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The emerging college affordability crisis threatens to derail the American Dream for millions of young people who either cannot afford to attend college or who are saddled with crippling debt that prevents them from furthering their education, starting a family or buying a home.  This emerging crisis has not been a prominent part of the national debate, despite its long-term threat to the future of our country.

Impact of High Cost of College

• 400,000 college-qualified high school graduates every year don't attend college because they and their families cannot afford the cost. (US Department of Education, Advisory Committee on Student Financial Assistance, Empty Promises: The Myth of college Access in America, June 2002)

• Undergraduate students represent 80% of private loan borrowers. (American Council on Education, Issue Brief, August 2007)

• Total borrowing through private student loan programs grew by 900% in the 10 year period 1996-2005. (American Council on Education, Issue Brief, August 2007)

•  Among undergraduates who borrow private loans at four-year public or private universities, 85% are full-time students. (American Council on Education, Issue Brief, August 2007)

• Recent graduates with very low salaries-about half of the median U.S. income-cannot manageably repay their student loan debt while meeting their other needs and these graduates inevitably experience financial constraints at lower debt levels than their higher earning peers. (US Public Interest Research Group, Paying Back, Not Giving Back: Student Debt's Negative Impact on Public Service Career Opportunities, April 2006)

• Almost two out of three of college students owes an average of more than $19,000 (Department of Education, National Center for Education Statistics, The Condition of Education 2007)

• 23% of students graduating from public four-year colleges cannot manageably repay college loans on a starting teacher's salary; thirty-eight percent of those graduating from private four-year colleges say the same.  (US Public Interest Research Group, Paying Back, Not Giving Back: Student Debt's Negative Impact on Public Service Career Opportunities, April 2006)

• With respect to Pell Grants: in the 1975-76 school year, Pell Grants covered up to 84% of the average annual costs of a four-year public college.  Because of sharp rises in college tuition and fees, by the current 2007-08 school year, the Pell Grant now covers only 32% of a student's annual college costs. (The College Board, Trends in Student Aid, 2007)

• After taking inflation into account, the costs of attending a public four-year college has almost doubled over the last 20 years (96% increase from 1977-78 to 2007-2008.) (The College Board, Trends in Student Aid, 2007)

• 37% of graduates of public institutions and 55% of graduates from private institutions say their starting salaries are insufficient to manageably repay college loans. (US Public Interest Research Group, Paying Back, Not Giving Back: Student Debt's Negative Impact on Public Service Career Opportunities, April 2006)

• 43% of qualified students from moderate-income families (with annual incomes of $25,000 to $50,000) are unable to attend a four-year college. (US Department of Education, Advisory Committee on Student Financial Assistance, Empty Promises: The Myth of college Access in America, June 2002)
• Debt related to student loans for college education can impact graduates in various ways. Some may delay the purchase of a home, others may wait to start a family, and some will have to put off graduate school for awhile. In many families, debt has a trickle-down effect, as repayment of one student's debt restricts another student's opportunities to pursue their dreams. The burden of student debt can also impact career choices, deterring a path towards altruistic ambitions in favor of a job that will help pay the bills.
• Many full-time students work while attending school, very often to help meet college costs. The challenge of balancing work and school can have negative results - from limiting class schedules and the number of courses a student is able to take to having to interrupt college careers to alleviate financial burdens.
• In 2004, parents of 15.3% of graduating seniors took out federal PLUS loans: 12.3% at public four-year institutions, 21% at private four-year institutions. Their average PLUS debt was $17,709: $14,056 at public institutions, $21,984 at private institutions. (These data are dependent students only and do not include other forms of debt, such as home equity loans, that parents may take on to help pay for college.) (The Project on Student Debt, Quick Facts About Student Debt)