Pricey College 'Extras' Undercut Student Efforts to Graduate

• By Dian Schaffhauser
• 10/30/17

More women than men drop out of college for financial reasons — by a difference of 11 percentage points (52 percent versus 41 percent). Among Hispanic students of both genders, 61 percent who have attended college did so for less than two years; and of those who didn't attend all the way to graduation, almost 60 percent blamed financial limitations. For African-American students, 65 percent attended college for two years or less, and of those who didn't, 36 percent said their decision was owing to finances.

Those are some of the results pulled from a survey of 1,092 men and women aged 18 to 25 in the United States, some of whom are just beginning the college process and others who have graduated within the last few years. The project was undertaken by the 1,000 Dreams Fund, a non-profit with the goal of sending 1,000 young women to college through scholarship building; the organization also helps cover the costs of college visits for girls. The survey was conducted online byToluna Quicksurveys and was underwritten by financial services firm Charles Schwab.

The survey found that female and first-generation students, in particular, have struggles with the higher education process. It begins in high school when they visit prospective universities (if they can afford it, the researchers noted) and continues through all aspects of the college experience. A slight majority of female respondents (51 percent) said they felt "financially unprepared" for college compared to 39 percent of male respondents.

The Gender Gap in College Financial Readiness

Women feel less financially prepared than men for college and drop out due to financial reasons more frequently. Source: 1,000 Dreams Fund's "Hidden Costs of College"

Once they're in college, having less money prevents young women from participating in extracurricular opportunities, such as unpaid internships or study abroad, which, according to a report sharing the results, "makes them less marketable once they enter the workforce." Among all first-generation students, while 77 percent said those extracurriculars were "very important" to post-graduation goals, just 15 percent said they were able to participate.

Among all respondents, three in 10 were surprised about "hidden costs" of college, such as textbooks (63 percent saying those were much more than expected), housing (55 percent), food (46 percent), school exams and fees (45 percent) and moving expenses (41 percent).

"It's critical that all young people feel financially prepared for some of the unexpected costs of college. Everyone needs to know how to create a budget, live within their means and plan for the future," said Carrie Schwab-Pomerantz, president of Charles Schwab Foundation, in a prepared statement. "Currently only 17 states require a personal finance course in high school. We need to get our children prepared for the financial reality of life away from home."

"We all know that college is expensive, but it's the hidden costs and expenses for extracurricular activities that can really hobble students and their future careers," added Christie Garton, founder and CEO of 1,000 Dream Funds. "Getting to and finishing college is a challenge, but getting the most out of college means making connections through extra activities that really help jumpstart your future career."

The report is available on the 1,000 Dreams Fund website with registration. Also, a social media challenge is awarding $2,000 grants toward college expenses. Participants need to post a selfie and tell how they'd spend the money. More details on that are available here.