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FederalGrant Programsother thanPell
Federal Work-Study
Trends in Higher Education Series
Trends inStudent Aid2011
8/3/2019 Trends in Student Aid 2011, College Board
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TRENDS IN HIGHER EDUCATION SERIES TRENDS IN STUDENT AID 2011 3
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
The American Opportunity Tax Credit (AOTC), implemented in
2009, increased the subsidies provided to students and amilies
through the combination o education tax credits and deductions
rom about $7 billion in 2007-08 to an estimated $14.8 billion in
2009-10 and 2010-11. Like the 2009-10 increases in Pell Grantsand veterans benets reported in Trends in Student Aid 2010,
these unds help students meet the rising costs o attending
college in an era o persistent economic diculties. However,
state grant aid, grants rom employers and other private sources,
and ederal campus-based aid all provided ewer infation-adjusted
dollars per student in 2010-11 than they had three years earlier.
TYPES OF STUDENT AID
In 2010-11, undergraduate students received
an average o $12,455 per ull-time equivalent
(FTE) student in nancial aid, including $6,539 in
grant aid, $4,907 in ederal loans, and $1,009 ina combination o tax credits and deductions and
Federal Work-Study (FWS).
As a result o the introduction o the American Opportunity Tax
Credit in 2009, education tax credits and tuition deductions
per student increased by more than 80% in infation-adjusted
dollars between 2007-08 and 2010-11.
In 2010-11, $227.2 billion in nancial aid was distributed to
undergraduate and graduate students in the orm o grants
rom all sources, Federal Work-Study, ederal loans, and
ederal tax credits and deductions. In addition, students
borrowed an estimated $7.9 billion in loans rom state and
private sources.
FTE graduate students received an average o $23,955 in
aid, including $6,750 in grant aid, $16,423 in ederal loans,
and $782 in a combination o tax credits and deductions and
Federal Work-Study.
From 2009-10 to 2010-11, grant aid per FTE undergraduate
student increased by an estimated 7% ($441 in 2010 dollars),
while the average amount o ederal loans borrowed per FTE
student declined by 2% ($76 in 2010 dollars).
These changes ollowed increases o 20% in average grant
aid per FTE undergraduate student and 10% in average ederal
loans between 2008-09 and 2009-10. Over the three years rom
2007-08 to 2010-11, both grant aid and ederal loans per student
increased by about 30% in infation-adjusted dollars.
Over the decade rom 2000-01 through 2010-11, both grant aid
and ederal loans per FTE undergraduate student increased at
an average rate o about 5% per year ater adjusting or infation.
About 12 million taxpayers beneted rom education tax
credits and deductions in 2009, and a similar number received
this aid in 2010. In 2010-11, 10.3 million postsecondary
students borrowed Staord Loans and 9.1 million received
Pell Grants. Federal campus-based programs reached many
ewer students. There were 1.3 million Federal Supplemental
Educational Opportunity Grant (FSEOG), 713,000 Federal Work-
Study (FWS), and 493,000 Perkins Loan recipients in 2010-11.
SOURCES OF GRANT AID
In 2010-11, 46% o all grant aid (and 51% o
undergraduate grant aid) came rom the ederal
government. Ten years earlier, only 29% o all
grant aid (and 34% o undergraduate grant aid)was ederal.
In 2010-11, 36% o all grant aid came rom colleges and
universities, 9% came rom state governments, and 10%
came rom employers and other private sources.
The maximum ederal Pell Grant o $5,550 was $134 (2%)
higher in constant 2010 dollars in 2010-11 than in 2009-10.
It was $1,387 (33%) higher in 2010-11 than in 2000-01. The
maximum grant did not increase or the 2011-12 academic year.
Although the maximum Pell Grant is the most requently
discussed descriptor o these grants, students must have $0
expected amily contributions and enroll ull-time/ull-year in
order to receive this amount. Only about 22% o recipients
received the maximum grant o $5,350 in 2009-10. In 2010-11,
when the maximum grant was $5,550, the average grant was
$3,828.
Institutional grant aid dollars per FTE undergraduate student
increased at an average rate o about 3.1% per year over the
2000-01 to 2010-11 decade, ater adjusting or infation.
Highlights
AVERAGE AID per FTE Undergraduate Student in Constant
2010 Dollars, 1995-96 to 2010-11
$0
$4,000
$8,000
$2,000
$6,000
AverageAid
inConstant2010Dollars
Academic Year
10-1107-0805-0603-0401-0299-0097-9895-96
Undergraduate Students
$2,967 $2,999$3,759
$4,907$3,346
$3,979$4,706
$6,539Average Grant Aid per FTE
Average Federal Loans per FTE
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4 TRENDS IN STUDENT AID 2011 TRENDS IN HIGHER EDUCATION SERIES
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
DISTRIBUTION OF STUDENT AID
The distribution o subsidies rom ederal
education tax benets changed considerably with
the introduction o the American OpportunityTax Credit in 2009. The percentage o savings
rom credits and deductions going to taxpayers
with incomes below $25,000 increased rom 5%
in 2008 to 17% in 2009. The percentage o savings
going to those with incomes above $100,000
increased rom 18% in 2008 to 26% in 2009.
Unlike other education tax credits, the American Opportunity
Tax Credit is partially reundable or lers who do not owe
taxes. This increases the benets or low-income students and
amilies. At the other end o the spectrum, the income limitis higher on the new credit, reducing the tax liability o many
higher-income taxpayers.
The 31% o FTE undergraduate students enrolled in public
two-year colleges received 32% o the total Pell Grant unds
in 2009-10. The 12% enrolled in or-prot institutions received
25% o all Pell Grants unds.
In 2009-10, 39% o Pell Grant recipients were dependent on
their parents or support, and 63% o these students came
rom amilies with incomes o $30,000 or less.
In 1985-86, 9% o all state grant aid or undergraduate
students was awarded without regard to the students
nancial circumstances. By 2005-06, this percentage had
risen to 28%; it remained constant through the 2009-10
academic year.
State grant programs dier considerably across states. In 14
states (and Puerto Rico), nancial circumstances infuence the
distribution o all state grant aid. Georgia, South Dakota, and
the District o Columbia consider nancial circumstances or
less than 10% o their state grant aid dollars.
Between 90% and 93% o institutional grant aid at the most
selective private nonprot our-year colleges and universities
was used to meet students nancial need in each year rom
2007-08 through 2010-11. At less selective institutions in
this sector, more o the grant aid goes to students without
nancial need.
STUDENT BORROWING
Total education borrowing, including ederal
student and parent loans, as well as nonederal
loans, increased by about 2% rom 2009-10 to2010-11. Borrowing per FTE student declined by
about 2% overall, ater adjusting or infation.
Over the decade rom 2000-01 to 2010-11, total borrowing
increased by 57% per FTE student, including both
graduate and undergraduate students, and by 56% per FTE
undergraduate student.
Estimated education loan borrowing rom private sources
declined or a third consecutive year, and was at about $6
billion in 2010-11, 66% lower than in 2005-06. Other nonederal
borrowing, including loans rom states and institutions,increased slightly, but total nonederal loans declined rom
about $19.9 billion in 2005-06 to $7.9 billion in 2010-11.
In 2010-11, 34% o undergraduates took out Staord Loans.
Twenty-six percent used both subsidized and unsubsidized
loans. In other words, almost three-quarters o all
undergraduate Staord borrowers had both types o loans
and 83% o subsidized borrowers also had unsubsidized loans.
In 2009-10, about 55% o public our-year college students
who graduated rom the institutions at which they began their
studies graduated with debt. They had borrowed an average o
$22,000. About two-thirds o those earning bachelors degrees
rom private nonprot institutions had debt averaging $28,100.
