How Low Income Undergraduates Financed Postsecondary Education:1992-93
Although the federal and state governments, postsecondary institutions, and other organizations provide substantial amounts of student financial aid, the net cost to full-time, full-year low income undergraduates and their families was $6,500 to $10,000 in 1992-93, depending on the type of institution attended (see table 13). These amounts are well beyond the EFCs.
Where do low income students obtain the funds they need to cover their educational costs? Because the NPSAS data provide only partial information on the financial circumstances of students and their families, this question cannot be answered with precision. However, NPSAS does provide some information on two of the most important sources of funds: parental support and student earnings.
The financial aid system has different expectations about parental support for dependent and independent students. Parents of dependent students are expected to help pay their children' s educational costs, while there is no such expectation for parents of independent students. It is therefore appropriate to look at parental support separately for dependent and independent students.
Dependent Students
Low income families often have difficulty helping their children pay for their education. In 1992-93, 50 percent of low income dependent undergraduates who attended full time, full year received money from their parents. Among those who did, the average amount was $2,800 (table 15). In contrast, 78 percent of the full-time, full-year dependent undergraduates who were not from low income families received money from their parents. They received an average of $5,600, about twice as much as their low income counterparts (table 16).
Of particular interest is parental support to the low income dependent students who did not receive financial aid (although only 11 percent of full-time, full-year low income dependent undergraduates were in this position, table 8). The unaided students were much more likely than their aided counterparts to receive parental contributions (77 percent compared with 46 percent), and they received more, on average ($6,000 compared with $1,900) (table 15). This suggests that while the parents of low income dependent students without financial aid in 1992- 93 had low incomes in 1991 (the reference year for determining income), they had other financial resources. For example, they may not have been low income on a long-term basis and may have been able to accumulate savings before 1991, or a noncustodial parent may have made a substantial contribution.
Nine percent of low income dependent undergraduates attending full time, full year received loans from their parents, averaging $1,800 (table 15). A similar percentage (11 percent) of their non low income counterparts received loans from their parents (table 16), but the non low income students received more, on average ($3,100 compared with $1,800), reflecting their families greater resources.
Parents often make non-cash contributions to their students support in addition to or in place of direct financial assistance. For example, students may live at home while enrolled or during the summer, allowing them to reduce their housing costs and save money from summer jobs to cover educational expenses. Parents may offer a variety of other types of support, such as furniture, meals, clothing, or the use of a car, to name only a few. It is very difficult to attach a dollar value to this kind of assistance.
Independent Students
Although parents are not expected to help their independent children pay for their education, 39 percent of low income single independent undergraduates attending full time, full year received parental contributions averaging $3,500 in 1992-93 (table 15). Their non low income counterparts were less likely to receive such help (31 percent) (table 16). This is not surprising, because the students who were not low income would have had less need for parental support. Low income independent students may or may not have low income parents. Whether or not their parents contribute is influenced by both their willingness to contribute and their financial ability to do so.
Parental contributions to independents with dependents followed a similar pattern, with low income students also being more likely to receive assistance. Twenty-one percent of low income students attending full time, full year received contributions from their parents, in contrast to 12 percent of their non low income counterparts (tables 15 and 16).
The majority of full-time, full-year low income students worked in 1992-93: 63 percent worked while enrolled, and 68 percent worked at some point during the year (table 15). They were actually less likely than their non low income counterparts to work at some point during 1992-93 (tables 15 and 16). This was true for dependent students and independent students with dependents; single independent students were about equally likely to work whether or not they were low income.
While one might expect low income independent students attending full time, full year to be less likely than their non low income counterparts to work (not working makes them more likely to have low incomes), it is not obvious why the same would be true for low income dependent students attending full time, full year. One possibility is that their family backgrounds give them less access to jobs. Among dependent students who worked while attending full time, full year, the average hours worked per week while enrolled were similar (about 20 hours) for low and non low income students, which suggests that scheduling demands may not be a factor.
