paying for college

  "10" by Michael Randall (flickr user pigpogm, cc license) On Monday, President Obama signed an executive order that should grant relief to millions of federal student loan borrowers.

  sallie mae, how america pays for college, figure 11 It's been known for a while that grandparents help their grandchildren to save and pay for college. But what is that role exactly? Little has been known before. For instance, in Sallie Mae's How America Pays for College, grandparents are lumped into a category with friends and other relatives. In all, this group contributes 5%.  Such data tells us little about the role of grandparents. However, a new Fidelity Investments illuminates the generosity of grandparents when it comes to college savings.

 image by flickr user guillaume lemoine, cc license Consider this scenario: a student receives a Pell Grant for his or her freshman year of college. That student proceeds to do well in school, with at least a 3.0 GPA. However, when it comes time to file the FAFSA (necessary for accessing another year of Pell Grant funds) during their freshman year, the student skips the process. Seems strange, right? That's what some researchers think, too. 

  image by flickr user FutUndBeidl (cc license) As we covered last summer, Congress passed into law student loan reforms that temporarily reduced student loan interest rates. However, as part of those reforms, the federal student loan interest rate, based on auction levels of Treasury 10-year notes, is allowed to float up to a capped percentage. This week, it appears that the first such increase is set to take effect on July 1, affecting all federal loans disbursed for the 2014-2015 academic year.

  decoder disc, image by flickr user LEOL30, cc license Yesterday, we covered the difficult coversations parents and students have when they negotiate which school to choose. For many families, cost is a major consideration. In fact, according to this U.S. News survey of college freshman:For 48.7% of freshman, financial assistance was very important in their final college choice. For 45.9% of freshman, the cost of attending their choice was very important in their final college choice. To understand the difference in costs, families need to compare their financial aid awards. The problem is, however, that these award letters can be confusing.

The Federal Student Aid office in the Department of Education recently updated their materials on loan forgiveness for public service employees (known as the Public Service Loan Forgiveness Program). In fact, you may have received their new version of the Dear Borrower letter about the program. While this can be a lengthy process, it can provide a lifeline to students who incurred a large amount of debt for school, but have chosen to pursue a career path that’s beneficial to society at large.

   image by flickr user FutUndBeidl (cc license) Our senior researcher recently got a request to look into the prevalence of schools with a total cost of attendance listed at $40,000 per year or above. The jump over the last 10 years of federal data is nothing short of shocking.

   image by flickr user lendingmemo (cc license) Over the past four months, debit cards on college campuses have faced heightened scrutiny. Much of this scrutiny has come from the Consumer Financial Protection Bureau (CFPB) and the Government Accountability Office (GAO). Today, the Department of Education's Office of Inspector General has published a report that is sure to garner attention, both on Capitol Hill and on college campuses nationwide. 

 image by flickr user davepearson, cc license If you were to google "why is college so expensive," you surely wouldn't be at a loss for links to click. A confluence of known changes in higher education (including public funding cuts, new facility and technology costs, administrative 'bloat'), possibly some disputed changes (most notably financial aid and federal student loans), and surely some other factors (like the continued belief that, despite rising costs, college is worth the investment) have worked together to make college 1,120% more expensive than it was 30 years ago. However, is it possible that certain expensive schools are worth far more than their sticker price? That's the investigation of this piece by NPR's Planet Money. 

At least once a year, an article about target numbers for college savings are published on major media websites. Recent articles include this one on NYtimes.com, this one on usatoday.com, and this one on reuters.com. A new one came out just this week on Foxbusiness.com. As one can see, this is common territory. But, here at College Parents of America, we think that such articles serve as helpful reminder of how difficult it can be to project out college costs and figuring out your needed amount of savings.