A college education is not only increasingly a necessity to secure a good job, but also often the first step to acquiring assets and creating greater opportunities. Each additional year of educational attainment yields increased earnings and makes the ownership of assets such as investments, retirement savings, a home, and other sources of wealth more likely. With the reauthorization of the Higher Education Act underway in 2004, an opportunity now exists to make a college education available to every qualified person.
While the educational attainment rates in the United States continue to rise across all race and income groups, persistent gaps remain between races and people of difference socio-economic backgrounds. Family wealth and income, as well as parental educational attainment, continue to be the best predictors of which students will enroll in college, regardless of a student’s academic preparation.
Federal and state governments spend billions of dollars on financial aid each year to help students gain access to college. However, this aid has recently undergone a shift from its original intent of helping students who could not otherwise attend college to a greater emphasis on loans, merit awards, and tax credits which low-income families often cannot take advantage of because of their limited income tax liabilities.
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