A recent survey by ScholarshipOwl paints a troubling picture of Gen Z's financial outlook. The survey, which polled 8,932 high school and college students, found that a staggering number are relying heavily on student loans and credit cards to fund their education.
This alarming trend is a direct consequence of the skyrocketing cost of higher education, forcing many students to shoulder significant debt burdens.
Key Findings from the Survey:
- Overwhelming reliance on loans: 75% of respondents indicated they plan to take out loans to help pay for college.
- Credit card usage: 37% of students have a credit card they use for college-related expenses.
- Federal student loans: The most popular type of loan, with 66% of respondents planning to use them.
- Credit card expenses: Common charges include tuition, fees, rent, books, supplies, and living expenses.
The Growing Burden of Student Debt:
The survey data highlights the growing burden of student debt among Gen Z. According to the Education Data Initiative, students who take out loans graduate with an average of over $40,000 in debt. This figure can be even higher due to interest and penalties.
How Gen Z Students Can Afford College Without Debt:
To mitigate the financial burden of higher education, Gen Z students should consider the following strategies:
- Prioritize scholarship applications: Use platforms like ScholarshipOwl to find and apply for scholarships throughout the year.
- Work part-time or full-time during breaks: Save your earnings to contribute to college costs.
- Submit the FAFSA: Complete the Free Application for Federal Student Aid (FAFSA) annually to qualify for federal and state grants.
- Compare financial aid offers: Choose the college that offers the most affordable package, considering scholarships and grants.
- Avoid "funding the gap" with loans: Explore debt-free options like work-study programs or part-time jobs.
- Delay credit card use: Avoid unnecessary credit card debt until after graduation.
By implementing these strategies, Gen Z students can make informed decisions about their education and reduce their reliance on loans and credit cards, ultimately achieving a more financially sustainable path to higher education.
