The United States continues to lag behind other major industrialized nations in the percentage of the population with a college degree, according to a recent series of studies released by the Making Opportunity Affordable project.

Although currently ranked tenth among industrialized countries in the percentage of 25–34-year-olds already holding an associate’s degree or higher, the U.S. ranks near the bottom in the percentage of entering students that are completing their degree program. In fact, the U.S. now stands as one of the only countries where older adults are more educated than younger adults.

A 16-Million College Degree Gap

At current college graduation rates, by 2025, the U.S. will be 16 million college degrees short of the 64 million it would need to match leading nations Canada, Japan, and South Korea at 55 percent of adults with a college degree. To make up the gap, the U.S. would need to produce an additional 781,000 college graduates a year — a 37-percent increase over current levels.

Only eight states are currently on track to reach the level of educational attainment needed by 2025 to compete with the best performing nations and meet workforce demands.

College Affordability an Issue

The studies contend that college affordability has created an accessibility issue, as more lower- and middle-class families struggle to deal with rising college costs. Fewer low-income students are enrolling in college, and a large percentage of college students are graduating with record levels of debt.

According to the Trends in College Pricing 2006 report by the College Board, tuition and fees at four-year public universities have risen 24 percent over the past five years, and 32 percent over the last 10, even when adjusted for inflation.

Today, the average student borrower at a public college or university owes ,250 in student loans; 10 years ago, the average borrower attending a public institution graduated owing only ,000 in student loans, after adjusting for inflation.

The studies propose that in order to expand the percentage of its adult population with college degrees, the U.S. will need increase college accessibility for low-income students, as well as for other groups that have been generally underserved in higher education.

Finding Free Money for College That Doesn’t Have to Be Repaid

With the College Cost Reduction Act of 2007 that went into effect on October 1, Congress, as part of an effort to boost college affordability, raised Pell Grant award limits. To be considered for a federal Pell Grant, students simply need to submit their Free Application for Federal Student Aid (FAFSA) each year. Qualifying students will be awarded a Pell Grant as part of their financial aid package.

Millions of other private, institutional, and local scholarships are also available to students each year, both with and without regard to income. Students can often use scholarships to reduce their need for student loans.

Online scholarship databases at NextStudent.com can help students in their scholarship search. This Scholarship Search Engine, for instance, lists over 5.9 million individually awarded scholarships worth over billion, and is completely free for students to use.

Affordable College Borrowing With Low-Cost Parent and Student Loans

With student loan debt on the rise, Congress also acted on student loan interest rates in the College Cost Reduction Act, cutting interest rates in half on need-based subsidized federal student loans over the next five years.

However, even if students don’t demonstrate enough financial need on their FAFSA to qualify for subsidized student loans or a Pell Grant, they may still be able to obtain low-cost, low-interest federal college loans.

Unsubsidized Stafford student loans are available to both undergraduate and graduate students without a credit check or demonstration of financial need. As long as they’re enrolled at least half time, students may defer payments on their Stafford student loans until six months after graduation.

Low-interest, credit-based federal college loans are also available to qualifying parents of undergraduates to help them cover up to 100% of their child’s cost of attendance.

Private Student Loans Available Year-Round

Even after grants, scholarships, and college loans, some students may have education-related costs that exceed their available federal financial aid. For these students, non–need-based private student loans may provide the additional financial assistance they need.

However, since federal student loans generally offer more attractive terms than private student loans, students and their parents should always look into their federal financing options first.

Learn more about Private Student Loans.