4 Out of 5 College Students Face Financial Troubles Due to Coronavirus Pandemic
The coronavirus outbreak is impacting the economy, and college students aren’t spared from the effects. While many schools have sent students to live off campus or back home to their families, this doesn’t seem to have eased expenses for everyone. Likewise, job losses are adding to many students’ hardships.
LendingTree surveyed more than 1,000 college and university students to learn about how the COVID-19 pandemic has impacted their finances, academics and post-graduation career plans. Here’s what the data showed.
Key findings
- More than 4 out of 5 (81%) of college students surveyed said they are facing financial difficulties due to the coronavirus crisis, with more than a quarter having trouble paying bills or feeding themselves. (Read more)
- Student loan borrowers are facing a higher level of financial difficulties than their peers. (Read more)
- Black and Hispanic students report higher levels of food and housing insecurity due to the global health pandemic than their white peers. (Read more)
- About 1 in 4 students lost their job due to the COVID-19 outbreak. (Read more)
- More than one-third of students are taking on debt to cope with losses caused by the pandemic. (Read more)
- Students are anxious about academics and their chances of finding a job after graduation. (Read more)
- Most students want at least partial student loan forgiveness from the government. (Read more)
More than 4 out of 5 students facing financial challenges
Amid the economic collapse from the coronavirus outbreak, nearly 47% of college students said they’ve experienced a loss of income, and about 26% reported either food insecurity or trouble paying bills. Of those having trouble paying bills, most (71%) were especially concerned about rent.
Black and Hispanic students reported a much higher level of food and housing insecurity due to the COVID-19 pandemic than their white peers. Specifically, 33% of black students were having trouble covering food costs, and 22% struggled with housing expenses. In those same categories, the figures were 36% and 18% respectively, for Hispanic students. By comparison, 21% of white students reported suffering from food insecurity, and 14% faced housing issues.
Student loan borrowers were also facing a heightened level of financial stress than their debt-free peers, with 31% worried about paying bills compared to 19% among the debt-free group. And while nearly 43% of all college students are worried for their parents’ financial situation, that number rose to nearly 47% among student loan borrowers.
Students still face high costs despite taking classes online
With college campuses closing across the country, many students have left school grounds to continue their studies remotely.
According to our survey, about 68% of college students have gone back home, while an additional 22% are living off campus. About 59% of students will be taking classes online for the rest of the semester, while 36% said their online learning is still considered a temporary measure at this point.
But despite the transition to off-campus learning, almost half of students (49%) say their college expenses haven’t been reduced in any way.
On the other hand, about 13% of those surveyed were able to return some student loan money because they no longer needed to pay for housing or a meal plan. And nearly 1 in 4 said they expect to receive a refund from their school for housing and meal costs.
Over one-third of students taking on debt to deal with the crisis
With many students having to leave campus due to the COVID-19 outbreak, it’s not surprising that 1 in 4 has lost their job. An additional 24% were able to keep their jobs but said their hours were cut.
To cope with these losses, more than one-third of students (36%) are taking on debt. Over 17% reported amassing credit card debt, and 16% said they had to borrow additional student loans.
Student loan borrowers (47%) were more likely to take on additional debt than those without student loans (19%). And students who identified as either black or Hispanic were much more likely to be taking on debt (48%) than white students (29%).
Majority of students want student loan forgiveness from the government
In response to the COVID-19 crisis, the government passed the “Coronavirus Aid, Relief, and Economic Security Act” (CARES Act). Among the education provisions, the legislation has paused interest charges on federal student loans for six months and offered to halt payments for that time period for whomever needs it.
But the majority of students in this survey (77%) felt the government should go farther by automatically forgiving a portion of all borrowers’ student loans to deal with the fallout from the coronavirus outbreak. This number was higher among women than men (81% versus 74%) and highest among student loan borrowers (84%).
Students are anxious about academics and job prospects
Along with their financial anxieties, students are also stressed about academics and their job prospects following graduation.
More than half of those surveyed said they feared their learning would be hindered without in-person classes, and 30% were worried their grades would suffer. At the same time, nearly 14% were concerned they didn’t have access to the technology they needed to get their work done, and almost 12% said they were stressed they wouldn’t get to complete an internship.
Almost half (49%) of graduating seniors think the pandemic will impact their chances of finding a job after graduation. And nearly 51% of all students said they felt less prepared to enter the workforce because of the coronavirus pandemic.
In fact, 72% of graduating seniors said the COVID-19 crisis had already impacted their post-graduation plans. Among students in their final year of college, 26% said they had decided to move back home due to the pandemic, while 19% had decided to pursue a different career path, and 28% said their plans had changed in some other way.
Finding relief during the coronavirus pandemic
Fortunately, anyone with federal student loans can find some relief, thanks to the CARES Act, which — as mentioned above — offers six months of 0% interest and allows you to pause to your repayments interest-free.
Borrowers with private student loans, meanwhile, should contact their loan servicer to find out about options if they need to pause payments.
Methodology
LendingTree commissioned Qualtrics to conduct an online survey of 1,052 full-time college students. The survey was fielded March 25-26, 2020.