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TRENDS IN HIGHER EDUCATION SERIES TRENDS IN STUDENT AID 2011 5
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
Contents
3 Highlights
6 Ten-Year Trend in Student Aid
and Nonederal Loans per FTE
FIGURE 1 Ten-Year Trend in Student Aid and Nonederal Loans per FTE
7 Introduction
10 Total Student Aid
Adjusted or Infation
TABLE 1 Total Student Aid and Nonederal Loans in Constant Dollars over Time
11 Total Undergraduate and
Graduate Student Aid by Type
FIGURE 2A Undergraduate Student Aid by Source and Type
FIGURE 2B Graduate Student Aid by Source and Type
12 Types o Grants FIGURE 3 Total Federal, Institutional, Private and Employer, and State Grants over Time
13 Types o Loans FIGURE 4 Total Federal and Nonederal Loans over Time
14 Federal Aid Recipients FIGURE 5 Number o Federal Aid Recipients by Program, 2010-11
15 Federal Aid Recipients FIGURE 6 Percentage o Undergraduate Students Borrowing Staord Loans over Time
16 Federal Aid by Sector FIGURE 7 Percentage Distribution o Federal Aid Funds by Sector, 2009-10
17 Total Grants and Total Loans FIGURE 8A Undergraduate Student Grant and Loan Percentages over TimeFIGURE 8B Graduate Student Grant and Loan Percentages over Time
18 Student Debt FIGURE 9A Cumulative Debt Levels o 2009 Bachelors Degree Completers by SectorFIGURE 9B Cumulative Debt Levels o 2009 Bachelors Degree Non-Completers by Sector
19 Student Debt FIGURE 10A Average Debt Levels o Public Sector Bachelors Degree Recipients over TimeFIGURE 10B Average Debt Levels o Private Nonprot Sector Bachelors Degree Recipients
over Time
20 Total Aid per Full-Time
Equivalent Student
FIGURE 11A Average Aid per FTE Undergraduate Student over Time
FIGURE 11B Average Aid per FTE Graduate Student over Time
21 Education Tax Creditsand Tuition Deductions
FIGURE 12A Distribution o Education Tax Benets by AGI, 2008 and 2009FIGURE 12B Total Education Tax Benets over Time
22 Pell Grants FIGURE 13A Pell Grants: Total Expenditures, Maximum and Average Grants, and Numbero Recipients over Time
FIGURE 13B Maximum and Average Pell Grant over Time
FIGURE 13C Maximum Pell Grant as Percentage o Total Charges over Time
23 Pell Grants FIGURE 14A Total Enrollment and Percentage Receiving Pell Grants over TimeFIGURE 14B Percentages o Students and o Aid Applicants Receiving Pell Grants, 2007-08
24 State Grants FIGURE 15A Need-Based and Non-Need-Based State Grants per FTE Student over TimeFIGURE 15B Percentage o State Grants Based on Need by State, 2009-10
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6 TRENDS IN STUDENT AID 2011 TRENDS IN HIGHER EDUCATION SERIES
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
FIGURE 1 Ten-Year Trend in Student Aid and Nonederal Loans per Full-Time Equivalent (FTE) Student Used to Finance
Postsecondary Education Expenses in Constant 2010 Dollars, 2000-01 to 2010-11
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
10-1109-1008-0907-0806-0705-0604-0503-0402-0301-0200-01
Academic Year
Constant2010Dollars
Federal Campus-Based Programs
Nonfederal Student Loans
Education Tax Benets
Unsubsidized FederalStafford Loans
Subsidized FederalStafford Loans
Private and Employer Grants
Institutional Grants
Federal Pell Grants
State Grants
Federal Parent Loans (PLUS)and Grad PLUS Loans
Other Federal Programs
Total nancial aid per ull-time equivalent (FTE) student increased 62%, rom $8,567 (in constant 2010dollars) in 2000-01 to $13,914 in 2010-11. In addition, students borrowed an average o about $563 per
FTE in 2000-01 and about $482 in 2010-11 rom nonederal sources.
NOTE: See Notes and Sources or a list o programs included in other ederal programs.
SOURCE: Table 1.
Contents Continued
25 State Grants FIGURE 16A State Grant Expenditures as Percentage o Total State Support or HigherEducation, 2009-10
FIGURE 16B State Grant per FTE Undergraduate, 2009-10
26 Institutional Grant Aid
Public Institutions
FIGURE 17A Public Sector Institutional Grant Aid over Time
27 Institutional Grant Aid
Private Institutions
FIGURE 17B Private Nonprot Sector Institutional Grant Aid over Time
28 College Savings Plans FIGURE 18 Section 529 College Savings Plan Assets over Time
29 Notes and Sources
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TRENDS IN HIGHER EDUCATION SERIES TRENDS IN STUDENT AID 2011 7
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
In an era o persistently high unemployment, amily incomes
that ail to keep up with infation, savings that have been eroded
by declining stock market values, and rising college prices,
student nancial aid is more important than ever. Despite
prevalent questions about whether and or whom college is
really worth it, most people agree that their lives and theirchildrens lives will be much easier i they successully complete
postsecondary credentials. Without a strong and well-designed
system o subsidies or students, these opportunities are out
o reach or many who could benet rom them. Moreover, it is
increasingly evident that the complexities o existing nancial aid
policies and programs make it dicult or many o those who
most need the help to understand and navigate the system.
The array o programs that provide nancial aid has evolved in
recent years, with some o the changes receiving considerable
attention and others going relatively unnoticed. Trends in
Student Aid 2010reported on a 67% increase in expenditures
(in constant dollars) or the Pell Grant program, the ederal
governments oundation unding or low-income collegestudents. The increase resulted rom a combination o legislated
changes designed to cushion the impact o the recession
on students, deterioration in the nancial circumstances o
students and amilies that generated increased nancial need,
and growth in enrollments as a result o weakened labor market
opportunities. Over the past year, Pell Grants have received quite
a bit o attention rom Congress, rom the Obama administration,
and rom the media. Questions about the sustainability o this
program as currently structured must be addressed even as the
centrality o the program in supporting the national goals or
increasing educational attainment becomes clearer.
This year, the most notable increase in subsidies or students on
which we report came through changes in the tax code. Since1998, students and parents have beneted rom education tax
credits, through which the ederal government reimburses them
or part o the tuition they have paid. Since 2002, there has also
been a deduction in the ederal income tax code that subsidizes
tuition payments or some taxpayers. With the introduction o the
American Opportunity Tax Credit in 2009, the subsidies available
through the tax code a contribution o the ederal government
to college expenses increased rom an estimated $6.8 billion in
2008 to $14.7 billion in 2009 (the latest tax year or which data are
available). Unlike Pell Grants, the subsidies the ederal government
provides through the tax code are not based on ability to pay. The
new tax credit increased the proportion o the benets going to
low-income students by introducing reundability, allowing those
with no tax liability to benet. But taxpayers with incomes up to
$180,000 are eligible or the new credit, and the percentage o
the tax savings going to taxpayers with incomes above $100,000
increased rom 18% to 26% in one year.
Trends in Student Aidprovides inormation on these and other
developments in college nancing patterns.
TRENDS IN STUDENT AID
Trends in Student Aid, an annual College Board publication
since 1983, is a compendium o detailed, up-to-date inormation
on the unding that is available to help students pay or college.
This report sorts aid into grants, loans, tax benets, and Federal
Work-Study assistance. It documents unding rom ederal
and state governments, colleges and universities, employers,
and other private sources. It examines changes in unding
levels over time, reports on the distribution o aid across
students with dierent incomes and attending dierent types o
institutions, and tracks the debt students incur as they pursuethe educational opportunities that can increase their earnings,
open doors to new experiences, and improve their ability to
adapt to an ever-changing society.
Trends in Student Aiddoes not attempt to evaluate student aid
programs or policies; rather, it provides detailed inormation
that can inorm policymakers, researchers, and others in their
eorts to assess and improve the eectiveness o student
aid. The accompanying website makes data easily available
or reerence and downloading. The text that accompanies the
graphs and tables in Trends in Student Aiddoes not summarize
all o the inormation reported, but it points to key ideas and
should help readers to interpret the data.
Trends in College Pricing, a companion report, relies on data
rom the College Boards Annual Survey o Colleges(ASC) to
provide inormation on changes in undergraduate tuition and
ees, room and board, and other estimated expenses related
to attending colleges and universities. Although data or Trends
in Student Aid 2011 extend through the 2010-11 academic
year, Trends in College Pricing 2011 includes inormation on
published prices or the 2011-12 academic year.
TOTAL STUDENT AID
Table 1 reports on the total unds available to postsecondary
students, both undergraduate and graduate, to supplement
amily and student payments over the decade rom 2000-01
to 2010-11. Together with students savings and earnings, aswell as support rom parental earnings, savings, and borrowing
rom other sources, these unds contribute to making higher
education nancially accessible. Increases in total unds are
important indicators o the resources being devoted to student
assistance. But these gures may create an overly optimistic
view o the benets available to individual students because
they dont account or increases in the number o students.
Figure 1 shows the unds detailed in Table 1 both student aid
dollars and the money students borrow rom nonederal sources
on a per-FTE-student basis. Between 2000-01 and 2010-11,
total FTE postsecondary enrollment increased by 43%, with
4.3 million more FTE undergraduates and over 600,000 more
graduate students enrolled at the end o the decade. The 132%
increase (ater adjusting or infation) in total nancial aid over
the decade amounted to a 62% increase in aid per FTE student.
The gures in Table 1 have been adjusted or infation. Similar
tables in current dollars (unadjusted), broken down between
undergraduate and graduate students, and including data back
to 1963, are available online.
TYPES OF STUDENT AID
From the students perspective, grant aid, which is a pure
subsidy not requiring repayment, is the most desirable orm
o nancial aid. Education tax credits and deductions are also
Introduction
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8 TRENDS IN STUDENT AID 2011 TRENDS IN HIGHER EDUCATION SERIES
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
pure subsidies, although the act that the savings generally
materialize months ater the bills have been paid makes them
less eective in acilitating college access.
A variety o orms o loans are described in this publication.
Subsidized Staord Loans and Perkins Loans provide thegreatest benet or students because the government pays the
interest while the student is in school. Unsubsidized Staord
Loans and PLUS Loans or parents o undergraduate students
and or graduate students also carry a ederal guarantee and
interest rates that are controlled by legislation. In contrast,
nonederal education loans rom banks and other lending
institutions and, on a smaller scale, states and postsecondary
institutions, are generally not subsidized at all. Their value is
in providing liquidity or students who have no other means
o accessing unds. We report on nonederal student loans
because o their importance, but we do not include them in our
measures o student aid because they do not carry subsidies.
A small amount o student aid comes rom the Federal Work-Study (FWS) Program, under which the ederal government
provides unds to institutions to subsidize the wages they pay
to some student workers with documented nancial need.
Although these unds are packaged along with grants and loans
to help students pay their bills, rom the students perspective,
they are wages received or services perormed.
As Figures 2A and 2B reveal, the composition o aid received
by graduate students is quite dierent rom the composition
o the aid on which undergraduates rely. Grants constituted
53% o the aid received by undergraduates in 2010-11, but only
28% o the aid received by graduate students. Federal loans
made up 69% o graduate student aid, compared to 39% o
undergraduate aid. The teaching and research assistantshipsrom which many graduate students benet are a orm o
compensation and are not included here.
FEDERAL AID
The allocation o ederal student aid unds diers across
programs. Need-based aid relies on the inormation provided
by students and parents on the Free Application or Federal
Student Aid (FAFSA) and the ormula known as Federal
Methodology (FM). Pell Grants are distributed based on
the expected amily contribution (EFC) determined by this
ormula and do not depend on the charges at the particular
school attended. Subsidized Staord Loan eligibility is based
on both the EFC and the cost o attendance at the students
institution. A subsidized Staord Loan recipient attending a
high-priced institution might not have received that loan had
she opted instead or a less expensive institution. Campus-
based ederal unds including FWS, Federal Supplemental
Educational Opportunity Grants (FSEOG), and Perkins Loans
are also need-based. However, these unds are distributed to
institutions based on a complex ormula, and the institutions
allocate them to students with nancial need. Unsubsidized
Staord Loans are available to all students regardless o their
nancial circumstances; PLUS Loans require only the absence
o adverse credit, a criterion that has aected more applicants
in recent years. Figure 7 illustrates the distribution o these
various orms o aid to students at dierent types o institutions.
GRANT AID
Grant aid comes rom the ederal government, state
governments, employers and other private sources, and rom
colleges and universities in the orm o discounts rom the
published price. As Figure 3 shows, ederal grants, which
accounted or 29% to 34% o total grant aid rom 2000-01through 2008-09, increased to 44% in 2009-10 and 46% in
2010-11. Despite increasing by 86% (in constant dollars) over
the decade, institutional grants declined rom 43% o the total
in 2000-01 to 41% in 2005-06, and to 36% in 2010-11. Even with
strained state budgets and declining unding or higher education
in many states, total state grant unds, which declined by 1% (in
constant dollars) between 2007-08 and 2008-09, increased by
9% between 2008-09 and 2009-10, and by 2% between 2009-
10 and 2010-11. Figures 15B and 16B detail some o the variation
across states in their grant unding or college students.
Students whose amily incomes are too low to generate any
expected amily contribution qualiy or the maximum Pell
Grant, which is the most requently cited descriptor o Pellunding levels. About two-thirds o 2009-10 Pell Grant recipients
qualied or the maximum grant o $5,350, but only about 28%
both qualied and enrolled ull-time, ull-year, actually receiving
this amount. The average grant is a better representation o
the subsidy received by the typical Pell Grant recipient. In
2010-11, when the maximum Pell Grant was $5,550, 9.1 million
students received an average o $3,828 rom the program.
This distinction will be particularly important to keep in mind as
discussions continue about how to protect the Pell program as
the ederal government seeks decit-reducing savings.
In addition to total and per-student amounts o grant aid,
Trends in Student Aidreports on the distribution o grant aid
among students. Some students have the nancial resourcesnecessary to pay tuition and ees, as well as other costs
associated with going to college, without serious diculty. For
many others, postsecondary education would be out o the
question without generous subsidies. As both college prices
and the other expenses associated with college attendance
continue to rise more rapidly than income, more students and
potential students all into the second category.
Federal grants are targeted at low- and moderate-income
students, but both states and institutions requently consider
actors other than, or in addition to, nancial circumstances
in allocating their aid. Figures 15A and 15B show changes
over time and variation across states in the distribution o
need-based and non-need-based grant aid. The trend toward
allocating state grants without regard to nancial circumstances
has leveled o, and 14 states consider ability to pay in the
allocation o all o their grant unds. Figures 17A and 17B put a
similar ocus on institutional grants.
LOANS
The ederal government is the primary source o education loans
and oers several dierent types o loans. As o July 1, 2010,
the ederal government no longer guarantees education loans
made by banks and other private lenders, but unds these loans
through the Federal Direct Student Loan Program (FDSLP). Major
ederal education loan programs include those or undergraduate
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TRENDS IN HIGHER EDUCATION SERIES TRENDS IN STUDENT AID 2011 9
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students with documented nancial need (subsidized
Staord Loans), or all undergraduate and graduate students
(unsubsidized Staord Loans), or graduate students only
(GradPLUS), or parents (PLUS), and or students with high need
at some institutions (Perkins). The conditions and interest rates
vary by program. As part o the August 2011 debt ceiling deal,the ederal government eliminated in-school interest subsidies
on Staord Loans or graduate students. Although a portion o
Staord Loans or some undergraduates will still be interest-ree
while they are in school, beginning in 2012-13 interest will accrue
on all o the loans taken by graduate students.
O particular importance are the available repayment options
and consumer protections. The Income-Based Repayment (IBR)
plan limits required payments to a manageable percentage o
income above 150% o the poverty line. I more students took
advantage o this option, inadequate earnings would not lead
them to deault on their student loans.
The private loan market is an important supplementary sourceo unds or students, but the loans generally have higher
interest rates over the long term and less avorable repayment
terms than ederal loans. For example, they are not covered
by the ederal IBR plan. The recent diculties acing credit
markets in general, combined with increases in the availability
o ederal student loans, are refected in diminished use o
private education loans. There is no reliable source or exact
inormation on total borrowing rom these sources. Since 1995-
96, the College Board Trendssta has conducted an annual
survey o private lenders to compile the best possible estimate
o this lending. This year, we beneted rom the assistance
o the Consumer Bankers Association, which provided the
inormation on total private student loans compiled through
MeasureOne. We also surveyed the major credit unions thatextend student loans to obtain a national estimate rom these
lenders. The totals or nonederal loans also include inormation
rom states on the loans they make to students.
This year, or the rst time, we include an estimate o the
loans that institutions provide to their students. The National
Association o Student Financial Aid Administrators (NASFAA)
worked with us to survey its members and to collect data on the
volume o institutional lending in recent years. Combining these
data with inormation rom the National Postsecondary Student
Aid Study(NPSAS), we estimate that students borrowed about
$720 million rom their institutions in 2010-11. Like our estimates
o institutional grant aid and grants rom private sources
(compiled with the assistance o the National Scholarship
Providers Association) our estimates in this area are less precise
than most o the data we report on student nancial aid.
Interpreting the growth in total education loan volume is
dicult because it is in part a refection o increases in
enrollment and declines in the availability o other appealing
sources o borrowing, such as home equity loans. The real
concern about student loans is the amount o debt that
individual students accumulate. Student loans make it possible
or many students who could not otherwise pay or college to
gain the postsecondary experience they need to improve their
lie prospects. Just as most small business start-ups would be
impossible to launch without loans that can be repaid out o
uture earnings, many students would be unable to invest in
themselves without debt nancing. Although postsecondary
education has a higher success rate in terms o uture earnings
than small businesses, excessive debt and barriers to managing
that debt create major diculties or many students. TheIncome-Based Repayment plan has the potential to signicantly
diminish the hardships acing students. However, even i all
students or whom it would be helpul participated, at least
as currently structured, IBR would not eliminate all o the
problems related to student debt.
New data rom the NCES Beginning Postsecondary Students
Longitudinal Study(BPS) allow us to examine not only the
debt levels o college graduates, but also o those who let
school without a degree. Figure 9 reports that among students
beginning their studies in 2003-04, about 19% o bachelors
degree completers and about 13% o students who last
attended a our-year institution but did not complete a bachelors
degree accumulated more than $28,000 in student debt.There is considerable variation across sectors, both in terms o
how many students complete their degrees and in terms o debt
levels. Among dependent students who last attended a our-year
or-prot institution, 15% had earned bachelors degrees by 2009.
Two-thirds o these graduates had at least $28,000 in education
debt. About 15% o dependent and 16% o independent
students who last attended a our-year or-prot institution, but
did not earn a bachelors degree, borrowed more than $28,000.
Figure 10 tracks over time the average debt levels o bachelors
degree recipients in the public and private nonprot sectors who
earned their degrees at the institutions at which they began
their studies, and indicates that about 56% o these public
our-year college graduates now complete their undergraduatestudies with student debt averaging about $22,000.
THE CONSUMER PRICE INDEX
We provide much o our data in constant dollars, adjusting
values or changes in the Consumer Price Index (CPI). We use
the change in the CPI rom July 2009 to July 2010 to compare
the value o aid in 2009-10 to the value in 2010-11. While the
CPI adjustment is necessary to make meaningul comparisons
o values over long periods o time, comparisons o one-year
changes in constant dollars may be conusing. Recent large
fuctuations in energy prices have led to an unusually volatile CPI.
