NEWARK, DE — U.S. families spent an average of $30,837 on college during the 2024–25 academic year, up 9% from the previous year and back to pre-pandemic spending levels, according to Sallie Mae and Ipsos’ How America Pays for College 2025 report.
Nearly half of those costs (48%) were covered by family income and savings, followed by scholarships and grants (27%), borrowing (23%), and contributions from friends or extended family (2%). The findings suggest families are willing to commit more resources to higher education while remaining attentive to affordability.
The survey found 89% of families view college as a worthwhile investment, and 82% said they would stretch financially to secure the best opportunities for students. Cost remains a significant factor—79% eliminated at least one school due to expense—yet nearly half reported paying less than the advertised sticker price. Proximity to home (40%), affordability (39%), and specific academic programs (39%) ranked as top decision drivers.
While 59% of families created a payment plan before enrollment, only 38% considered graduates’ starting salaries when choosing a school. “Coupling financial planning with expected post-college outcomes could lead to even more informed decisions,” said Annaleise Lohr, vice president at Ipsos.
The report also revealed gaps in financial aid awareness. Although 64% of families said the new FAFSA was easier to complete, completion rates slipped to 71% from 74% a year earlier. Only 21% knew the form opens in October, potentially missing out on limited or first-come, first-served aid. Similarly, 40% did not use scholarships, citing either lack of awareness (34%) or the belief they would not win (28%).
Borrowing remains common—48% of families took out loans, and 72% said they would rather borrow than forgo attendance. More than a third of borrowing families said access to loans led them to consider more expensive schools. Nearly six in 10 believe federal loans contribute to rising tuition costs, and 42% expect federal loan forgiveness.
Rick Castellano, vice president at Sallie Mae, stressed the need for greater transparency in college pricing and more promotion of aid opportunities. “Families shouldn’t leave free money on the table,” he said.
The findings are based on online interviews with 1,000 undergraduate students and 1,000 parents conducted between April 8 and May 8, 2025.
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