Sallie Mae released today How America Pays for College 2010: A National Study by Sallie Mae and Gallup:

The report is the third annual Sallie Mae national study conducted by Gallup that examines how families of undergraduate students aged 18 to 24 finance the expenses associated with a higher education. To capture a complete picture of how families meet the costs of college, Sallie Mae and Gallup designed this study to gather data directly from families of the college-going population on their attitudes, aptitudes and actual experiences regarding paying for college. In spring 2010, Gallup surveyed 801 collegegoing students and 823 parents of such students. This year’s survey provides an improved sample of Hispanic and African-American families to help ascertain whether race and ethnicity influence how families pay for college.

The major influence through the entire report is the increasing cost of attending college. The surveyed families report that their costs of attendance have increased 17% over last year and 28% above two years ago. Families across all income levels faced increased costs except, notably, the lowest-income families, earning less than $35,000 a year. The cost of attendance for those families has stayed relatively flat, perhaps reflecting a trend in this income group to attend two-year public colleges.

Families have met the additional costs by increasing their use of nearly all sources of funding: income, borrowing, and grants and scholarships. As in prior years, Gallup used the data on funding sources to develop a composite picture of how the average American family pays for college. This year’s study shows that while the cost of college went up, the way families paid for it did not change.

   

On average, parents still pay the highest share of college costs, including 37% from parent income and savings and 10% from parent borrowing. Grants and scholarships remain the second most important source of funding for college, making up an average of 23% of college costs. Students borrowed another 14% of the bill, and used their own income and savings to cover an additional 9%. Friends and relatives paid an average of 7% of costs. The pie chart showing the composite of how the average family pays is virtually unchanged from last year. But, with higher costs to meet, the year-to-year comparison shows an upward shift in the average amount families spent in all categories.

 
Overall, the percentage of families who used scholarships or grants increased from 51% in last year’s study to 55% this year, and the percentage who borrowed to pay for college rose from 42% to 46%.