The 5.6% increase in the CPI rom July 2007 to July 2008 was
the highest annual infation rate since 1982. As a result, constant
dollar increases or 2008 were small relative to current dollar
increases. Between July 2008 and July 2009, the CPI declined by
2.1%, which resulted in constant dollar increases that were larger
than current dollar increases. The CPI increased by 1.2% between
July 2009 and July 2010, and by 3.6% rom 2010 to 2011.
The tables supporting all o the graphs in theTrends publications,
PDF versions o the publications, PowerPoint fles containing
individual slides or all o the graphs, and other detailed data
on student aid and college pricing are available on our website
athttp://trends.collegeboard.org. Please eel ree to cite or
reproduce the data in Trends or noncommercial purposes with
proper attribution.
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10 TRENDS IN STUDENT AID 2011 TRENDS IN HIGHER EDUCATION SERIES
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
Total Student Aid Adjusted or Infation
TABLE 1 Total Student Aid and Nonederal Loans Used to Finance Postsecondary Education Expenses in Constant 2010
Dollars (in Millions), 2000-01 to 2010-11
Academic Year
00-01 01-02 02-03 03-04 04-05 05-06 06-07 07-08 08-09 09-10Preliminary
10-1110-Year
% Change
Federal ProgramsGrants
Pell Grants $10,038 $12,252 $14,092 $15,065 $15,136 $14,162 $13,731 $15,361 $18,129 $30,362 $34,762 246%SEOG $796 $849 $878 $901 $887 $869 $826 $807 $751 $767 $758 -5%LEAP $50 $68 $80 $78 $76 $73 $69 $68 $63 $64 $64 26%Academic Competitiveness Grants $259 $323 $337 $485 $548
SMART Grants $220 $214 $198 $363 $384Veterans $2,074 $2,313 $2,800 $3,149 $3,467 $3,544 $3,530 $3,639 $4,147 $8,621 $10,872 424%Military and Other Grants $1,105 $1,221 $1,271 $1,517 $1,685 $1,674 $1,729 $1,790 $1,775 $1,785 $1,678 52%Total Federal Grants $14,064 $16,702 $19,120 $20,711 $21,251 $20,321 $20,364 $22,202 $25,399 $42,448 $49,065 249%
LoansPerkins Loans $1,444 $1,522 $1,768 $1,942 $1,901 $1,778 $1,734 $1,448 $953 $828 $971 -33%Subsidized Staord $20,669 $21,361 $23,641 $26,127 $27,425 $27,268 $26,798 $30,455 $32,735 $38,530 $39,692 92%
(FDLP) ($6,430) ($6,294) ($6,640) ($6,726) ($6,554) ($6,105) ($5,569) ($6,135) ($8,209) ($15,158) ($39,692) 517%(FFELP) ($14,239) ($15,067) ($17,001) ($19,402) ($20,871) ($21,163) ($21,228) ($24,320) ($24,527) ($23,373) ($0) -100%
Unsubsidized Staord $16,537 $18,032 $20,574 $23,235 $25,145 $26,341 $26,085 $28,667 $40,065 $47,136 $46,088 179%(FDLP) ($4,670) ($4,836) ($5,215) ($5,257) ($5,254) ($5,181) ($4,767) ($5,156) ($9,240) ($18,052) ($46,088) 887%(FFELP) ($11,867) ($13,196) ($15,359) ($17,977) ($19,891) ($21,160) ($21,318) ($23,511) ($30,825) ($29,084) ($0) -100%
PLUS $4,657 $5,063 $5,888 $7,389 $8,475 $9,130 $10,950 $11,276 $11,908 $14,766 $17,113 267%(FDLP) ($1,492) ($1,554) ($1,847) ($2,148) ($2,303) ($2,367) ($2,400) ($2,415) ($3,445) ($6,348) ($17,113) 1047%(FFELP) ($3,165) ($3,509) ($4,041) ($5,241) ($6,173) ($6,764) ($8,551) ($8,861) ($8,463) ($8,418) ($0) -100%
Other Loans $146 $144 $152 $149 $162 $175 $172 $130 $118 $118 $131 -11%Total Federal Loans $43,453 $46,121 $52,023 $58,842 $63,108 $64,692 $65,738 $71,976 $85,779 $101,379 $103,995 139%
Federal Work-Study $1,185 $1,268 $1,329 $1,312 $1,245 $1,172 $1,117 $1,113 $1,103 $1,261 $1,171 -1%Education Tax Benefts $5,310 $5,690 $6,370 $6,860 $7,060 $7,140 $7,050 $6,990 $10,620 $14,830 $14,830 179%
Total Federal Aid $64,012 $69,781 $78,842 $87,724 $92,665 $93,326 $94,269 $102,280 $122,902 $159,918 $169,061 164%
State Grants $6,013 $6,415 $7,011 $7,103 $7,613 $7,627 $8,122 $8,371 $8,326 $9,036 $9,207 53%Institutional Grants $20,490 $20,810 $21,380 $23,480 $24,920 $26,600 $28,080 $29,430 $30,740 $34,580 $38,110 86%Private and Employer Grants $7,380 $7,870 $8,510 $9,130 $9,810 $10,520 $11,180 $12,090 $11,850 $10,680 $10,840 47%
Total Federal, State,Institutional, and Private Aid $97,895 $104,875 $115,742 $127,437 $135,008 $138,073 $141,651 $152,171 $173,817 $214,214 $227,219 132%
Nonederal Loans $6,430 $7,640 $10,000 $12,820 $16,700 $19,850 $22,600 $24,270 $11,760 $8,550 $7,870 22%(State- and Institution-Sponsored) ($1,380) ($1,500) ($1,530) ($1,680) ($1,740) ($2,000) ($2,250) ($2,190) ($1,560) ($1,670) ($1,870) 36%(Private Sector ) ($5,050) ($6,140) ($8,470) ($11,140) ($14,960) ($17,850) ($20,350) ($22,080) ($10,210) ($6,880) ($6,000) 19%
Total Funds Used to FinancePostsecondary Expenses $104,325 $112,515 $125,742 $140,257 $151,708 $157,923 $164,251 $176,441 $185,577 $222,764 $235,089 125%
NOTE: The latest available data or education tax benets are or calendar year 2009. Estimates or later years are based on these data. Components may notsum to totals because o rounding.
The ederal government provided 65% o all student aid in 2000-01, 68% in 2005-06, and 74% in 2010-
11. The ederal aid programs that have grown most rapidly in recent years are Pell Grants, grants to
veterans, and education tax credits. Borrowing through the unsubsidized Staord and PLUS Loan
programs also increased sharply over the decade.During the 2010-11 academic year,
$227.2 billion in nancial aid was distributedto undergraduate and graduate students inthe orm o grants rom all sources, FederalWork-Study, ederal loans, and ederaltax credits and deductions. In addition,students borrowed about $7.9 billion romprivate, state, and institutional sources tohelp nance their education.
Between 2005-06 and 2010-11, ederal grantaid to undergraduate and graduate studentscombined increased by 141% ater adjusting
or infation, and savings to taxpayersthrough ederal tax credits and deductionsor education increased by 108%.
Subsidies to parents and studentsrom ederal education tax creditsand deductions more than doubled,rom almost $7 billion in 2007-08 to anestimated $14.8 billion in 2009-10, as aresult o the introduction o the partiallyreundable American Opportunity TaxCredit.
The Federal Family Education LoanProgram (FFELP), through which banksand other private lenders receivedsubsidies to issue ederally guaranteed
education loans, was discontinued as o
June 30, 2010. The loan volume rom thisprogram moved to the Federal Direct LoanProgram (FDLP). Total Staord studentloans under the two programs combinedwere $85.7 billion (in 2010 dollars) in 2009-10 and $85.8 billion in 2010-11.
Private education loans, which are notpart o the student aid system and do notinvolve subsidies, grew rom $5.1 billion in2000-01 to $22.1 billion in 2007-08. Sincethat year, student loan volume rom banks,credit unions, and other private lenders
has declined to $6 billion.
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TRENDS IN STUDENT AID 2010 11TRENDS IN HIGHER EDUCATION SERIES TRENDS IN STUDENT AID 2011 11
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
Total Undergraduate andGraduate Student Aid by Type
The 17% o undergraduate aid in the orm o
institutional grants in 2010-11 constituted 32%
o all undergraduate grant aid. The ederal
government provided 51% o undergraduate
grant aid.
The 17% o graduate student aid in the orm o
institutional grants in 2010-11 constituted 60%
o all grant aid or graduate students. Colleges
and universities also provided ellowships and
assistantships to many graduate students.
The 9% o graduate student aid in the orm o
grants rom employers and other private sources
constituted 30% o all grants to graduate students.
ALSO IMPORTANT:
In all 2010, an estimated 14.3 million (87%) o the
16.3 million ull-time equivalent (FTE) postsecondary
students were undergraduates, and 2.1 million (13%)
were graduate students.
Graduate students include both those enrolled in
masters or doctoral programs and those in proessional
programs in elds such as law and medicine, who aremuch more dependent on student loans.
Undergraduate and graduate students are distributed
dierently across sectors. Thirty-nine percent o FTE
undergraduate enrollment is in the public our-year
sector, 31% is in public two-year colleges, 16% is in
private nonprot our-year institutions, and 12% is in the
or-prot sector, with a small share in other institutions.