Table 15 Percentage of low income undergraduates attending full time, full year who had various sources of support and average amounts received by supported students, by selected student characteristics: 1992-93
Contributions Loans Worked while Earnings during Loans through from parents from parents enrolled AY 1992-931 loan programs _______________ ______________ _____________ _______________ _______________ Average Average Average Average Average Percent amount Percent amount Percent hours Percent amount Percent amount2 ________________________________________________________________________________________________ Total Total 37.1 $2,930 9.6 $2,077 63.2 22 67.9 $4,157 48.3 $3,465 Net cost3 Less than $1,000 33.5 1,817 6.1 63.0 18 74.3 3,001 71.1 3,929 $1,000 $1,999 37.8 1,066 4.8 51.6 20 57.3 2,971 58.5 3,036 $2,000 $4,999 34.9 1,383 8.2 1,517 60.3 20 67.8 3,329 56.1 3,544 $5,000 $9,999 37.3 2,142 8.7 1,582 65.6 24 69.1 4,167 45.8 3,399 $10,000 or more 39.9 5,552 14.1 2,679 65.2 25 66.6 5,521 36.3 3,338 Unmet need4 Less than $1,000 36.6 2,051 6.5 1,838 76.1 21 81.5 3,828 77.8 3,375 $1,000 $1,999 31.4 1,773 10.1 1,377 67.8 20 79.4 3,379 74.0 3,195 $2,000 or more 37.9 3,219 10.1 2,176 60.3 23 63.6 4,369 39.2 3,560 Expected family contribution (EFC) Less than $500 22.3 2,229 8.5 1,559 48.2 25 52.0 4,797 45.9 3,450 $500 $999 45.2 2,431 10.2 1,408 57.9 21 67.6 2,869 44.1 2,958 $1,000 $1,999 41.6 3,136 10.0 2,439 69.9 21 74.3 3,635 51.9 3,758 $2,000 or more 44.9 3,551 10.0 2,703 80.5 23 82.5 4,943 51.0 3,502 Aid status Not aided 58.9 4,924 12.3 2,463 70.7 23 70.2 5,190 (5) Aided 33.0 2,257 9.1 1,982 61.8 22 67.5 3,981 54.8 3,465 Loan status Did not borrow 39.4 3,552 9.1 1,920 59.5 23 62.5 4,376 (5) Borrowed 34.5 2,080 10.1 2,240 67.5 22 73.5 3,958 100.0 3,465 Dependent Total 49.9 2,801 9.1 1,840 67.4 21 75.1 3,175 48.8 2,957 Net cost3 Less than $1,000 41.2 1,129 5.4 - 66.3 16 80.1 2,372 70.9 2,957 $1,000 $1,999 50.6 1,126 3.1 - 45.2 18 55.5 2,097 55.9 2,608 $2,000 $4,999 48.3 1,374 8.8 - 57.2 18 68.9 2,364 48.8 2,923 $5,000 $9,999 48.5 1,742 10.5 1,674 80.0 23 83.0 3,845 43.1 3,089 $10,000 or more 60.8 7,654 12.8 2,840 72.7 23 78.1 4,152 39.8 3,045 Unmet need4 Less than $1,000 43.4 1,343 6.5 - 78.6 20 83.6 3,280 71.2 2,888 $1,000 $1,999 38.3 1,577 10.0 - 61.8 18 81.4 2,855 64.8 2,774 $2,000 or more 53.7 3,312 9.7 2,080 65.0 21 71.3 3,197 38.9 3,037 Expected family contribution (EFC) Less than $500 48.5 - 5.1 - 62.3 - 74.4 3,403 50.4 3,177 $500 $999 48.4 2,446 10.1 1,493 57.1 21 68.3 2,536 45.4 2,864 $1,000 $1,999 52.6 3,206 8.7 - 64.8 19 71.4 2,769 54.9 3,039 $2,000 or more 50.1 3,228 8.4 - 87.4 22 91.0 4,270 49.7 2,994 Aid status Not aided 77.1 5,965 11.9 - 75.5 21 76.5 3,940 (5) - Aided 45.5 1,931 8.7 1,709 66.2 21 74.9 3,063 54.8 2,957
