Student debt: Where you attend college matters (Ivy League may be better deal than state college)

[No Elephants]

By Kathleen Kingsbury

BOSTON | Fri May 11, 2012 10:01am EDT

(Reuters) - <snip>

Where you attend college can significantly impact how much you owe when you leave school. Thanks to generous financial aid policies and large endowments, students may find that an Ivy League degree, for example, often requires less borrowing than a degree from many much less expensive state schools.

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These schools, among the most elite and expensive in the country, also have instituted in the last several years some of the most generous financial aid policies. On average, 53 percent of students at the surveyed schools received financial aid, and at least half of students at most of the institutions graduated debt-free. Yet University of Michigan graduates owed, on average, more than $27,000, compared with an average for Princeton University graduate of only $5,000.

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California alone — which educates about 10 percent of all full-time U.S. college students — increased tuition and fees at state schools by 21 percent in 2011 at its four-year institutions and by 37 percent at two-year colleges.

With the weak job market, the prospects for paying back loans are challenging for recent grads. One statistic grabbing headlines is that total outstanding student loan debt in the U.S. now tops $1 trillion, exceeding even credit card debt.

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Indeed, one take away from the Reuters' survey - some debt is nearly unavoidable in higher education today. Despite the generosity of elite schools, today's student debt burden will undoubtedly impact graduates' — and perhaps the nation's — future opportunities. "We're talking about the generation who will hopefully steady our economy," says Ronald Johnson, financial aid director at UCLA, where students graduated with average debt of $18,203 in 2011. "And we've tied one hand behind their back as we send them off into the world.

(Editing by Lauren Young, Jilian Mincer, Leslie Adler; To read more about student loans follow us @ReutersMoney or here)

Much more at http://www.reuters.com/article/2012/05/11/us-personalfinance-studentdebt-idUSBRE84A0LA20120511