Forty-eight percent o FTE graduate enrollment is in the
public our-year sector, 41% is in private nonprot our-
year institutions, and 10% is in the or-prot sector.
Undergraduate students are considered dependent,
with their aid eligibility a unction o their own and
their parents nancial circumstances, unless they areat least 24 years o age or are orphans or wards o
the court, homeless unaccompanied youth, married,
veterans, on active duty, or have legal dependents.
In contrast, all graduate students are independent or
purposes o ederal nancial aid, so their eligibility or
need-based aid depends only on their own income and
assets or most programs.
FIGURE 2A
Undergraduate Student Aid by Source and Type (in Billions), 2010-11
FIGURE 2B
Graduate Student Aid by Source and Type (in Billions), 2010-11
Private and Employer Grants ($6.6)
Institutional Grants ($29.7)
State Grants ($9.1)
Federal Education Tax Creditsand Deductions ($13.4)
Federal Loans ($70.0)
Federal Work-Study ($1.0)
Federal Pell Grants ($34.8)
Federal Grant Programsother than Pell ($13.1)
4%
$177.6Billion
17%
5%
8%
39%
1%
20%
7%
Undergraduate Aid
Private and Employer Grants ($4.2)
Institutional Grants ($8.4)
State Grants ($0.1)
Federal Education Tax Creditsand Deductions ($1.5)
Federal Loans ($34.0)
Federal Work-Study ($0.1)
Federal Grant Programs ($1.2)
$49.6Billion
Graduate Aid
9%
17%
3%
69%
2%
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12 TRENDS IN STUDENT AID 2011 TRENDS IN HIGHER EDUCATION SERIES
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
Types o Grants
Ater adjusting or infation, ederal grant aid was about two and a hal times greater in 2010-11 than
a decade earlier. Total grant aid increased rom $47.9 billion (in 2010 dollars) in 2000-01 to $107.2 billion
in 2010-11.
Because postsecondary enrollment
increased by 43% over the decade,
the 124% increase in total grant
aid generated a 58% increase in
infation-adjusted grant dollars per
FTE student.
Federal grant aid increased rom
29% o all grants to postsecondary
students in 2000-01 to 31% in
2005-06 and 46% in 2010-11.
Ater declining or two consecutive
years, grants to students rom
employers and private sources
increased slightly in infation-
adjusted dollars in 2010-11, to
an estimated $10.8 billion.
Total state grant aid to students
grew 2% in infation-adjusted dollars
in 2010-11, ollowing an increase o
9% in 2009-10. State grant aid grew
by 21% (in constant dollars) rom2005-06 to 2010-11, compared to
27% rom 2000-01 to 2005-06.
ALSO IMPORTANT:
Pell Grants constituted about 70% o ederal grant aid
over the entire 2000-01 to 2010-11 decade. Veterans and
military aid increased rom 20% to 25% o total ederal
grants over these years.
The large increase in ederal grant aid in 2009-10
resulted rom a combination o policy changes, growth
in enrollment, and economic conditions that increased
unemployment and reduced amily and student
nancial capacity.
FIGURE 3 Growth o Federal, Institutional, Private and Employer, and State Grant Dollars in Constant 2010 Dollars,
2000-01 to 2010-11
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100
$110
Grants(inBillions)in
Constant2010Dollars
Academic Year
10-1109-1008-0907-0806-0705-0604-0503-0402-0301-0200-01
$107.2
$96.7
$76.3
$72.1
$67.7$65.1$63.6
$60.4
$56.0$51.8
$47.9
46%44%
33%31%30%31%33%34%34%32%29%
36%
36%
40%
41%41%41%39%39%
38%40%
43%
10%
11%
16%
17%17%
16%15%15%
15%15%
15%
9%
9%
11%
12%
12%12%12%
12%
13%
12%13%
State Grants
Private and Employer Grants
Institutional Grants
Federal Grants
NOTE: Percentages may not sum to 100 because o rounding.
SOURCE: Table 1.
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TRENDS IN STUDENT AID 2010 13TRENDS IN HIGHER EDUCATION SERIES TRENDS IN STUDENT AID 2011 13
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
Types o Loans
In 2010-11, nonederal loans, which usually have less avorable repayment terms than ederal loans,
constituted only about 7% o education borrowing. From 2005-06 through 2007-08, nonederal loans
accounted or about a quarter o this borrowing.
FIGURE 4 Growth o Federal and Nonederal Loan Dollars in Constant 2010 Dollars, 2000-01 to 2010-11
NOTE: Nonederal loans include loans to students rom states and rom institutions, in addition to private loans issued by banks, credit unions, and Sallie Mae.Earlier editions o Trends in Student Aidhave not included estimates o institutional loan volume and have excluded some types o student loans made bystates. However, Figure 4 includes estimates or these loan sources or all years. Percentages may not sum to 100 because o rounding.
SOURCE: Table 1.
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100
$110
Loans(in
Billions)in
Constant2010Dollars
Academic Year
10-1109-1008-0907-0806-0705-0604-0503-0402-0301-0200-01
$111.9$109.9
$97.5$96.2
$88.3$84.5
$79.8
$71.7
$62.0
$53.8
$49.9
35%35%34%32%
30%32%34%36%38%40%41%
41%43%
41%
30%
30%31%32%32%
33%34%33%
9%
6%
8%
5%
8%
4%
8%
3%
10%
3%11%11%
10%
9%
9%
9%
7%8%
12%
25%
26%23%
21%
18%
16%
14%13%
Nonfederal Loans
Perkins and Other Federal Loans
Grad PLUS Loans
Parent PLUS Loans
Unsubsidized Stafford Loans
Subsidized Stafford Loans
1%1%
1%
2%
2%2%3%
3%
3%
3%3%
Over the course o the decade rom 2000-01 to 2010-11,
subsidized loans, on which the government pays the interest
while students are in school, declined rom 41% to 35%
o all education borrowing, and rom 56% to 46% o all
Staord Loans.
Some colleges and universities make loans to students and
parents to supplement their ederal loans. While no precise
measure o these loans is available, reports rom institutions
indicate that institutional loans have grown rom about $500
million in 2007-08 to about $720 million in 2010-11. For-prot
institutions have increased their lending to students over thistime period, while other institutions have reduced this activity.
Ater growing at an average annual rate o about 17% or three
years (rom $52.9 billion in 2010 dollars in 2006-07 to $85.7
billion in 2009-10), total Staord Loan volume grew by only an
estimated 0.1% in 2010-11, to $85.8 billion.
ALSO IMPORTANT:
The private student loan market has consolidated in recent years,
with a number o smaller lenders leaving the business and some
larger lenders selling their loans to others. The estimate o $6 billion
o private loans or 2010-11 combines inormation rom the Consumer
Bankers Association/MeasureOne with data rom credit unions.
Dependent undergraduate students can borrow up to $5,500 in
Staord Loans (including a maximum o $3,500 in subsidized loans)
in their rst year o study, and up to $6,500 (including up to $4,500 in
subsidized loans) in their second year. The limit or the third year and
beyond is $7,500 (including up to $5,500 in subsidized loans).
Graduate students can borrow up to $20,500 per year in Staord
Loans. The lietime maximum or graduate students is $138,500,
including their undergraduate borrowing. The total limit or subsidized
loans is $65,500. Beginning in 2012-13, all Staord Loans or graduate
students will be unsubsidized.
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14 TRENDS IN STUDENT AID 2011 TRENDS IN HIGHER EDUCATION SERIES
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Federal Aid Recipients
Federal education tax credits and deductions beneted about 12 million tax lers in 2009-10. The Pell
Grant program reached 9.1 million students in 2010-11, but other ederal grant and work programs
assisted many ewer students.
Pell Grants aided 9.1 million
students in 2010-11, compared
to 8.1 million in 2009-10 and 6.2
million in 2008-09. The number o
Pell Grant recipients was 2.3 times
as high in 2010-11 as in 2000-01.
In 2010-11, 9% o Pell Grant
recipients also received an Academic
Competitiveness Grant (ACG),
averaging $697 per recipient. About
2% o Pell Grant recipients receiveda SMART Grant, averaging $2,560
per recipient. As o the 2011-12
academic year, these grants are no
longer available.
FSEOG aided 1.3 million students in
2010-11, compared to 1.2 million in
2000-01. The average ederal grant
under this program decreased rom
$678 (in 2010 dollars) to $566 over
the decade.
Ater declining rom 713,000 in
2000-01 to 678,000 in 2008-09,
the number o Federal Work-Study
(FWS) recipients increased to
733,000 in 2009-10 as a result o
ederal stimulus unds provided
by the American Recovery
and Reinvestment Act o 2009
(ARRA). The number o programparticipants declined again to
713,000 in 2010-11.
Perkins Loans aided 493,000
students in 2010-11, down rom a
peak o 756,000 in 2003-04. The
average loan per recipient declined
rom $2,568 (in 2010 dollars) in
2003-04 to $1,969 in 2010-11.