Table 15 Percentage of low income undergraduates attending full time, full year who had various sources of support and average amounts received by supported students, by selected student characteristics: 1992-93 Continued
Contributions Loans Worked while Earnings during Loans through from parents from parents enrolled AY 1992-931 loan programs _______________ ______________ _____________ _______________ _______________ Average Average Average Average Average Percent amount Percent amount Percent hours Percent amount Percent amount2 ________________________________________________________________________________________________ Dependent (continued) Loan status Did not borrow 50.5 $3,568 8.2 $1,535 64.8 21 70.4 $3,379 (5) - Borrowed 49.1 1,892 10.1 2,116 70.2 20 79.8 2,996 100.0 2,957 Single independent Total 39.2 3,467 11.4 2,713 74.3 23 77.1 4,566 51.5 3,824 Net cost3 Less than $1,000 36.0 2,931 7.5 - 68.4 20 76.3 3,805 75.8 4,614 $1,000 $1,999 26.2 - 9.9 - 79.8 22 80.7 4,160 61.0 3,749 $2,000 $4,999 31.7 1,544 9.4 1,902 72.7 21 76.2 4,103 64.6 3,918 $5,000 $9,999 38.5 3,010 7.5 2,418 70.8 24 75.0 4,560 46.2 3,658 $10,000 or more 50.3 5,308 20.3 3,388 81.2 23 80.4 5,361 37.4 3,467 Unmet need4 Less than $1,000 37.1 3,159 7.5 - 81.5 23 86.4 4,420 79.5 3,697 $1,000 $1,999 35.0 1,993 12.7 - 81.7 22 85.9 4,026 76.5 3,466 $2,000 or more 40.2 3,707 12.0 2,997 71.9 23 73.5 4,707 40.6 3,996 Expected family contribution (EFC) Less than $500 13.4 - 19.9 - 72.3 - 84.9 4,607 65.6 3,350 $500 $999 2.2 - 72.4 - 75.4 - 44.5 3,554 - - $1,000 $1,999 38.2 3,199 11.2 2,466 72.6 21 76.7 3,911 51.4 4,001 $2,000 or more 42.1 3,864 11.3 3,029 76.6 23 77.3 5,386 51.1 3,706 Aid status Not aided 59.0 4,718 13.2 - 81.8 21 80.9 4,906 (5) - Aided 35.1 3,031 11.1 2,427 72.9 23 76.4 4,506 58.4 3,824 Loan status Did not borrow 42.7 4,156 10.0 3,269 72.9 23 74.3 4,663 (5) - Borrowed 35.4 2,566 12.9 2,271 75.8 23 79.7 4,482 100.0 3,824 Independent with dependents Total 21.2 2,260 8.3 1,439 48.7 25 51.2 4,981 44.3 3,581 Net cost3 Less than $1,000 11.1 - 5.0 - 48.6 - 56.6 3,315 62.9 5,089 $1,000 $1,999 20.9 - 2.3 - 27.6 - 30.3 - 62.3 - $2,000 $4,999 15.4 - 5.1 - 47.0 22 52.9 3,790 56.3 3,912 $5,000 $9,999 23.4 1,478 8.1 - 47.0 25 49.9 4,030 48.1 3,366 $10,000 or more 23.4 3,358 10.7 1,720 52.4 27 52.8 6,568 34.2 3,378 Unmet need4 Less than $1,000 8.6 - 3.3 - 53.1 20 58.2 3,848 95.5 - 3,777 $1,000 $1,999 13.1 - 5.8 - 57.6 22 65.9 3,268 88.3 3,379 $2,000 or more 22.7 2,325 8.8 1,329 47.8 25 49.7 5,242 38.3 3,575 Expected family contribution (EFC) Less than $500 21.2 2,289 8.2 1,512 46.7 25 49.5 4,928 44.7 3,473 $500 $999 16.4 - 15.5 - 57.0 24 57.1 5,672 30.7 3,848 $1,000 $1,999 22.1 - 2.9 - 65.3 19 63.0 4,724 44.4 4,635 $2,000 or more - - - - - - - - 60.1 4,596
Table 15 Percentage of low income undergraduates attending full time, full year who had various sources of support and average amounts received by supported students, by selected student characteristics: 1992-93 Continued
Contributions Loans Worked while Earnings during Loans through from parents from parents enrolled AY 1992-931 loan programs _______________ ______________ _____________ _______________ _______________ Average Average Average Average Average Percent amount Percent amount Percent hours Percent amount Percent amount2 __________________________________________________________________________________________ Independent with dependents (continued) Aid status Not aided 42.3 $3,502 11.8 - 56.2 29 54.6 $7,051 (5) - Aided 16.9 1,634 7.6 1,642 47.3 24 50.6 4,579 51.0 3,581 Loan status Did not borrow 25.1 2,592 9.3 926 43.9 26 45.4 5,335 (5) - Borrowed 15.8 1,524 6.9 2,377 55.3 23 58.8 4,622 100.0 3,581
- Sample size was too small for a reliable estimate.
1 Includes earnings in summer 1992.
2 Average amount includes only students with loans.
3 Attendance-adjusted total cost minus total aid.
4 Attendance-adjusted budget minus EFC and aid.
5 Not applicable.
SOURCE: U.S. Department of Education, National Center for Education Statistics, 1992-93 National Postsecondary Student Aid Study (NPSAS:93), Undergraduate Data Analysis System.
Full-time, full-year low income students who were working while enrolled worked an average of 22 hours per week. They earned an average of $4,200 during the year (including summer). Dependent students earned less, on average, than independent students ($3,200 compared with $4,600 for single independents and $5,000 for independents with dependents). The lower earnings for dependent students may reflect their younger age. Average earnings for low income students enrolled full time, full year were less than those for their non low income counterparts, who earned an average of $4,900.
Parental contributions, work, and loans are sometimes substituted for one another. If parents are unable or unwilling to contribute or if students do not want to accept parental help, the major alternatives are work and loans. The tradeoff between work and loans reflects borrowing limits set by loan programs, availability of jobs, time available to work, and students willingness to go into debt.
Loans and Parental Contributions
Borrowing was associated with lower parent contributions for full-time, full-year low income students. Among dependent students, about one-half received parental contributions whether or not they borrowed, but students with loans received less from their parents, on average ($3,600 compared with $1,900) (table 15). Among independent students, those who borrowed were less likely than those who did not borrow to receive help from their parents, and if they did receive help, the average amount was less.
