also found that 52 percent did not factor affordability into the college search process until after that process was well underway. Nearly a quarter of families did not take affordability into account until FAFSA filings in January or when award letters arrived in the spring.
“At the very core of this epidemic is a college selection timeline that leads to poor financial decisions,” Palmasani said. “Families are told ‘don’t look at the sticker price—it’s not real,’ and they believe it because it’s true. But that doesn’t necessarily mean that a school is going to be affordable. Under a blanket of false security, students spend junior and early senior year selecting colleges, testing, and applying, all the while falling more and more in love with their top pick, which may well be unaffordable.”
In order to end the cycle of excessive student loan debt, Palmasani has created a first-of-its-kind program that helps students and parents tackle affordability first, at the start of their college search.
The Financial Fit program ($49.99 introductory price for one-year access) gives families a step-by-step process to figure out what they can afford, which colleges are their financial fits, how to file financial aid documents, how to pay for college, and how to analyze award letters to get the best deal.
Each step of the Financial Fit program features worksheets and short videos that give families their own virtual advisor in the planning and execution of the college search. Financial Fit also features the College Affordability Calculator™, which determines exactly what each family can pay for college by factoring in 10 key components including cash flow, expenses, and savings.
Additional features include a search function that links directly to each school’s federally mandated net price calculator, as well as a College Comparison Chart families can use to narrow down their college list by comparing net prices with affordability.