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- Paying for College
Reducing the College Burden
College is a hefty sticker price. If you are lucky enough to receive a scholarship to a solid university that pays all or most of the expenses, then my suggestion would be to take it. Unfortunately, most people don’t get that. To give you some perspective, most people choosing to go to college will be taking out loans to help fund the majority of your tuition. By law, those loans will virtually never be discharged in bankruptcy if you were to file.
If you graduated today, your average college debt would be $29,000. You can bet that figure will go up if you graduated 4 years from today…if you don’t take preventative measures. Here’s another point to further stress the seriousness of it, if hypothetically, the student died and the parent/guardians cosigned, they are now responsible of the loan debt, meaning that burden will go on beyond the grave.
Before enrolling into college, do your research. The pressure of going to college can come from a lot of people ranging from teachers, guidance counselors, and from your parents and peers. Most of the caring people in your life ultimately want you to have a good if not better then themselves life…sometimes to a fault. Be rational about your choices because they can affect future outcomes. Keep in mind that “good” and “better” is all relative depending on the choices you have taken. If you went to a university and graduated with 50-100k in student loan debt then already you are starting at a disadvantage, with a mortgage payment and no house. Meaning the wide net of choices has gotten a lot narrower.
What is the Price Tag of this University?
All of you know that paying back loans will contain some sort of interest and you won’t have to start paying them back until six months after you graduate. However, one could wager that a lot of you didn’t know most student loans (excludes subsidized loans), the interest will accumulate and be added to your overall principle each month you aren’t paying while you’re enrolled. Yes, there is a price for money, its interest and not paying over the course of your time in college doesn’t mean free. There are a few steps you can do to help reduce that debt burden over your college experience.
Look into the schools you want to attend. Do your research! Going to a private university may cater better to you educational and financial needs, they also cost significantly more; basically almost double. As stated before, each situation is different. In the end you want to measure your net costs and net benefits. How much will it cost you when you have reached the finish line?
Also look to cutting down the fat attached to a university. That fat can consist of room and board. Part of the experience of college can be rooming with a bunch of students and make new associations, as advertised. It’s an overrated commodity, especially with the price tag involved. You can make associations by being in school while in or between classrooms. Living with your parents and commuting may not be the sexiest option but here is some food for thought; room and board at most universities is roughly $10,000 per school year, if you’re only spending $30 a week on gas and another $30.00 a week for your lunches over a 30 week period (Spring and Fall semesters) you are paying a fifth or less of total room and board costs.
You Can Take a Back Road
You may want to consider going to a technical/community college first. You could save thousands of dollars on your tuition. You can also knock down some core classes to your overall education goal. However, you have to play it smart.
If you have a clear idea of what you want, you can complete and fulfill all of your freshmen and sophomore requirements and transfer the credits to a university. One could say, “Well what if the credits don’t transfer?” That is a valid concern but you can greatly minimize that risk by comparing the transfer dictionaries between both schools. Each university website has one for comparison (though not very advertised). By doing it correctly and consulting department directors and counselors, you could potentially have 60 to 70 credits transferred. If you want to go bold, you could earn an associate in one field in two years at a community college and then get a bachelor in another field in two years at a university, if done correctly.
This does require you to stay vigilant. Make absolutely sure your credits are accepted and are able to eliminate core degree requirements. You don’t want to be in a situation where you are unable to transfer credits (hence waste money) or over-saturated in electives that are not lined up with core bachelor requirements. Again, do your research! Speak with admissions offices at the university you want to transfer to and discuss the policies as well as reviewing transfer lists.
Always keep in mind that while you are unlikely to get a scholarship that pays all of your educational expenses, it doesn’t mean you won’t get any free money. Apply to as many as you can, even if they don’t relate to what you are doing. By applying to three or four dozen the chances of you winning two or three of them are greatly increased. Free money is money and if it helps you reduce the overall burden; then take it. Here is a list of the top 10 scholarship websites.
You can also take advantage of the “American Opportunity Tax Credit.” This could give you a maximum annual tax credit of $2,500 on your tuition until the year 2017 (baring some kind of extension). Using $2,500 on your education over three or four years can amount to one year of tuition. My suggestion, don’t squander that money on some nifty gadgets or stuff you may like but really don’t need. Each year, take all of the credits and apply it to a loan you have taken out or to tuition for the next semester. If you are going to have student debt once you graduate, you want to reduce the overall debt amount as much as you can.
Money, Money, and Money
Get a job! If your major does not involve the hard sciences or engineering, you are likely to have a fair amount of spare time. Well what about grades? Yes, doing well in school is important, especially if you are taking the community college route but actual job experience is just as important, especially if it relates to your degree. It’s not just about the money; it’s the work experience. Employers are looking for productive workers not loafers who partied their way through school.
If you’re working and earning money…save it, save it, and save it. Too many people have worked squandered their earnings on stuff they really didn’t need and ultimately didn’t even care about. You don’t have to be a hermit but if you are working and spending less than you earn, that’s saving and every bit counts. If you have a sizable pot at the end of your college run, you may be able to put a significant reduction on you overall debt. You may only live once but debts hang around until they are repaid and if you are dead the bank won’t care because they will go after your parent/guardians if they are cosigners.
So what kind of employment? A seasonal part time job during school, therefore you can still have the flexibility to study. During the summer and winter breaks take a full time job through a staffing firm, if it relates to your degree that’s even better. Having some kind of work study at school is another option; however those jobs will not pay you as much nor give you the consistent work experience or references of a real job. If you do work study, designate those earnings as play money.
Things to Consider
These are ultimately serious discussion that the parties involved should discuss. Parents and their children ultimately want what is best but be mindful. If someone was to buy a car or house at price that person could pay but would to lead to trouble once a hiccup occurred, then was that purchase really worth it? To make college education not a part of a similar discussion is just as foolish. The only difference that is a bank or the government won't send a repo-man to repossess your diploma.