Table 16 Percentage of non low income undergraduates attending full time, full year who had various sources of support and average amounts received by supported students, by selected student characteristics: 1992-93
Contributions Loans Worked while Earnings during Loans through from parents from parents enrolled AY 1992-931 loan programs _______________ ______________ _____________ _______________ _______________ Average Average Average Average Average Percent amount Percent amount Percent hours Percent amount Percent amount2 ________________________________________________________________________________________________ Total Total 67.6 $5,504 10.7 $3,058 77.1 22 79.0 $4,893 29.9 $3,460 Net cost3 Less than $1,000 56.4 2,124 11.3 2,287 73.4 16 81.1 2,429 69.6 3,751 $1,000 $1,999 56.9 1,677 8.2 - 72.3 20 74.7 3,306 47.7 3,408 $2,000 $4,999 65.7 2,311 10.7 1,671 81.8 21 83.2 3,930 38.7 3,421 $5,000 $9,999 71.2 3,729 10.4 2,382 80.9 22 82.3 4,638 29.5 3,308 $10,000 or more 67.0 8,764 11.0 4,193 72.9 23 75.0 5,854 22.5 3,595 Unmet need4 Less than $1,000 74.9 5,641 10.3 3,052 80.2 21 82.9 4,595 24.9 3,172 $1,000 $1,999 62.0 4,180 12.5 2,140 82.5 22 81.9 4,322 46.2 3,252 $2,000 or more 62.1 5,564 10.8 3,255 74.2 23 75.3 5,274 31.9 3,685 Expected family contribution (EFC) Less than $500 23.2 2,832 7.4 - 70.0 24 69.8 7,171 60.5 3,936 $500 $999 48.5 1,807 10.4 1,779 64.9 23 70.4 4,359 50.5 3,157 $1,000 $1,999 42.7 2,258 9.2 2,337 75.5 22 79.1 5,201 51.1 3,382 $2,000 or more 72.0 5,811 10.9 3,213 78.3 22 79.9 4,827 26.0 3,461 Aid status Not aided 74.1 6,476 10.7 3,178 75.7 23 75.4 5,505 (5) - Aided 60.8 4,248 10.6 2,928 78.7 21 82.6 4,351 57.3 3,460 Dependent Total 77.8 5,597 11.3 3,141 78.8 20 81.2 3,910 28.1 3,206 Net cost3 Less than $1,000 60.0 2,137 10.0 2,523 76.4 16 83.7 2,334 69.9 3,542 $1,000 $1,999 61.0 1,677 8.7 - 74.3 20 76.9 3,088 46.6 3,149 $2,000 $4,999 68.7 2,339 10.7 1,722 82.2 21 83.8 3,735 36.7 3,187 $5,000 $9,999 78.3 3,781 10.9 2,387 82.1 21 83.5 4,093 27.0 3,114 $10,000 or more 85.0 9,070 12.5 4,470 74.3 20 77.8 4,056 19.2 3,243 Unmet need4 Less than $1,000 79.8 5,691 10.6 3,169 80.8 20 83.7 4,073 23.8 - 3,079 $1,000 $1,999 68.4 4,324 13.8 2,208 82.8 21 82.5 3,616 42.6 3,088 $2,000 or more 77.2 5,691 11.8 3,340 76.3 21 78.4 3,772 29.5 3,325 Expected family contribution (EFC) Less than $500 64.4 3,341 14.1 - 76.0 22 83.0 3,756 49.6 3,275 $500 $999 60.5 1,950 11.2 1,122 65.7 18 74.1 2,220 54.7 2,801 $1,000 $1,999 64.0 1,991 10.3 2,084 76.8 19 83.1 2,783 57.0 3,063 $2,000 or more 79.3 5,884 11.4 3,297 79.6 21 81.4 4,042 24.7 3,250 Aid status Not aided 82.7 6,556 10.9 3,176 78.1 22 78.0 4,605 (5) - Aided 72.2 4,353 11.9 3,104 79.7 19 84.5 3,247 55.6 3,206 Single independent Total 30.6 $4,186 8.5 $2,276 77.2 29 75.7 $9,803 34.5 $4,470 Net cost3 Less than $1,000 - - - - - - - - 64.4 - $1,000 $1,999 $2,000 $4,999 23.3 - 4.4 - 81.9 27 81.1 6,757 65.0 5,073 $5,000 $9,999 29.6 2,136 8.3 - 80.6 27 80.0 7,971 38.1 3,914 $10,000 or more 34.8 6,078 8.2 3,204 75.0 31 72.9 12,087 23.2 4,452
Table 16 Percentage of non low income undergraduates attending full time, full year who had various sources of support and average amounts received by supported students, by selected student characteristics: 1992-93 Continued
