As concerns grow about the rising cost of a college degree and mounting student debt, Lumina Foundation has released an Affordability Benchmark for Higher Education, which seeks to provide a clear and common understanding of affordability. The report recommends a “Rule of 10” benchmark that caps contributions as follows:
- Families save 10 percent of their discretionary income;
- Saving over 10 years; and
- Students work 10 hours per week during college.
Using this rule, family and student contributions vary according to their circumstances. Families living below 200 percent of the poverty level would not be expected to contribute savings. Lumina hopes the benchmark will contribute to the ongoing debate about college costs, student aid and debt as well as the escalating debate around free college attendance or debt-free college attendance. The report offers background on how Lumina developed the benchmark, examples of how the benchmark applies and plays out for families with different levels of income, and some issues for future consideration, including how the benchmark might impact student financial aid.