Meanwhile, the federal government continues to pump money into the higher education market, thereby causing demand-driven tuition inflation.

Karen Damato of the Wall Street Journal reports:

Families Borrow Less for College

American families are relying more on their income and savings—and less on loans—to pay for college, according to an annual study by education lender Sallie Mae, formally known as SLM Corp.

In the 2013-14 academic year just ended, the typical family paid 22% of total college costs by borrowing, down from 27% in each of the preceding two school years.

These families paid 42% of college costs by using income or savings from the parents and/or student, vs. 38% the year before and 40% in 2011-12, according to the Sallie Mae study, conducted by market-research company Ipsos Public Affairs.

For low-income families, a big increase in grants and scholarships made the reduced borrowing possible, said Sarah Ducich, a co-author of the report. For higher-income families, the continued strong stock market enabled them to take out more dollars from investment accounts.

The average cost of college, $20,882, was relatively stable for the third year in a row after peaking at $24,097 in the 2009-10 year. These figures don’t take into account any grants, scholarships or other nonloan aid students may receive.

Cost-conscious families “are not going to write a blank check” for college, Ms. Ducich said. “They are making a lot of decisions to control the cost.”