Students and families pay for college using a whole variety of sources. College ended up costing the average American family $24,097 last year, that’s an almost 25 percent increase from the year before, according to Sallie Mae’s third annual report about college spending.
Sallie Mae—which should certainly know, since it makes money servicing more than $180 billion worth of student debt—reports that parents paid for 37 percent of college costs using their own income and savings. They met 10 percent of college cost through loans.
Students ended up paying for a fair amount of college, too. Some 14 percent of college costs were paid using student loans. Students also contributed an average 9 percent of the total though their own work and savings. Families managed to pay for 23 percent of the cost of college with grants. Another 7 percent came from friends and relatives.
This breakdown was about the same as Sallie Mae reported last year.