Is a
college education still a good financial investment? According to USA Today’s Country
Financial survey of 3000 adults 18 and older:
Year Yes No
2008 81% 19%
2009 79% 21%
2010 64% 36%
2012 57% 43%
As a result
of the rising costs of college tuition and fees, many prospective college
students are doomed to borrow big bucks to help fund their college education. Did
you know there is a way for college students to avoid a life of big college
bills and college collector’s calls? In the past, a bachelor’s degree was a guarantee
of success – the only credential needed to obtain a good job, a promotion, a
raise, or employer provided health and dental insurance. In today’s economy, a
bachelor’s degree guarantees scary debt and a life of financial struggles
especially when funded solely by loans.
Consequently,
the answer is for students to find other ways to pay for college (part time
work, savings plans, savings bonds, long term investments), reduce college
tuition cost by choosing to attend in state colleges, and borrow no more than
$5000 a year to help defer college costs.
Did you
know the average cost for 4 years at Rutgers: The State University in New Jersey
is about $80,000? Conversely, 2 years at Middlesex County College in New Jersey
is $20,000 for out of county residents and $10,000 for in county residents. So
let’s do the math. A student who decides to attend a New Jersey County College
for 2 years ($20,000 in county) and then transfers to a 4 year college in New
Jersey ($40,000) will have a college expense of $60,000 upon graduation. The
savings of $20,000 over four years is quite significant, especially since
$20,000 is the lowest recommended loan amount each college student should
borrow to pay for college. Student loan debt of $20,000 should be payable by
most students over 10 years.
But what if
students cut their costs, work part time (no more than 15 hours a week during
the school year), borrow modestly, and they still need more money for college?
How much more money should they borrow without ruining their lives and credit?
The key is to match student loan debt with expected income after graduation. For
example, future musicians should borrow much less than future physicians.
In the end,
the decision to attend college is a very personal decision. Of course there are
many factors families and individuals have to weigh before submitting those college
applications. I hope this information was helpful. If you know a family about
to send a child/children to college, pay it forward and pass it on. Knowledge
is power! Here we go!!!
Here is a list of college resources:
College
calculator: http://cgi.money.cnn.com/tools/collegecost/collegecost.html
NJ 529
College Savings Plan: https://www.njbest.com/?nicamp=njbest-themes-college%20savings&nichn=google&niadgrp=college&nipkw=college%20cost&gclid=CKGQy-aIyLICFedxOgod5yIAnQ
Savings and
Treasury Bonds: http://www.treasurydirect.gov/indiv/tools/tools_savingsbondcalc.htm
Federal
Student Aid: http://www.fafsa.ed.gov/
Student
Loan Forgiveness: http://www.staffordloan.com/repayment/forgiveness.php
Teacher
Loan Forgiveness: http://studentaid.ed.gov/repay-loans/forgiveness-cancellation/charts/teacher
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