College costs up 50%! “What?”…you say. Ok, I used this headline as a cheap trick to grab your attention. But in many cases, it’s ‘almost’ true. First, college tuition has risen approximately 6%; then subtract 40% or more for the stock market decline and your costs of paying for college have risen almost 50% if you had a substantial portion of college funds invested in stocks. Maybe your situation is not quite this bad but the combination of continually rising college tuition and fees along with the depressed stock market and a faltering economy are reason enough to stop and re-evaluate the college strategy for your children.
- Attend a public university instead of a private college. This is particularly pertinent if your child is likely to pursue a career in a field that typically has limited earnings potential. The math can be compelling. Currently the average costs including tuition, fees, room and board for a public in-state four-year university is $18,000 annually while the same for the average private college is twice that amount or $36,000.
- Start at a two-year college then transfer to a four-year public university or private college. This strategy can save a tremendous amount of money. First, tuition for the average two-year community college is about half that of a four-year public university. Also students often live at home saving the cost of room and board. Finally, the lower financial output gives your stock portfolio two more years to recover…enough time for a stock market rebound.
- Become a financial aid expert. There are tens of millions of dollars available for student aid in the form of grants, scholarships and loans. Your best strategy is to start early researching financial aid possibilities based on your financial situation, your child’s situation and your college preferences. Remember that there are scholarship and grant programs that are not based on financial need. These include programs for gifted athletes, students with high grades or high entrance exam scores, gifted students in art, music, computer science. Get started now by visiting The Resource Center at www.welchgroup.com; click on “Links”; then “College Scholarship Search Engine”. You’ll be able to search over 3 million scholarships worth over $16 billion!
- Have your child work during college. Whether it’s a part-time job during college or a summer job, the extra money can make a big difference as well as increase the child’s appreciation for the college education they ‘earned’. Well, maybe they’ll appreciate it later in life!
- Accelerate college studies. There’s a mindset today that college is now a five-year program. Such a mindset will only increase college cost 20% or more. It’s still possible to finish college in three or four years and this should be part of your strategy. Your high school student may be able to take community college courses that will transfer to college. Also, inquire if any high school advanced placement courses qualify for college credit. Finally, consider summer courses at the local community college. This will cut expenses significantly while speeding up your child’s graduation date.