On Feb. 21, the White House announced $1.2 billion in student loan relief for nearly 153,000 borrowers, as part of President Joe Biden’s Saving on a Valuable Education (SAVE) Plan. The Biden administration’s latest executive actions amount to up to $20,000 in student loan debt being canceled for eligible borrowers. As of February, 7.5 million borrowers have enrolled in SAVE, 4.3 million of whom have a $0 monthly payment.
Senior Cheryl Smith applied to colleges in the fall and expressed how the financial component played a significant role in where she applied. She praised this latest presidential action.
“I think this is a major step in relieving students of college loans. I know that many people struggle to pay off college loans even after graduation. It may be a small amount, resting at around $8,000 per person, but I think the SAVE plan has the potential for growth and within a few years. Hopefully they’ll be able to relieve more people of their student loans,” Smith said.
Biden’s latest action follows the delayed rollout of the 2024-25 Free Application for Federal Student Aid (FAFSA) form, which was released on Dec. 31, 2023 and included several reforms. Some important changes to this year’s FAFSA include: the length of the form, questions asked, the calculation of the Student Aid Index (SAI) and the expansion of the Federal Pell Grant program. California’s Assembly Bill 469, passed in 2021, mandated that all seniors complete a financial aid application or an opt-out form.
In past years, FAFSA opened on Oct. 1, prior to most college application deadlines. However, due to this year’s delays, colleges will not receive FAFSA data until early March, posing delays in financial aid packages sent to this year’s applicant pool. In fact, the University of California (UC) announced in early February that all UC campuses will be extending their Statement of Intent to Register (SIR) deadline for first-year undergraduate students to May 15, two weeks after the usual deadline of May 1.
This year’s FAFSA changes and ongoing debates around student loan forgiveness come amid record-high tuition costs and declines in state funding for many public institutions.
According to Columbia Broadcasting System (CBS) News, “The published price for tuition and fees has increased 102% at public four-year institutions, adjusted for inflation, with net tuition and fees at public four-year schools running 115% higher in the last 20 years.”
These rising costs of higher education can be attributed to a variety of factors including rising numbers of administrative staff, market forces such as inflation and popular demand to attend a prestigious university.
“Average tuition costs have generally increased due to overall economic trends of inflation and rising costs of living,” economics and United States history teacher Vi Le said. “Rising costs can also be linked to controversial increases in salaries of administrative staff and presidents of colleges and universities, which essentially puts more money into the pockets of those in power while asking for students to pay more for their higher education.”
In response, several states have increased investments in community college, a less expensive form of higher education, and for many, a more economical choice.
Junior Dylan Moore discussed how the rising costs in tuition are affecting his post-high school plans, as he prepares to apply for college next year.
“For a four-year college each year, the tuition is just way too much to be reasonable,” Moore said. “I think community college offers a good educational experience for the first two years of college, which is why I am considering doing that.”
In the state of California, the first two years of community college are free for all California residents, as part of the California College Promise Innovation Grant first passed in 2017 and signed into law by then-Governor Jerry Brown.
According to California Community Colleges (CCC), “The California College Promise Grant, formerly known as the Board of Governors Fee Waiver, serves more than 1 million California community college students each year.”
Similar programs have since expanded to other states, with each state taking a different approach. Some programs have more limitations and others have more flexibility. In total, 32 states have passed some type of free college tuition program as of February 2024.
Discussions surrounding the value of a college education continue to be top of mind for many families, legislators and activists. A Gallup poll conducted in July 2023 found that Americans’ confidence in higher education has fallen to 36%, which is sharply lower than in 2015 (57%) and 2018 (48%).
Proponents of college education will point to generally higher post-graduation salaries than for non-college educated Americans. For instance, according to a report by Georgetown University’s Center on Education and the Workforce (CEW), bachelor’s degree holders earn a median of $2.8 million during their career, 75% more than if they had only a high school diploma.
On the other hand, opponents will point out how the benefits to a college degree do not outweigh its costs. According to Business Insider, “skyrocketing tuition costs, a boom in demand for workers and political divisions feeding into college campuses, are all reasons people may be forgoing college.” This has even led some state governors, such as Democrat Wes Moore of Maryland and Republican Spencer Cox of Utah, to spearhead initiatives that loosen college degree requirements in order to fill labor shortages in state government, public education and even at some private companies.
As the cost of college continues to rise incrementally each year, conversations surrounding the value of college will continue to be held by families and policymakers alike.
For the latest news on FAFSA and other federal student aid updates, please visit the United States Department of Education’s Financial Aid Toolkit. This can be found at https://financialaidtoolkit.ed.gov/tk/learn/fafsa/updates.jsp.
