Does Parents Divorce Translate Into More Student Loan Debt?
A study conducted by researchers at Rice University and the University of Wisconsin and published in the December 2010 issue of the Journal of Family Issues concludes that college students whose parents are divorced or remarried receive less financial support from their parents than do students who remain married to each other.
The study, which examined 2,400 dependent undergraduate college students, concludes that students of divorced and remarried parents have to pay more of their own college expenses and may require more student loans and/or personal income to remain in school.
The researchers found that divorced parents contribute only about one-third of what married parents contribute to their children’s college costs. Parents who divorced and remarried contribute about half of what parents whose marriages remained intact provide for their college-age children. The drop in student financial support was apparent even though family incomes among the study groups were similar.
Married parents contributed about 8 percent of their annual income to their college-age students and met more than three-fourths of their students’ financial needs, either through income, college savings, parent loans, or other means.
Divorced parents contributed about 6 percent of their income to their children’s college expenses, but met only 42 percent of their student’s financial needs. Remarried parents contributed about 5 percent of their income and met 53 percent of their student’s college expenses.
The study also examined the impact of divorce agreements that call upon parents to contribute to their adult children’s college expenses. Based on their analysis, the researchers conclude that college students who come from states where these types of divorce agreements are permitted do not benefit in a meaningful way from the added potential financial support once they reach the age of majority.
Reduced family financial contributions may or may not result in more grant-based tuition assistance from a school, depending on the family’s financial circumstances. Families with more than one child in college or with parents who are returning to school at the same time as their children may qualify for more need-based financial aid, but often, this extra need-based assistance comes in the form of additional student loans.
Most colleges and universities expect a divorced parent to contribute to the child’s college costs. If the divorced parent doesn’t contribute what the school expects, the student is left to make up the difference, whether by borrowing more money in college loans, seeking out college scholarships, or taking on a full- or part-time job while in school.
Another caveat: Some colleges may refuse to provide student aid without income information from both parents, regardless of the parents’ marital status. When divorced parents won’t cooperate or disclose their financial information for their child’s financial aid application, the student could end up on the short end of the financial aid stick.
Other schools will include parent loans in a student’s financial aid package, whether or not one or both parents agree or are willing to take on any parent loans. Families aren’t required to accept parent loans as part of their financial aid package, but refusing a parent loan means that the student has to find that money elsewhere: The student may end up with a larger school loan debt burden or be left to generate more personal income through a full- or part-time job to make up the difference.
The authors of the study say that their findings should encourage college-bound students of divorced and remarried parents to assess their financial situations carefully, since the research indicates that the cost of attending college is clearly shifted to the student when parents are divorced or remarried.
The authors caution that these students of divorced or remarried parents may be at a disadvantage academically as they take on more of the burden of financing their own education, forced to spend more time trying to find scholarships, securing student loans, and shouldering the demands of an in-school job, with less time left to concentrate on their studies.