Why families spend 70% more on college in New England

 

Parents from the Northeast spend 70% more on colleges than their other regional counterparts, according to a new study from Sallie Mae.

Ipsos administered the telephone survey from March 22nd through April 24th and drew responses from 800 parents of undergraduate students and 800 undergraduate students between the ages of 18 and 24. Participants were asked a series of questions about their use of savings, scholarships, grants, student loans, and other sources of credit to fund undergraduate education.

While there are a number of factors that may contribute to the regional differences in college spending, the Northeastern perception of college as a social symbol is a major influence on their willingness to spend, writes Jillian Berman for MarketWatch.  

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More specifically, Northeastern parents are more interested in attending "rear window sticker colleges," says Andy Lockwood, a financial aid consultant. These are the colleges that are so frequently recommended by guidance counselors or seen in the community that the institutions have developed a "name-brand cache," says Lockwood.

Because families are more concerned with attending a top school, college admissions tends to be "more of a blood sport [for families] in the Northeast," says Anna Ivey, former dean of admissions at the University of Chicago.

But in Ivey's experience, even the definition of "top college" varies across the United States.  Northeastern families perceive private colleges as more elite than their public counterparts, says Ivey. She notes that Southern families, on the other hand, often consider flagship public colleges as top-tier. According to the survey, just 19% of Southern students attended a private four-year college, whereas almost 40% of Northeastern students chose a private university.

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The emphasis on college reputation is just part and parcel of a larger competitive atmosphere in the Northeast, says Lockwood. The draw of elite private colleges contributes to about 62% of Northeastern parents tapping into their income and savings as well as 25% taking out loans, writes Berman.

While Lockwood recommends that parents be upfront early on about a realistic college budget, he says that New England parents are more willing to pay and are "just going to find a way" (Berman, MarketWatch, 7/19).

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