How to Make College More Affordable
November 26, 2014We all know that education is a key element in achieving the financial hopes and dreams that we all have, but is it possible that college education is getting too expensive? One of my colleagues calculated that when he started college at a public university in 1988, a student would have to work 34 hours a week at minimum wage to pay for a year of college. At that same school today, a student would have to work 53 hours a week to pay their way.
To bridge the gap, many students rely on borrowing their way through school through student loans.Americans owe roughly $1.1 trillion in student loan debt – more than what we owe in credit card debt. At current interest rates, for every $10,000 of student loan debt a person has they will have to make a payment of about $100 per month.
With the average student loan borrower coming out of college owing $29,400 that means they would have to cough up roughly $300 per month for 10 years, whether they have a decent job or not. Some may see this as simply the cost of higher education, but as a parent, I’d prefer not to saddle my children with this kind of burden when they graduate. If you or a loved one plans to attend college someday, consider these ways to make the cost of higher education more affordable:
Take the first two years of classes at your local community college.
This can save about $5,000 per year in tuition alone, and up to $15,000 per year if the student lives at home while getting an associate’s degree. That could be the difference between being “average” with $30,000 in debt and graduating debt free.
Look for special tuition or grant programs.
Students that plan to teach in a high-need field in a school or agency that serves students from low-income families for at least 4 years within 8 years of getting their degree may qualify for a TEACH grant. Many states have similar programs for low income and/or rural areas. Students may also receive grants based on their financial need, minority status, or field of study.
Work for a year or two before going to school.
Many students are just not ready for college right after high school and an extra year or two to mature may be just what the doctor ordered. If you plan on working a year or two before heading off to school, look for an employer that offers a tuition assistance or reimbursement program. Some require that you stay on or that the degree relates to your job, but many just offer this as an employee benefit. It also gives you a chance to save some of your earnings and have more cash for school.
Don’t rule out serving in our military.
College went from something for the upper class to entire generations of service members returning from World War II, followed by Korea and Vietnam. Today we have a volunteer military so you have to be sure that a stint in the military is for you. If you would be interested in military service, then the GI Bill could pay for your entire education. There’s a variety programs with different qualifications. Plus, you could get a free education if you’re accepted into one of the military academies.
Education doesn’t have to mean college.
Many economists and business leaders are noting a skill gap in America today. Skilled labor is in high demand for many occupations such as welders, electricians, plumbers, etc. These programs are generally shorter and lower cost than a 4-year college degree so you spend and/or borrow less and start earning money earlier. Many companies will even help pay for your training. Look for a Registered Apprenticeship program in your area if this career path appeals to you.
None of these options are necessarily easy, but neither is paying on a student loan for the next 10–25 years. If college is in your future, consider these ways to avoid putting that student-loan monkey on your back. You’ll sure be glad you won’t have that payment every month.