Contributions Loans Worked while Earnings during Loans through from parents from parents enrolled AY 1992-931 loan programs _______________ ______________ _____________ _______________ _______________ Average Average Average Average Average Percent amount Percent amount Percent hours Percent amount Percent amount2 ________________________________________________________________________________________________ Single independent (continued) Unmet need4 Less than $1,000 19.0 2,942 8.1 - 80.9 30 80.8 10,892 37.4 3,671 $1,000 $1,999 40.0 - 8.3 - 84.5 26 82.8 7,646 49.8 4,215 $2,000 or more 38.7 5,282 9.4 3,135 74.8 28 72.4 9,315 42.6 5,028 Expected family contribution (EFC) Less than $500 - - - - - - - - 51.2 - $500 $999 - - - - - - - - - - $1,000 $1,999 19.2 - 13.3 - 76.8 24 78.7 6,563 69.5 4,451 $2,000 or more 32.3 4,367 8.9 2,316 78.1 29 76.7 9,963 38.2 4,508 Aid status Not aided 40.0 5,100 8.6 3,368 68.5 29 65.5 11,405 (5) - Aided 22.9 2,886 8.3 1,339 84.3 29 83.9 8,813 62.1 4,470 Independent with dependents Total 11.8 2,750 6.8 2,578 66.5 30 64.7 10,751 39.9 4,151 Net cost3 Less than $1,000 $1,000 $1,999 $2,000 $4,999 31.9 - 17.7 - 71.0 25 65.9 6,869 57.4 4,884 $5,000 $9,999 11.3 2,923 5.7 - 66.4 30 68.4 9,619 52.9 4,069 $10,000 or more 11.1 2,939 6.6 2,651 67.7 30 64.9 11,376 34.8 4,047 Unmet need4 Less than $1,000 8.5 - 5.7 - 60.4 30 60.8 11,834 39.6 4,187 $1,000 $1,999 5.5 - 1.4 - 77.0 26 74.1 9,601 88.6 3,574 $2,000 or more 12.6 2,904 7.4 2,780 66.9 30 64.8 10,687 37.4 4,195 Expected family contribution (EFC) Less than $500 10.6 1,862 5.5 - 67.7 25 64.9 8,480 64.5 4,015 $500 $999 23.9 - 9.6 - 62.1 33 61.5 10,028 38.4 4,158 $1,000 $1,999 10.2 4,963 6.9 - 73.5 28 72.1 9,991 36.4 3,964 $2,000 or more 10.6 2,658 6.7 - 63.8 33 61.5 12,247 31.6 4,386 Aid status Not aided 12.8 4,161 10.4 3,101 61.1 33 57.1 12,653 (5) - Aided 11.0 1,541 4.3 1,666 70.4 28 70.0 9,681 64.3 4,151
- Sample size was too small for a reliable estimate.
1 Includes earnings in summer 1992.
2 Average amount includes only students with loans.
3 Attendance-adjusted total cost minus total aid.
4 Attendance-adjusted budget minus EFC and aid.
5 Not applicable.
NOTE: Totals include students with missing data on characteristics shown in the detail. Therefore, the percentages or amounts for all students may be higher or lower than any of the percentages or amounts shown in the detail.
SOURCE: U.S. Department of Education, National Center for Education Statistics, 1992-93 National Postsecondary Student Aid Study (NPSAS:93), Undergraduate Data Analysis System.
Loans and Work
Full-time, full-year low income students who borrowed were more likely than students who did not borrow to work, perhaps reflecting their greater need for funds. However, the amount of time worked while enrolled was about the same whether students borrowed or not: among low income students who attended full time, full year, students who did not borrow worked an average of 23 hours per week when enrolled, and those who did borrow worked an average of 22 hours.
Parental Contributions and Work
Low income students attending full time, full year who received less than $1,000 from their parents worked more while enrolled, on average (23 hours per week), than those who received $1,000 or more from their parents (19 hours). This suggests that when parents are unable or unwilling to contribute, students work more.