The cost of higher education continues to be a significant financial burden for American families. In the 2025-2026 academic year, the average family spent $34,019 on college expenses, which marks a 10% increase from the $30,837 spent in the prior year. This figure encompasses tuition, fees, books, room and board, and other related costs. A report by J.P. Morgan Asset Management indicates that college tuition has risen approximately 5.5% annually, outpacing both inflation and wage growth, largely due to decreased state financial support for colleges and increased reliance on tuition revenue, as well as institutional spending on faculty, capital improvements, and student recruitment.
To cover these rising costs, families employ a variety of funding sources. Parent income and savings represent the largest share, covering 39% of expenses, or an average of $13,087. Scholarships and grants provide substantial relief, covering 27% of costs, averaging $9,263. Student loans account for 11% ($3,793), while parent loans cover another 11% ($3,734). Student income and savings contribute 10% ($3,536), and gifts from friends or family make up 2% ($604). Overall, nearly half (47%) of families borrowed money for college in 2025-2026, with 68% of these families having planned to borrow from the outset.
Despite the high sticker prices, many families do not pay the full advertised cost. Only 39% of families reported paying the full price, while half paid less. For instance, the published cost of attendance at private colleges exceeded $65,000 in 2025-2026, but the average net price after aid for tuition and fees for first-time, full-time students at private, nonprofit colleges was $16,910. The reliance on borrowing has led to concerns, with 58% of families believing that unlimited federal student lending contributes to rising costs, and 66% supporting limits on federal student loan debt.
