Recession causes families to dig deeper to pay for college

University of Colorado senior Danielle Wright takes out loans and works full-time as a ski representative for Eldora Mountain Resort to pay her out-of-state tuition -- a much different financing scheme from when she began college.

As a freshman, Wright didn't need to juggle a job, and financial aid wasn't as essential.

The ripple effect from the recession, though, caused many in her family to lose their careers in the auto industry. Wright, from Bloomfield Hills, Mich., has taken on much more responsibility for paying her way through college now that her parents are out of work.

College students and their families have relied more heavily on private and federal loans, cut back spending to afford college and even leaned more on friends and relatives, according to a new national snapshot.

The "How America Pays for College" survey published Tuesday is among the first to gauge how the recession has affected college financing. Students in the 2009-10 academic year were the first to begin the decision-making process in the aftermath of the economic downfall in 2008.

The survey was conducted by Sallie Mae, a college-financing company, and Gallup, and it includes interviews with 1,600 college students and parents. Despite economic woes, the findings show college remains a top priority: Eighty-one percent of parents and 84 percent of students surveyed strongly agreed that college is an investment in the future, which is on par with responses in 2008.

Parents carried 47 percent of the share of college costs for the 2009-10 academic year, and students paid roughly one-quarter with their own paychecks, savings accounts and loans. Scholarships, relatives and friends helped stitch together the remaining costs.

Wright, who is studying psychology and pre-medicine, is planning on graduate school and aspires to become a physical therapist. At this point, she's unsure how much she'll owe when she completes her education.

"I want to pay my parents back," she said. "I'm trying to do the best I can."

At CU-Boulder, about half of Colorado students in 2008-09 graduated with debt, and a quarter of non-residents graduated with debt. The average debt load for those in debt -- parents and students combined -- was $30,000 for Colorado families and $62,000 for out-of-state families. That compares with $29,000 for Colorado families and $64,000 for out-of-state families in 2007-08.

To make college more affordable, 73 percent of families reduced spending or increased work hours, according to the national survey.

Overall, the percentage of families who used scholarships or grants increased from 51 percent in last year's study to 55 percent this year, and the percentage who borrowed to pay for college rose from 42 percent to 46 percent.

Student borrowing increased by $675, and parent borrowing grew by $486. The average contribution from friends and relatives jumped 53 percent from the prior year, an increase of $583.

Nick Julian, a high school senior from Columbus, Ohio, toured the Boulder campus Tuesday afternoon with his father.

He's considering colleges in Ohio as well as North Carolina and Colorado.

His father's employment at Ohio State University qualifies him for a tuition break, which will likely factor into the final decision. Julian's college plans haven't been affected much by the recession, and he will use a college savings plan to help pay his way.

Fifteen percent of families used money from a college savings plan to pay for college, up from 11 percent last year and 9 percent two years ago.

Contact Camera Staff Writer Brittany Anas at 303-473-1132 or anasb@dailycamera.com.