ALSO IMPORTANT:
In addition to the $758 million o Federal Supplemental
Educational Opportunity Grant dollars reported here,
colleges and universities distributed about $200 million
to students in institutional matching unds under this
program. These dollars are included in the institutional
grant gures reported in Table 1.
In 2009-10, only 105,000 o the 19.5 million students
who completed the Free Application or Federal
Student Aid (FAFSA) submitted the paper application
rather than ling electronically. (The Federal Pell Grant
Program End-o-Year Report, 2009-10, Table 16)
NOTE: Both undergraduate and graduate students are eligible or tax benets, Perkins Loans, and Federal Work-Study (FWS). Federal Pell Grants, FederalSupplemental Educational Opportunity Grants (FSEOG), Academic Competitiveness Grants (ACG), and SMART Grants go to undergraduates only. Data on taxbenets are or 2009-10 (in 2010 dollars) and are based on data or tax year 2009. Data on post-9/11 veterans benets are based on benets paid rom Aug. 1,2009 through June 15, 2011.
SOURCES: Internal Revenue Service, Statistics o Income; Annual Publications, U.S. Department o Education, Oce o Postsecondary Education; unpublisheddata rom the Veterans Administration.
FIGURE 5 Number o Recipients o Federal Aid by Program (with Average Aid Received), 2010-11
FSEOG($566) FederalWork-Study($1,642)
FederalPell Grant($3,828)
ACG($697) Post-9/11 GI BillVeterans Benets($7,282)
SMART($2,560)Perkins Loan($1,969)Federal EducationTax Benets($1,236)
Federal Aid Programs (with Average Aid per Recipient)
NumberofRecipients
0
4,000,000
2,000,000
8,000,000
6,000,000
12,000,000
10,000,000
12million
9.1
million
1.3
million
713,0
00
609,0
00
150,0
00
493,0
00
786,0
00
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TRENDS IN STUDENT AID 2010 15TRENDS IN HIGHER EDUCATION SERIES TRENDS IN STUDENT AID 2011 15
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Federal Aid Recipients
In 2010-11, 34% o undergraduates took out ederal Staord Loans. Twenty-ve percent o students
or 74% o all Staord borrowers used both subsidized and unsubsidized loans. O the 30% o
students who took out subsidized Staord Loans, 83% also took out unsubsidized loans.
Subsidized loans are available only to students with documented
nancial need, and the government pays the interest on these
loans while the student is in school. Unsubsidized Staord
Loans are available to all undergraduate and graduate students.
The percentage o undergraduate students taking out ederal
Staord Loans during the academic year increased rom 22%
in 2000-01 to 28% in 2005-06, and to 34% in 2010-11.
On average, undergraduate students who took out Staord
Loans borrowed $5,628 (in 2010 dollars) in 2000-01, $5,538 in
2005-06, and $6,744 in 2010-11.
NOTE: Based on unduplicated undergraduate headcount enrollment, which counts each student only once even i they enroll in more than one institution andeach borrower only once, even i they take multiple loans. Enrollment or 2010-11 is estimated based on preliminary IPEDSnumbers. Percentages may not sumto 100 because o rounding.
SOURCES: NCES, Enrollment in Postsecondary Institutions and Financial Statisticsand Postsecondary Institutions and Price o Attendance in the United States,Annual Publications, U.S. Department o Education, Oce o Postsecondary Education; NSLDS; calculations by the authors.
FIGURE 6 Percentage o Undergraduate Students Borrowing Federal Staord Loans, 2000-01, 2005-06, and 2010-11
AcademicYear
(PercentageofParentswithPLUSLoans)
0% 20% 40% 60%
Percentage of Students
80% 100%
2000-01 (2.5% with PLUS)
2005-06 (3.6% with PLUS)
2010-11 (3.4% with PLUS)
Average Stafford inConstant 2010 Dollars$5,628
Average Stafford inConstant 2010 Dollars$5,538
Average Stafford inConstant 2010 Dollars$6,744
Both Subsidized and Unsubsidized LoansUnsubsidized OnlySubsidized OnlyNo Stafford Loans
78%
72%
66%
10%
11%
5%
4%
5%
4%
8%
13%
25%
ALSO IMPORTANT:
In 2010-11, the parents o about 3.4% o undergraduate students took
out PLUS Loans averaging $11,784.
Most student borrowers hold loans with a variety o interest rates.
Interest rates on unsubsidized Staord Loans are xed at 6.8%. The
interest rate on subsidized Staord Loans declined rom 6.8% to 6.0%
or loans issued in 2008-09, 5.6% in 2009-10, 4.5% in 2010-11, and
3.4% or loans issued in 2011-12. Without urther Congressional action,
the rate will return to 6.8% in 2012-13.
Subsidized and unsubsidized Staord Loans carry dierent repayment
protections. For example, under Income-Based Repayment, thegovernment will pay the interest or up to three years or borrowers
whose incomes are too low to cover interest payments on their
subsidized loans, but this is not the case or unsubsidized Staord Loans.
The Budget Control Act o 2011 eliminated the in-school interest
subsidy on Staord Loans or graduate students, eective July 1, 2012.
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16/32
16 TRENDS IN STUDENT AID 2011 TRENDS IN HIGHER EDUCATION SERIES
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
Federal Aid by Sector
Since its inception in 2009, the Post-9/11 GI Bill provided 36% o its benets to the 12% o FTE students
enrolled in or-prot institutions. Students in this sector received less than 10% o the ederal unds
provided through the Academic Competitiveness Grant, SMART Grant, and campus-based programs.
Students in or-prot institutions received 25% o all Pell Grant
dollars in 2009-10, compared to 13% a decade earlier (not
shown in Figure 7).
In 2009-10, the 12% o FTE students enrolled in or-prot
institutions received 25% o the subsidized and 28% o the
unsubsidized Staord Loans, compared to 10% and 8%,
respectively, or the 27% o all FTE students enrolled in public
two-year colleges.
The 31% o FTE undergraduate students in public two-year
colleges received 32% o Pell Grant unds in 2009-10, but
much lower percentages o other orms o ederal aid.
The 20% o FTE postsecondary students enrolled in private
nonprot colleges and universities received 46% o all
campus-based aid in 2009-10. Graduate students and parents
o undergraduate students in these institutions borrowed 53%
o all PLUS Loans.
FIGURE 7 Percentage Distribution o Federal Aid Funds by Sector, 2009-10
0% 20% 40% 60% 80% 100%
Percentage of Aid
For-ProtPrivate NonprotPublic Four-Year All PublicPublic Two-Year
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TRENDS IN STUDENT AID 2010 17TRENDS IN HIGHER EDUCATION SERIES TRENDS IN STUDENT AID 2011 17
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
Total Grants and Total Loans
From 2000-01 to 2005-06, loans increased rom 43% to 48% o the student aid rom all sources plus
nonederal loans that undergraduate students used to nance their education. By 2010-11, that share
had declined to 42%.
In 2010-11, grants provided 51% o
undergraduate unding. Federal education tax
credits and deductions, and a small amount o
Federal Work-Study unding, accounted or about
7% o total unds.
Rapid increases in ederal grant aid since 2008-09,
combined with very small increases in education
loans in both 2008-09 and 2010-11, explain the
increasing grant-to-loan ratio or undergraduate
students since 2007-08.
Over the ve years rom 2005-06 to 2010-11,
ederal education tax credits and deductions
or undergraduate students increased by an
estimated 117% in infation-adjusted dollars.
Grant aid rose 70%, compared to 31% or
ederal and nonederal loans combined.
Grant aid comprised 33% o the unds used by
graduate students in 2000-01, but has fuctuated
between 26% and 28% o the total rom 2003-04
through 2010-11.
FIGURE 8A
Grants and Loans as a Percentage o Funds rom Total Aid and Nonederal
Loans or Undergraduate Students, 1995-96 to 2010-11
FIGURE 8B
Grants and Loans as a Percentage o Funds rom Total Aid and Nonederal
Loans or Graduate Students, 1995-96 to 2010-11
Percentages in Figures 8A and 8B are shown as a
portion o the total amount o postsecondary unding
described in Table 1, including nonederal loans in
addition to nancial aid (grants, ederal loans, tax
credits and deductions, and Federal Work-Study).
In addition to the sources included here, students
rely on unds rom their amilies and rom their own
earnings and savings; they also borrow rom other
sources. Graduate students also receive ellowships
and research assistantships, which are considered
compensation.
SOURCE: Trends in Student Aid website(http://trends.collegeboard.org), Tables 4A and 4B.
0%
20%
40%
60%
80%
100%
Percentage
ofTotal
Funds
Academic Year
Undergraduate Students
10-1107-0805-0603-0401-0299-0097-9895-96
47%
43%46%
42%
51%50% 48%
51%
Grants
Loans
0%
20%
40%
60%
80%
100%
Percentage
ofTotalFunds
Academic Year
Graduate Students
10-1107-0805-0603-0401-0299-0097-9895-96
30%
33%
27% 27%
69%
63%
70% 69%Loans
Grants
ALSO IMPORTANT:
The relative stability o the ratio o grants to loans over
time indicates that loans have not replaced grants in
unding postsecondary education. Rather, grant aid
oten ails to increase rapidly enough to ll the growing
gap between the costs o attending college or graduate
school and the ability o students and amilies to pay
those costs.
