Research by Public Agenda, Prepared for the Bill & Melinda Gates Foundation

MYTH No. 2: Most college students are supported by their parents and take advantage of a multitude of available loans, scholarships, and savings plans.

REALITY No. 2: Young people who fail to finish college are often going it alone financially. They’re essentially putting themselves through school.

According to one recent analysis, college costs have risen more than 400 percent in the last 25 years, while the median family income has increased less than 150 percent.1 And even though the pressure of having to balance the demands of a job and school is the major reason young people say they drop out of college, it would be misleading to dismiss the role of rising college costs and stagnant family incomes. National statistics show that young people who leave college without a degree are more likely than their peers to come from less privileged backgrounds and to live in more precarious economic circumstances.2 This study revealed that these students often bear the full responsibility of paying for school: Nearly 6 in 10 students in our study who left higher education without graduating say that they had to pay for college costs themselves, rather than being able to count on help from their families. In contrast, more than 6 in 10 of those who completed their degrees say they had help from parents or other relatives to cover the costs of school.

Young people who fail to finish college are also substantially less likely to have received scholarships or financial aid, loans or even good advice about how to get help. About 7 in 10 of those who leave school report that they did not have scholarships or financial aid, compared with about 4 in 10 of those who graduate. The majority of students (62 percent) who told us that they alone were responsible for paying for college (regardless of whether they dropped out) report that their high school guidance counselors did a poor or only fair job of helping them to understand the college application process. Among students who had financial support from their parents, less than half said the same.

Unfortunately, about 3 in 10 of those young people who leave school without getting a diploma report that they have college loans—money that has to be repaid even though they do not have the financial leg up that a college degree affords. In many respects, they have the worst of both worlds—no diploma, but college loans to repay.

[1] T he National Center for Public Policy and Education, “Measuring Up 2008” report; in Viany Orozco and Nancy K. Cauthen, “Work Less, Study More, & Succeed: How Financial Supports Can Improve Postsecondary Success,” Demos, 2009.

[2] “Employment and Earnings Report,” Bureau of Labor Statistics, August 2009.