Many Americans endure their first debts when transitioning from high school to college; with higher education comes higher costs and with increased freedom comes the freedom to spend. Between the one-two punch of student loans and tempting credit cards -- coupled with spending on common expenses such as lodging, food and textbooks -- student debt saddles the majority of graduates the moment they throw their caps.
Student Loan Debt
Because lenders are willing to loan vulnerable students more money than they can comfortably repay, the "Wall Street Journal" reports that half of all graduating students carried loan debt in 2010. According to 2009 data from The Project on Student Debt, the average graduating college senior carried an average of $24,000 in student loan debt, a 6 percent increase from 2008. Loan debt varies greatly per state; according to the same report, the District of Columbia was home to students deepest in dept with an average loan debt of $30,033 per student while Utah students experienced an average debt of only $12,860.
Credit Card Debt
A 2009 study by Sallie Mae reports that one in five graduating college students owes a least $7,000 worth of credit card debt. The same study says that 17 percent paid their bills in full each month, 22 percent made only the minimum payment and 82 percent -- as compared to the national average of 50 percent -- carried the balance every month. That same year, nine out of 10 students used credit cards to pay for school expenses.
Spending Habits
According to a nationwide study released by Westwood College for the 2008-2009 academic year, the average university student spends 26 percent of her budget on room and board, but a whopping 40 percent goes to discretionary spending such as entertainment, travel and clothes. Nineteen percent of the average student's budget goes toward tuition and fees. Students spend 8 percent of their remaining budget on health care and other expenses, 4 percent on books and supplies (the average college textbook cost $57 during the '08-09 school year) and 3 percent on transportation . The same report notes that students received a mean of $312 per month from home and earned a mean of $453 per month.
Financial Help
As the cost of being a student rose dramatically in the first part of the 21st century, so did the availability of grants and financial aid. Federal student aid serves as the most prominent source of financial help. The federal government offers Pell Grants, which need not be repaid; these grants helped nine million students in 2009. Students can take advantage of Pell Grants, federal loans, the American Opportunity Tax Credit and other assistance by filling out the Free Application for Federal Student Aid. Each college and university also offers its own individual aid programs, from scholarships to meal plan stipends. Inquire at your admissions office for details and application materials.
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