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18 TRENDS IN STUDENT AID 2011 TRENDS IN HIGHER EDUCATION SERIES
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
FIGURE 9A
Distribution o Cumulative Debt Among 2009 Bachelors Degree Completers,
by Last Institutional Sector Attended
FIGURE 9B
Distribution o Cumulative Debt Among 2009 Four-Year College Students Not
Completing a Bachelors Degree, by Last Institutional Sector Attended
Student Debt
Among students beginning their studies in 2003-04, about 19% o bachelors degree completers and
about 13% o students who last attended a our-year institution but did not complete a bachelors degree
accumulated more than $28,000 in student debt.
Bachelors degree completers are more likely
than those who did not graduate to have
accumulated large amounts o student debt, but
overall they are also somewhat more likely to
have no debt at all.
Among dependent students beginning their
postsecondary studies in 2003-04 who last
attended a or-prot our-year institution, 15%
had earned bachelors degrees by 2009. Two-
thirds o these graduates had at least $28,000
in education debt. About 15% o dependent and
16% o independent students who last attended
a or-prot our-year institution, but did not earn a
bachelors degree, borrowed more than $28,000.
Among dependent students who last attended
a public our-year institution, 64% had earned
bachelors degrees by 2009. Fourteen percent
o these graduates had at least $28,000
in education debt. Over a quarter o the
independent public our-year graduates had this
much debt.
About 10% o dependent and 15% o
independent students who last attended a public
our-year institution, but did not earn a bachelors
degree, borrowed more than $28,000.
ALSO IMPORTANT:
Among bachelors degree recipients, 15% o dependent
students and 39% o independent students began their
studies in 2003-04 at a two-year (or less) institution.
Among students who last attended a our-year
institution but did not complete a bachelors degree
by 2008-09, 35% o dependent students and 41% o
independent students began their studies in 2003-04 at
a two-year (or less) institution.
Percentages o 2003-04 Beginning Postsecondary
Students Who Last Attended a Four-Year Institution
Receiving Bachelors Degrees by 2009
Dependent Independent
BachelorsDegree
NoBachelors
DegreeBachelors
Degree
NoBachelors
Degree
Total 63% 37% 22% 78%
Public Four-Year 64% 36% 23% 77%
Private Nonproft Four-Year 71% 29% 31% 69%
For-Proft Four-Year 15% 85% 13% 87%
NOTE: Beginning Postsecondary Students Longitudinal Study(BPS) reports on a nationally
representative sample o students who began their studies in 2003-04. Figures 9A and 9B are
based on students whose last institution attended was a our-year college or university. Debtcategories are based on quartiles o total debt or the 66% o students meeting this criterion
who took out student loans. Debt amounts include both ederal and nonederal student loans.
The All category includes both dependent and independent students. For independentbachelors degree recipients, the sample size in the or-prot our-year sector is too small to
obtain accurate estimates, and thereore was omitted rom Figure 9A. In the or-prot sector,many our-year institutions enroll students in shorter-term certicate and associate degree
programs. This is less common in public and private nonprot our-year institutions.
SOURCES: Beginning Postsecondary Students Longitudinal Study(BPS), 2009; calculations by
the authors.
DependencyStatusandSector
withNumberofStud
ents(inThousands)
Percentage
0% 20% 40% 60% 80% 100%
Total Four-Year (1,140)
Total Four-Year (58)
Private Nonprot Four-Year (21)
Public Four-Year (27)
Total Four-Year (1,082)
For-Prot Four-Year (15)
Private Nonprot Four-Year (347)
Public Four-Year (720)
All
Independent
Dependent
Fourth Quartile(>$27,978)
Third Quartile($17,289$27,978)
Second Quartile($9,883$17,288)
First Quartile($1$9,882)
$0
36%
25%
26%
32%
37%
16%
32%
40%
15%
10%
13%
12%
16%
6%
16%
16%
11%
8%5%
11%
11%
2%
8%
13%
18%
13%
13%
18%
18%
11%
20%
17%
19%
44%
44%
27%
18%
65%
25%
14%
DependencyStatusandSector
w
ithNumberofStudents(inThousands)
Percentage
0% 20% 40% 60% 80% 100%
All
Independent
Dependent
Total Four-Year (830)
Total Four-Year (207)
For-Prot Four-Year (71)
Private Nonprot Four-Year (46)
Public Four-Year (90)
Total Four-Year (623)
For-Prot Four-Year (82)
Private Nonprot Four-Year (141)
Public Four-Year (400)
Fourth Quartile(>$27,978)
Third Quartile($17,289$27,978)
Second Quartile($9,883$17,288)
First Quartile($1$9,882)
$0
31%
15%
37%
36%
32%
13%
28%
37%
18%
24%
13%
15%
18%
29%
17%
17%
24%
28%
20%
22%
24%
27%
22%
24%
14%
17%
16%
11%
14%
16%
16%
13%
13%
29% 18%24% 14% 15%
16%
14%
15%
12%
15%
17%
10%
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19/32
TRENDS IN STUDENT AID 2010 19TRENDS IN HIGHER EDUCATION SERIES TRENDS IN STUDENT AID 2011 19
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
Student Debt
Spread across all public our-year college
graduates who earned degrees rom the
institution at which they began their studies,
average debt per bachelors degree recipient was
$12,300 in 2009-10.
About 65% o students who earned bachelors
degrees in 2009-10 rom the private nonprot
our-year colleges at which they began their
studies graduated with debt. Average debt per
borrower was $28,100, up rom $22,600 (in 2010
dollars), a decade earlier.
Spread across all private nonprot our-year
college graduates who earned degrees rom
the institution at which they began their studies,
average debt per bachelors degree recipient was
$18,300 in 2009-10.
From 1999-2000 to 2009-10, average debt
per borrower among public college bachelors
degree recipients increased at an average annual
rate o 1.1% beyond infation. The percentage
o nontranser graduates with debt increased
rom 54% to 56%. Average debt grew by 1.4%per year over the most recent ve years o the
decade.
From 1999-2000 to 2009-10, average debt per
borrower among private nonprot bachelors
degree recipients increased at an average annual
rate o 2.2% beyond infation. The percentage
o nontranser graduates with debt increased
rom 63% to 65%. Average debt grew by 1.5%
per year over the most recent ve years o the
decade.
ALSO IMPORTANT:
As Figures 9A and 9B reveal, students who earn their
bachelors degrees at or-prot institutions are more
likely to borrow than those who attend public and
private nonprot colleges, and those who borrow
accumulate higher average levels o debt.
FIGURE 10A
Average Total Debt Levels o Bachelors Degree Recipients, Public Four-Year
Colleges and Universities, in Constant 2010 Dollars, 1999-2000 to 2009-10
FIGURE 10B
Average Total Debt Levels o Bachelors Degree Recipients, Private Nonprot Four-
Year Colleges and Universities, in Constant 2010 Dollars, 1999-2000 to 2009-10
Only students who began their studies at the institution rom which theygraduated are included in the data reported here. The blue bars represent theaverage debt levels o bachelors degree recipients who relied on student loans.The orange bars represent average debt per degree recipient, including thosewho graduated without student debt. The percentages along the base o the axisrepresent the percentage o degree recipients who borrowed.
NOTE: Debt gures include both ederal loans and loans rom nonederal sources that havebeen reported to the institutions. Transer students are excluded. Debt gures are basedon institutional reporting to the College Board and are best approximations. Estimates or2010-11 incorporate both the responses or that year and the change rom 2009-10 or schoolsreporting or both years. Exact dollar amounts should be interpreted with caution. The dataare not adequate to allow comparable calculations or or-prot institutions.
SOURCES: Annual Survey o Colleges, 2001 to 2011; calculations by the authors.
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
AverageCumulative
DebtinConstant2010Dollars
Academic Year(Percentage of Students Who Borrowed)
Per Bachelors Degree RecipientPer Borrower
09-10(56%)
08-09(55%)
07-08(55%)
06-07(55%)
05-06(55%)
04-05(55%)
03-04(54%)
02-03(53%)
01-02(52%)
00-01(52%)
99-00(54%)
$19,8
00
$10,7
00
$19,4
00
$10,1
00
$19,5
00
$10,1
00
$19,8
00
$10,5
00
$20,0
00
$10,8
00
$20,5
00
$11,2
00
$20,8
00
$11,5
00
$20,5
00
$11,3
00
$20,5
00
$11,3
00
$20,1
00
$11,1
00
$22,0
00
$12,3
00
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
AverageCumulativeDebtinConstant2010Dollars
Academic Year(Percentage of Students Who Borrowed)
Per Bachelors Degree RecipientPer Borrower
09-10(65%)
08-09(65%)
07-08(65%)
06-07(66%)
05-06(65%)
04-05(64%)
03-04(64%)
02-03(63%)
01-02(64%)
00-01(63%)
99-00(63%)
$22,6
00
$14,2
00
$22,6
00
$14,1
00
$23,0
00
$14,6
00
$24,2
00
$15,3
00
$24,6
00
$15,7
00
$26,1
00
$16,8
00
$27,2
00
$17,7
00
$27,3
00
$18,1
00
$26,5
00
$17,3
00
$26,2
00
$17,1
00
$28,1
00
$18,3
00
About 56% o students who earned bachelors degrees in 2009-10 rom the public our-year colleges at
which they began their studies graduated with debt. Average debt per borrower was $22,000, up rom
$19,800 (in 2010 dollars) a decade earlier.
