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Confessions and Confusion in College Funding

The mom of a high school senior recently asked for college fundings suggestions. Since it is selection season, I thought I would share a few of these. College funding is a well-covered topic, so these are a few I believe aren’t talked about enough. 

College choice is a HUGE part of the funding equation. A good public school can be a great value! One of the best ways to reduce student debt is by making strategic decisions about which college to attend. 

Apply for all the grants and scholarships you can. A significant number of grants and scholarships go under used. Too often people assume they won’t get one so they don’t apply. The time required to apply is usually a tiny fraction of the possible payoff. The process of applying is a great skill to build and will come in handy when it comes time to apply for a job. With today’s technology it is easier than ever. I’ve seen a student receive $2,500 from an industry association simply for filling out the form and being one of the names randomly selected. If there aren’t a lot of people applying, the odds of success go up. Local Dollars for Scholars, area chambers, and industry associations, are good options outside what is listed on the financial aid boards. 

Over communicate with the financial aid office. A study that reviewed financial aid offer letters from 500 colleges and universities found there were 136 different terms used to describe federal unsubsidized loans. If that isn’t confusing enough, 24 of those terms did NOT include the word “loan.” This helps explain why according to a Business Insider survey, 27% of millennials didn’t understand the terms and policies when signing up for student loans. Once you have a written offer in-hand, follow-up to clarify and make sure to understand the full offer. What terms apply? What, if any, conditions must be met to keep it? Do you have to maintain a certain GPA or fulfill other requirements? Do the funding options apply to all years or just the first year? It’s not uncommon for schools to put requirements around scholarship funding for year two and beyond, so it’s not a given you will receive all the funds offered.

Housing selection is another way to save big. In many cases, room and board is more than tuition. A willingness to walk an extra block or two can save thousands of dollars. For some, the meal plan is important and great value if you are a big eater. Having a roommate can be a blessing or a curse, but it usually saves you money. All this to say, there is a wide range of pricing for room and board. It is also one of the reasons many schools now promise to help students graduate in four or less years. The number of credits (tuition cost) may be the same but an extra year to graduate can cost another $12,000+ in room and board. 

Work for the money and career experience: After the first semester or so, I recommend students get involved in something they can put on their resume. The income helps with expenses and the work itself usually offers valuable lessons. In some cases, volunteer work in your field of study could be more valuable than a paycheck. As long as valuable experience is gained, it is time well spent. I know a student who volunteered for a department related to her career interest to see if it was, a good fit. It was and it turned into a nice college job that became a professional position after graduating.  

Do you really need to study abroad? Study abroad and other great college “experiences” not directly related to getting a degree can be wonderful, but COSTLY. These extracurriculars should be evaluated carefully. A college advisor confessed to me she often felt conflicted following her college’s guideline of pushing every student to study abroad. She knew some students couldn’t afford it. 

I’ve seen students take a summer art class in their country of choice only to have their GPA take a hit.  They didn’t realize how extensive the study requirements would be and their real intent wasn’t to study art, but to explore a different country. Another student’s best study abroad option was in Scotland in the cold months of winter. She didn’t need the credits, so instead of paying $10k for a winter in one country, she spent $5k traveling with friends to multiple countries in the warm summer months. 

These last few recommendations relate to the tricky lifestyle choices we all need to get comfortable making. Learning to evaluate and make them in college is one of the many valuable lessons learned outside of the college classroom.

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