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How Low Income Undergraduates Financed Postsecondary Education:1992-93


Sources of Support Other Than Financial Aid

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.

Parental Support

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).

Work

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

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.



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