Survey of 1,000 students nationwide finds both negative and positive sides of school shutdowns
Washington, DC, May 14 – High school students across the country are emerging from a year of COVID-19 school shutdowns with a range of reactions to online learning, making pragmatic plans for higher education, and taking action to save for it. Additionally, in responding to the economic uncertainty wreaked by COVID-19 on their higher education financing plans, students shifted their directions towards public four-year schools, community colleges, technical and career schools and apprenticeships. These are among the many findings of College Savings Foundation’s (CSF) 12th Annual Youth Survey of sophomores, juniors and seniors in high schools across the country.
In keeping with the higher savings rate overall, the students demonstrated sound financial planning with a majority, 56%, saving for higher education – up from 48% in last year’s CSF survey. These savers included 23% using 529 higher education savings plans as their primary way to save, up from 20% last year.
“Despite the challenges that students faced this year, they are looking ahead to building better futures, both by saving for higher education and opening their sights to a wider range of college and career options. We are also pleased to know that students understand the value of 529 higher education plans in achieving these aspirations,” said Vivian Tsai, Chair of CSF, a national nonprofit helping American families save for higher education.
Parents, too, are saving for their children’s higher education, with 69% of students reporting that their parents were saving and 23% of those were using 529s as their primary saving vehicle.
The survey revealed another use of 529s during the last year. When the vast majority, 83%, of students’ high schools closed, 13% of them switched to a private school. Nearly half of those students’ private tuition, 49%, were funded by 529 plans which allow for up to $10,000 per year to be used for funding K-12 education.
How Higher Ed Financing was Changed by COVID-19’s Economic Uncertainties
On the topic of overall higher education financing, over half, 51%, of students said that economic uncertainty had affected their plans. Of those impacted, 53% of them said that their parents were laid off and will have less saved for college, and 44% of them said they would need to take on debt to cover the costs of education.
Among those students whose financing plans changed, here’s how they anticipate those changes to affect their higher education plans: