It’s no secret that students are graduating from college in serious debt. With the average student loan balance coming in at $29,000, states are trying to find solutions to help keep graduates from being plagued by debt that will then hinder them from investing in a house, buying a car, or even starting a family.
With that in mind, California lawmakers asked the nonpartisan Legislative Analyst’s Office (LAO) to figure out how much money is needed to start a state financial aid program that would assist with paying for college. According to the LAO, the total budget for the program: $3.3 billion.
According to NBC San Diego, the proposed Debt Free College program would be for California residents who attend college full-time at the California Community Colleges (CCC), University of California, and California State University. The hope is that the program would pick up the tab for tuition and living expenses, although this shouldn’t be confused with a tuition-free program. Instead, it would cover the amount left over once other factors such as parent contribution, student contribution, and free federal aid have been deducted.
The amount that parents should contribute is figured out in the same way that federal financial aid programs are calculated. The expectation for students is that they would work 15 hours a week during the school year and 40 hours per week during summer break. Despite this expectation, the state could not force students to get a job. Students who choose to work less or not at all would then have to take out a private student loan from a bank or lender to cover any additional educational costs.
While the cost of the Debt Free College Program could change if eligibility requirements were added, the LAO also suggested combining all of the state financial aid programs available for students and families to create one program, similar to what Oregon and Minnesota have done.
image copyright John Hyun