Why are so many veterans taking out student loans when GI bill benefits cover full tuition and fees at public universities, and at least partial tuition and fees at private universities?
In new survey results released today, The Pew Charitable Trusts found that most veterans who take out student loans do so to pay living expenses. Even though bill benefits also include stipends to cover books, supplies, and housing allowances, veteran borrowers face unique challenges and often have to juggle additional financial obligations, such as child care.
Nearly 6 in 10 U.S. military veterans who have taken out student loans cite living expenses, such as housing and child care, as their main reason for borrowing, according to a first-of-its-kind, nationally representative survey of veterans who have taken out student loans.
The survey—conducted for The Pew Charitable Trusts among veterans who served after Sept. 11, 2001—helps shed light on a key mystery: why so many are taking on student loan debt despite having access to robust Post-9/11 GI Bill benefits.
A separate Pew analysis done earlier this year using U.S. Department of Education data found that just over a quarter of veterans in undergraduate programs took out loans, with a median amount of $8,000 in the 2015-16 academic year.
The questions in the survey were crafted to give a better sense of how veterans use the borrowed money, including a request to rank the expenses covered with student loan dollars. Among the key findings:
- 58% of those who took out student loans said they borrowed primarily to cover living expenses. The most commonly cited were housing costs (21%) and day-to-day expenses, such as groceries and child care (17%). (See Figure 1 for more detail.)
- 42% cited educational expenses as the primary cost they borrowed to cover. Most chose tuition and fees (36%), while a small proportion selected books and supplies (6%).
Read the complete article on Pewtrusts.org