By Suzanne Shaffer
Everyone likes a good bargain.
We rush out on Black Friday to get the best deals for Christmas — we stand in line in the freezing cold to save money! But do parents put as much effort and attention into finding a college bargain? Student debt statistics would say they don’t.
According to the Project on Student Debt, in 2013, 69% of all students graduating from four-year public and private non-profit colleges had student loan debt averaging $28,400. Would you want your student graduating from college saddled with that debt? I imagine not!
College bargains do exist and if you have a student who intends to start college in the fall, it’s your job as a parent to point him in their direction. College is a huge consumer purchase which you can and should approach much as you would the purchase of a home or car. Do your research, compare the prices, and help your student choose a school that gives you the best bang for your buck.
One of my favorite movies is Mr. Blandings Builds His Dream House. In it, Mr. Blandings tells his lawyer that “some purchases you make with your heart and not your head.” As I said, I love the movie, but this is bad advice. When it comes to your college “purchase,” use your head first and then listen to your heart.
I understand that it can be challenging to get students to look at the college choice from this point of view. When my daughter was applying, all her choices were east coast private schools with huge price tags. As a parent, I wanted her to have her dream but, also as her parent, I wanted her to graduate without being burdened with debt. Her heart told her to go to the college that offered the least amount of merit aid. Her head, after a long “money talk” and re-evaluation of her second choice, led her to a school that allowed her to graduate with a small amount of student loan debt. She’s grateful every day that I guided her in that direction.
How do you find the most generous colleges?
You can begin your search with colleges that are able to meet 100% of demonstrated financial need for an accepted student. This means that the institution will provide the financial assistance to make up the difference between your EFC (Estimated Family Contribution) and the cost of attendance. Some colleges, however, will include student loans in the financial aid award. Here’s an extensive list from The College Solution blog: List of Colleges that Meet 100% of Financial Need.
Public universities are usually good bargains but in-state tuition varies dramatically from state to state.
You can also use a net price calculator to determine the true cost of attending an institution. These calculators — found on college websites — allow you to determine the net (vs. “sticker”) price of the college after you plug in your financial data. Since college net price calculators vary and there are no guidelines to make them consistent with one another, I like to use the Cost of Learning calculator. The Cost of Learning tool uses multiple data sources and proprietary data analysis and modeling to ensure accurate results.
You can do your own research on websites such as College Navigator and College Data where you can compare schools by researching the percentage of students who receive aid and the amount of aid a college provides each student. You can also view data on how much of that aid is scholarships or grants (money that does not have to be paid back) and how much is student loans.
Are there colleges that a student can attend for free?
There are, but there is always a catch. Tuition is free at the nation’s military academies but students are required to serve in the military after graduation. The College of the Ozarks provides full tuition for students who are admitted and demonstrate financial need, but students are required to work on campus while attending and work during college breaks. There are others, often small in size with unique degree offerings. U.S. News provides a list: Save Money by Attending Tuition-Free Colleges.
When my daughter was begging me to attend the college that offered her no financial aid, I had to provide some tough love and explain why she did not want to borrow $100,000 for college. It can be hard for a high school student to understand the consequences of that amount of debt, but it’s a crucial teaching opportunity for parents. I might have avoided the difficult conversation if I had done my research in advance and had the “money talk” with her before she submitted her applications.
Learn from my mistakes and from the mistakes of so many other parents. Do the research before your student applies and discuss what you and your student can afford. It saves much drama and disappointment when offers of admission arrive.