Short Title

Debt Profiles of Model Students


A common misperception suggests that a high-achieving student can easily complete a degree with very limited debt, and that students with high levels of debt are thus underachievers. This assumption is supported by memories of previous decades when it was realistically possible for most students to work their way through college. This view, however, ignores the current financial realities faced by students with limited family support. The financial experience and circumstances of current, high-performing students is markedly different from similarly dedicated students in the past. Current students are now more likely to g raduate with high debt burdens that negatively impact their ability to contribute to the economy and society. This paper examines and describes the likely debt burdens now being incurred by highly productive students in common financial circumstances and projects the likely economic and societal impact of this debt. Using national data sources and theoretical perspectives based in the fields of cost accounting and economics, this study finds that students who enroll with a clear community college-to-university path are more likely to g raduate with lower debt levels. More rapid program completion likewise reduces debt levels. In addition, parental support at half of the cost of attendance reduces debt more than a full Federal Pell Grant. The results point to recommendations to policymakers at the federal, state, and institutional level to focus on providing for efficient transfer between schools, encouraging timing program completion, limiting developmental education requirements, and targeting sufficient funding to public institutions to produce optimal college prices.