Tuesday, January 27, 2009

Keep Your College Costs Down

Tip #58 - Keep Your College Costs Down. No doubt about it, college is expensive. Very expensive. Many private colleges' annual costs are $40,000 or higher. Seriously, this is an annual income for many people. And while I'm sure the academics are good at most of these private institutions, a college degree can be had for much cheaper than what the private schools want to charge you.

--If the goal of college is to be able to get a good job when you are finished, there are hundreds of public colleges with excellent academic reputations. And they cost half the price of private college. Sometimes even less. Many magazines do an annual report on the best colleges for your money. I found this link at Kiplinger's that lists the best value for public colleges. You can search by the whole country or just your home state where costs are even cheaper. When I did a search by the whole country, I saw many public colleges listed for under $20,000 per year. A lot of money, still. But a whole lot better than private. Search by your state and see which colleges are listed.

--Another thing to consider is how far a school is from your house. If a school is out of state or clear on the other side of your state, you will be paying high travel expenses to get to and from school and on holidays. If you have to factor airfare and gas costs into your college costs, then your expenses will go up. Make sure you look into all costs involved in the schools you choose.

--An even cheaper way to go to college is to find out about the large state universities in your state. Many of them have local campuses so you or your child does not have to pay for room and board. That alone can save up to a third of your expenses. And you still graduate with the name of the university. Or, if the local campus doesn't have "the name" that you want you can always start out there and move up to the main campus after two years. Usually, there are no problems transferring credits since it's part of the same institution, as long as your grades are good.

--Let's go even cheaper. If you haven't saved much for college but you want to go, without forking out a fortune, why not try community college for two years? Then after two years, transfer to your state university. Community college costs are almost always less than even a local university. If you can to there for two years, then your total college expenses will be cut down dramatically. Of course you have to do well and then apply to get in to the University of your choice. But if you are committed to it, it should be no problem. Universities often look for students who have proven themselves at community college.

--Of course there is always financial aid. While I am not a big fan of huge debt, school loans generally have favorable terms. The key here, I believe, is to take out a school loan if you need to, but do it for the lowest priced college with the academics that you want. Taking out a loan for a private university will set you back several years in the savings department while you have to pay it back. And I'm not sure that the private university name will lead to such a good job to make up for the price that you are paying to go there.

--There are also scholarships. I know people who have gotten them. Some were academic, some were athletic, and some were based on financial situation. Scholarships should be looked at as a bonus, since you will often not know about them until late in your college choice decision making.

--Think creatively. Can mom or dad get a job at a university that gives out discounted tuition to family members? If the school is inexpensive to begin with and its one you think your child will go to, then it may be worth it to look for a job there. Of course, this only makes sense if the income, benefits, and job security are the same as a job you are leaving. Or if you weren't working in the past, and this is an extra job. Not all schools offer this benefit, but it may be worth it to find out if one you or your child is interested does offer it.

--Take AP (Advanced Placement) classes in high school if your school offers it. Many colleges accept AP high school credit if you get a certain score on the AP test. By entering college with some credits to your name, you may be able to save on paying for some college credits or even a whole semester!

--Take classes in the summer at community college. Your student may be able to take some college credits at a local community college in the summer that may transfer to the college of your choice. These courses are almost always less expensive than at a regular college. Make sure they will transfer before taking them.

--Get a job. Can you get a job that will pay your tuition costs? This may not be feasible for a student coming out of high school. But it often works for master's degrees. Many businesses will pay for some or all of a higher education degree of their employees if it's in the field you are already working.

In Real Life (IRL) - I've mentioned before that my dad paid for my college education as well as that of my brother's and sister's. But my parents were not going to pay for us to go anywhere. They felt that we could get as good of an education fairly close to home. My parents wanted us to stay within three or four hours from home so there would be no flying expenses. Their argument was that there were many good colleges close by, that there was no need to go far away. And while we did consider some private schools, when we compared them side by side with the public ones in terms of cost and quality of education, the public ones won out. My parents did say they would make an exception if we were Harvard material and nothing else would do, but unfortunately, that wasn't the case.

While none of us went to a local campus first to live at home, it was an option had we chosen Penn State. Living in Pennsylvania, there are many local Penn State campuses throughout the state that one can go to for two years before going up to the main campus. I know many of my high school classmates who did this in order to save money. They lived at home for two years and then went up to Penn State main campus for the last two years. They still had the college experience of living away from home and got to graduate with the Penn State name.

While I don't have any personal experience with community college or student loans, I do have friends who received scholarships for school. (I, unfortunately, did not.) I have one friend who grew up in Maryland. He was very bright and probably could have gone to Ivy League type schools, but he lived with his single mom who probably couldn't afford such a school. He was offered a scholarship for a state school and went to University of Maryland for computer science. He excelled at his studies and was able to get a good job upon graduating. Twenty years later, he still does quite well. And I don't think going to a public university hurt him at all. When he looked for jobs, he proved himself with his skills and experience.

I know another person whose parents offered to pay for school at a public institution (also in Maryland) but told him that if he wanted to go to private school, he had to pay the difference. This guy was also very smart, and he thought a private school name would make a big difference in his job opportunities when he graduated. So he chose a well-known private university. His parents paid for part of his tuition, and he took out loans for the rest. I met him a few years out of college and he said, the private school name that he went to did not help him with his job prospects. He said he would have done just as well at University of Maryland and without loans to pay back. I'm not saying this will be everyone's experience, but this was his experience.

As far as working at a college so your child can go for a discounted rate or for free, I have heard that this benefit has decreased dramatically since I went to school over 20 years ago. My sister worked at a local private college after graduation and there was a secretary who worked there. She said she was never going to leave her job because her son's school tuition was going to be free there. My sister earned her master's degree for free while working there. I also had a friend at college whose dad was a university professor there. Her tuition was free for all four years.

I took AP Calculus in high school and was able to get 4 credits for it in college. Because the program I was in required 125 credits for graduation and my tuition only paid for 15 credits per semester (anything above 15 credits cost extra) for a total of 120 credits throughout the four years, I only needed to pay for 1 extra credit during my four years. I have heard of people who enter college with over 20 AP credits. By doing this, they could graduate a semester early - saving a semester's worth of tuition. Some of my friends took some of the introductory college courses at community college in the summer. The per credit cost there was cheaper than at our university.

My last life experience with college costs was for my master's degree. I worked at a job after college. And they did offer education benefits. It was not the most generous, but it was something. It basically paid for the equivalent of two college courses per year if you went to a local public institution or one course at a private institution. I got my master's degree over a five-year period by taking two courses per year at a public university at night while working at that job during the day. There were a few courses I had to pay for on my own since they weren't directly related to the job I was doing, but the company approved the rest. So my master's degree program cost only a couple thousand dollars total. Much better than if I had gone full-time directly after college and not making an income.

So while college is expensive any way you look at it, there are several ways to keep your costs down. If you start thinking of various ways to pay for college and what would be a good fit for your child and your pocketbook, you may be able to keep your college expenses at a minimum. Anyone else have other ideas on keeping college costs low?

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