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Congress needs to step up, Part 1. Princeton eliminated loans for low-income students 10 years ago and extended the program to all student aid packages in the 2001-02 academic year. But the no-loan movement didn't really get rolling until congressional leaders started pressuring the big-money schools to use more of their endowments on student financial aid. Lawmakers need to keep the pressure on so that more schools see the light.
Congress needs to step up, Part 2. The best way to help low-income students attend schools without a no-loan pledge is to increase the Pell grant program. Pell grants are aimed at the neediest students and once covered the majority of public colleges' costs. Today, Pell grants typically cover just one-third of the average cost.
Doubling the current maximum annual grant of$4,731, as FinAid.org's Kantrowitz recommends, would go a long way to making college more affordable. It would also add $10 billion to $15 billion to the federal budget; for comparison purposes, that's what we spend in a few weeks on the Iraq war. (For details on the current grant programs, see "Find free money for college.")
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Families need to step up. One of the reasons college costs are out of control is that price has been no object for too many students and their families. Whatever the cost of their desired school, they'll pay it, even if it means agreeing to a lifetime of debt. Families need to stop buying educations they can't afford. Saving for college should start in infancy, even if it's just a token amount.
And students need to limit their debt. The days of racking up six-figure debts to work in a $40,000 job have to end; if you have to borrow more than you'll earn in your first year on the job, you're probably borrowing too much. (See "How much college debt is too much?")
As is often the case with financial problems, a combination of public pressure and private responsibility will go a long way to solving the problem of a system that's gone overboard on debt.
Published May 29, 2008
READ MORE: FINANCIAL AID – STUDENT LOANS - PUBLIC COLLEGES – PRIVATE COLLEGES
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