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20 TRENDS IN STUDENT AID 2011 TRENDS IN HIGHER EDUCATION SERIES
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
Total Aid per Full-Time Equivalent Student
NOTE: Loans reported here include only ederal loans to students and parents. Grants rom allsources are included.
SOURCE: Trends in Student Aid website (http://trends.collegeboard.org), Tables 3A and 3B.
In 2010-11, undergraduate students
received an average o $12,455 in aid
per ull-time equivalent (FTE) student,
including $6,539 in grants rom allsources, $4,907 in ederal loans, and
$1,009 in a combination o tax credits
and deductions and Federal Work-
Study (FWS).
Total grant aid per ull-time equivalent
undergraduate student increased at an average
rate o 3.5% per year in infation-adjusted dollars
rom 1995-96 to 2000-01, 3.4% per year rom
2000-01 to 2005-06, and a much more rapid rate
o 6.8% per year rom 2005-06 to 2010-11.
Federal loans per FTE undergraduate student
have grown at an increasing rate, rising at
an average rate o 0.2% per year in infation-
adjusted dollars rom 1995-96 to 2000-01, 4.6%
per year rom 2000-01 to 2005-06, and 5.5% per
year rom 2005-06 to 2010-11.
FTE graduate students received an average
o $23,995 in aid, including $6,750 in grant
aid, $16,423 in ederal loans, and $782 in a
combination o tax credits and deductions and
Federal Work-Study.
In 2010-11, graduate students received about
$200 more in grant aid per student than
undergraduates and borrowed about $11,500
more in ederal loans.
In 2010-11, graduate students received 19%
more in grant aid per FTE student (ater adjusting
or infation) than they had a decade earlier. They
borrowed 75% more per student in ederal loans
in 2010-11 than in 2000-01.
ALSO IMPORTANT:
Overall, postsecondary students received an average o
$443 more (in 2010 dollars) per student in benets rom
ederal tax credits and deductions in 2010-11 than in
2000-01. They earned $32 less per student rom Federal
Work-Study jobs.
FIGURE 11A
Average Aid per Full-Time Equivalent (FTE) Undergraduate Student in Constant
2010 Dollars, 1995-96 to 2010-11
FIGURE 11B
Average Aid per Full-Time Equivalent (FTE) Graduate Student in Constant 2010
Dollars, 1995-96 to 2010-11
$0
$4,000
$8,000
$12,000
$16,000
$18,000
$2,000
$6,000
$10,000
$14,000
AverageAidinConstant2010Dollars
Academic Year
10-1107-0805-0603-0401-0299-0097-9895-96
Undergraduate Students
$2,967 $2,999$3,759
$4,907$3,346 $3,979
$4,706
$6,539Average Grant Aid per FTE
Average Federal Loans per FTE
$0
$4,000
$8,000
$12,000
$16,000
$18,000
$2,000
$6,000
$10,000
$14,000
A
verageAidinConstant2010Dollars
Academic Year
10-1107-0805-0603-0401-0299-0097-9895-96
Graduate Students
$3,984
$5,695 $5,837
$6,750
$8,425$9,362
$11,962
$16,423
Average Grant Aid per FTE
Average Federal Loans per FTE
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21/32
TRENDS IN HIGHER EDUCATION SERIES TRENDS IN STUDENT AID 2011 21
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
Education Tax Credits and Tuition Deductions
The American Opportunity Tax
Credit (AOTC), introduced in 2009,
increased the total tax savings or
college students and their parentsclaiming education credits and tuition
deductions rom $6.6 billion in 2008 to
$14.7 billion in 2009.
Education tax credits and deductions are tax
expenditures. They reduce ederal income tax
liabilities and ederal tax revenues. Their
impact on the ederal budget is the same as the
impact o direct expenditures.
The maximum income level or which joint lers
were eligible or the AOTC was $180,000 in
2009 higher than the $160,000 limit or lers
claiming the tuition deduction and the $120,000
limit or those claiming the preexisting tax credits.
Because o the increase in the income limits or
education tax credits, the percentage o total tax
savings rom education credits and deductions
going to lers with incomes o $100,000 or higher
increased rom 18% in 2008 to 26% in 2009.
Unlike the Hope and Lietime Learning tax credits
in existence since 1998, the AOTC is partially
reundable. Taxpayers receive a credit o up to
$2,500 or tuition, ees, and course materials.
Filers who do not owe taxes can receive a reund
o 40% o their credit (up to a maximum o
$1,000).
Because o the reundability o the AOTC, the
percentage o total tax savings rom education
credits and deductions going to lers with an AGI
below $25,000 increased rom 5% in 2008 to
17% in 2009.
ALSO IMPORTANT:
The ederal government allows a tax deduction or
interest paid on student loans. In 2009, 7.2 milliontaxpayers with taxable returns deducted $6.4 billion in
student loan interest, generating over $1 billion in savings.
Other signicant subsidies to students through the
tax code include the personal exemption allowed
or students ages 19 and over, which saved parents
about $3 billion in 2009, and the excludability o tuition
assistance rom employers, which saved students about
$680 million. Taxpayers saved about $1.5 billion in taxes
on the earnings rom earmarked savings or education.
(Analytical Perspectives, Budget o the U.S. Government,
FY 2012, Table 17-1, http://www.whitehouse.gov/sites/
deault/les/omb/budget/y2012/assets/spec.pd)
FIGURE 12A
Distribution o Total Tax Savings rom Education Tax Credits and Tuition
Deductions by Adjusted Gross Income (AGI), 2008 and 2009 (and Average Tax
Savings per Recipient)
FIGURE 12B
Total Education Tax Credits and Tuition Deductions in Constant 2009 Dollars,
1998 to 2009 (and Average Tax Savings per Recipient)
0% 20% 40% 60% 80% 100%
Percentage of Savings 2009($1,221)
Percentage of Savings 2008($833)
28%($888)
23%($885)
26%($1,127)
18%($646)
5%
20%($866)
18%($1,164)
18%($1,572)
AGI Level
26%($1,773)
17%($1,028)
($416)
$100,000 to$180,000
$75,000 to$99,999
$50,000 to$74,999
$25,000 to$49,999
Less than$25,000
$0 $2 $4 $8
Total Education Tax Savings (in Billions) in Constant 2009 Dollars
Tax
Year
$12$6 $10 $14 $16
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009 ($1,329) $14.7
($401)
($1,006)
($994)
($477)
($488)
$6.6
$6.8
($1,010) ($513) $7.0
($985) ($535) $6.8
($981) ($530) $6.9
($966) ($459) $6.5
($944) ($474) $6.0
($869) $5.2
($890) $5.2
($972) $5.3
($973) $3.9
Total DeductionsTotal Credits
NOTE: Reundable tax credits claimed on all returns are included. For nonreundable creditsand or deductions, only amounts claimed on taxable income tax returns are included. Thevalue o tax deductions is estimated based on applicable marginal tax rates. Available data donot allow separation o independent students rom parents o dependent students claimingtax credits and deductions. The tax deduction was rst implemented or the 2002 tax year.Percentages may not sum to 100 because o rounding.
SOURCES: Internal Revenue Service, Statistics o Income, http://www.irs.gov/taxstats/indtaxstats/article/0,,id=96981,00.html,Tables 1.3, 1.4, 3.3 (19982009); calculations by the authors.
http://trends.collegeboard.org/http://www.whitehouse.gov/sites/default/files/omb/budget/fy2012/assets/spec.pdfhttp://www.whitehouse.gov/sites/default/files/omb/budget/fy2012/assets/spec.pdfhttp://www.irs.gov/taxstats/indtaxstats/article/0,,id=96981,00.htmlhttp://www.irs.gov/taxstats/indtaxstats/article/0,,id=96981,00.htmlhttp://www.whitehouse.gov/sites/default/files/omb/budget/fy2012/assets/spec.pdfhttp://www.irs.gov/taxstats/indtaxstats/article/0,,id=96981,00.htmlhttp://www.irs.gov/taxstats/indtaxstats/article/0,,id=96981,00.htmlhttp://www.whitehouse.gov/sites/default/files/omb/budget/fy2012/assets/spec.pdfhttp://trends.collegeboard.org/8/3/2019 Trends in Student Aid 2011, College Board
22/32
22 TRENDS IN STUDENT AID 2011 TRENDS IN HIGHER EDUCATION SERIES
For detailed background data and additional inormation, please visit http://trends.collegeboard.org.
Pell Grants
Total Pell Grant expenditures increased
by 16% between 2009-10 and 2010-11,
leading expenditures in this program to
almost double over two years, rom$18.1 billion (in 2010 dollars) in 2008-09
to $34.8 in 2010-11.
The number o Pell Grant recipients increased
rom 3.9 million in 2000-01 to 5.2 million in
2005-06 and 6.2 million in 2008-09. In 2009-10,
8.1 million students received Pell Grants and the
number
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