College tuition costs continue to rise, and now nearly half of families are borrowing money to pay for college, according to Sallie Mae's new report. Tuition continues to increase faster than any other household expense, partly because colleges are receiving less financial support from state and local governments.
With a growing number of colleges and universities costing more than $100,000 a year, many students are finding higher education increasingly out of reach. Only 12% of surveyed Americans say four-year colleges are affordable.
Families are increasingly relying on federal and private aid to help cover the costs. Nearly half of families borrowed money for college in the 2025-26 academic year, and 68% of those respondents said borrowing was always part of their plan.
In most cases, parent income and savings cover less than half of college costs. Student loans make up most of the rest.
How families finance college
In 2026, parents who saved for college reported having set aside $37,897, a significant decline from the $51,310 they reported in 2025. As a result, just 16% of families who saved for college said they felt prepared to cover the total cost of a degree through savings alone.
The findings come as families face new limits on federal student loans.
How we got here
Except for buying a home, a college education is now the largest expense an individual is likely to have in a lifetime. In recent decades, deep cuts in state funding have contributed to sharp tuition increases:
