Examining How Student and Parent Debt Impacts Postsecondary Value
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| Title: | Examining How Student and Parent Debt Impacts Postsecondary Value |
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| Language: | English |
| Authors: | Cochrane, Debbie, Postsecondary Value Commission |
| Source: | Postsecondary Value Commission. 2021. |
| Availability: | Postsecondary Value Commission. Available from: Bill & Melinda Gates Foundation. e-mail: ValueCommission@IHEP.org; Website: https://www.postsecondaryvalue.org/ |
| Peer Reviewed: | N |
| Page Count: | 18 |
| Publication Date: | 2021 |
| Document Type: | Reports - Evaluative |
| Education Level: | Postsecondary Education Higher Education |
| Descriptors: | Debt (Financial), Postsecondary Education, Value Judgment, Parents, Family Income, Parent Financial Contribution, Paying for College, Federal Legislation, Student Loan Programs, Loan Repayment, Student Financial Aid, Intellectual Disciplines, Outcomes of Education, Equal Education, Employment Qualifications, Wages, Economic Factors, Costs, Racial Differences, Federal Aid, Grants, Ethnicity, Gender Differences |
| Laws, Policies and Program Identifiers: | Federal Direct PLUS Loan Program, Pell Grant Program |
| Abstract: | With grant and scholarship aid as well as family resources unable to keep pace with college costs, loans have become a fact of life for millions of college students each year. In deciding how and how much to borrow, these students are making highly consequential decisions that will impact their future in unknown ways. Policy should aim to reduce the prevalence of postsecondary education opportunities that routinely leave borrowers with loans they cannot repay, and provide students with timely and relevant information and support with which to make borrowing decisions. Compared to the wealth of information available about student borrowing and debt loads, less research has focused on parent borrowing. Available survey data suggest that parents from across the income spectrum rely upon the parent PLUS loan program to pay for their children's education in different ways. More work is needed to understand the use and tradeoffs of using alternative (non-federal) debt to finance college, including short- and long-term consequences of leveraging wealth through credit cards, home equity loans, and private loans with high interest rates. Better understanding parent borrowing, including how those loans are used among those with differential financial strength and their effects on students' and parents' subsequent economic security and mobility would also help fill gaps in the research, especially as parent PLUS borrowing may uniquely impact Black families with limited wealth. |
| Abstractor: | ERIC |
| Entry Date: | 2022 |
| Accession Number: | ED617070 |
| Database: | ERIC |
| Abstract: | With grant and scholarship aid as well as family resources unable to keep pace with college costs, loans have become a fact of life for millions of college students each year. In deciding how and how much to borrow, these students are making highly consequential decisions that will impact their future in unknown ways. Policy should aim to reduce the prevalence of postsecondary education opportunities that routinely leave borrowers with loans they cannot repay, and provide students with timely and relevant information and support with which to make borrowing decisions. Compared to the wealth of information available about student borrowing and debt loads, less research has focused on parent borrowing. Available survey data suggest that parents from across the income spectrum rely upon the parent PLUS loan program to pay for their children's education in different ways. More work is needed to understand the use and tradeoffs of using alternative (non-federal) debt to finance college, including short- and long-term consequences of leveraging wealth through credit cards, home equity loans, and private loans with high interest rates. Better understanding parent borrowing, including how those loans are used among those with differential financial strength and their effects on students' and parents' subsequent economic security and mobility would also help fill gaps in the research, especially as parent PLUS borrowing may uniquely impact Black families with limited wealth. |
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