More High School Students Save for College

College–bound students are taking their future into their own hands by saving and sacrificing more, making economical college choices and becoming more knowledgeable about the costs of borrowing. These are key findings of a survey of 16– and 17–year olds headed for higher education, the second annual How Youth Plan to Fund College issued by the College Savings Foundation (CSF), a leading nonprofit that helps American families save for their children's college education.

Nearly three quarters (72%) of the high school students surveyed think it's their responsibility to help fund their college education, and 65% are planning to use their own funds to pay for college, reinforcing key trends revealed in the 2010 survey. Yet this year students expect to contribute more of their own funds: 58% will cover more than one–quarter of their college costs, compared to 52% last year, and nearly one–in–five (18%) will contribute more than half of their college costs – up from 12% last year.

How will they get there? Seventy–three percent have decided that they want to save and nearly half – 48% – of the students have already started, each three points higher than last year. But the big jump occurs in the actual dollars saved: 69% of those students who are saving have already saved more than $1,000 – up from 62% one year ago. Roughly one quarter – 23% – have amassed more than $5,000 – up from 19% last year.

A key finding was that more students are setting their sights on affordable four–year schools. Over half, 51%, are looking at public colleges, up from 44% last year and pulling from both four–year private schools and community colleges. Sixteen percent are considering private universities (down from 18% last year); and 19% are looking at community colleges, down from 22%.

“Today's high school students are tackling the escalating costs of college by saving and becoming more educated about their costs and choices,” said CSF Chairman Roger Michaud.

The costs of college are foremost in the students' minds: 79% said that the costs of school influenced their further education plans, similar to 77% last year; and 83% of those said that costs are a factor in which college they plan to attend (86% in 2010) To meet those costs, students are supplementing their own funds with financial aid and student loans. Forty–seven percent definitely expect to receive financial aid, with an additional 34% possibly expecting it, (totaling 81% versus 85% last year).

Although somewhat fewer students are expecting to borrow for college (62% versus 66% last year), they are still worried about it: 92% of borrowers are concerned about their debt burden after college, similar to last year.

Meanwhile, high school students are working on a number of fronts to enhance their college savings:

 

• 72% would rather receive money for education on special occasions rather than tangible gifts, as in last year’s survey.
• 47% thought that friends or relatives might help with their college costs, up from 42%.
• Over half (52%) of those who have decided to save have gotten jobs to help, up from 48% last year.
• The number of high school savers willing to forgo things like electronics, cars or vacations jumped to 66% in 2011, compared to 54% in 2010.
• Twice as many high school savers are using 529 college savings plans than last year (16% versus 8%); and fewer are using plain vanilla savings accounts (68%, down from 80% last year).

 

The 2011 CSF How Youth Plan to Fund College survey was conducted by Zoomerang among more than 500 16- and 17-year-old high school students across the country, with parental permission.