In a regular year, paying for college can be a big deal. Now, in the middle of a recession with social security cost of living payments and the price of stamps foregoing increases, college tuition is moving right on up. In fact, economists say the recession is what's causing the rise.
This time the hikes can't be blamed just on the private schools – state colleges are increasing prices at even faster rates. Economists and college administrators have various reasons for the uptick, but it's clear that getting the most for the money is more important now than ever.
Community College as a Gateway
One way to save on college is starting at a local community college and moving on to a four-year school. This can be a great way to completing some of the basic classes needed for most degrees and dive right into major classes once reaching university.
Community college isn't the best fit for everyone, but students who know they want to get a four-year degree but can't afford it right away can find an appropriate segue into a university education with community college.
Not only do community colleges charge less tuition than regular four-year schools, students can often live at home and keep a part-time job to help save money. Many four-year schools will accept community college credits, but it's important to check with university administrators at the school of choice before applying.
529 Plans
According to Kiplinger, a source for financial advice and business forecasts, college just got cheaper in some states. The state-run 592 college savings plans instated in 1996 to help families save for college tax-free are becoming more affordable thanks to competition between the firms that control them.
There are two kinds of 529 plans: savings and prepaid. Savings plans give the saver investment options that determine the health of the overall plan depending on their performance.
Prepaid plans allow full or partial pre-payment of public college tuition fees that can then be transferred to private or out-of-state schools.
Other Ways to Save
There are, of course, many other ways to plan and save for college, and various foundations set up for helping students and parents with these tasks. Many banks issue loans to members and hundreds of community organizations in the country give out scholarships. Students can also get merit-based or finance-based scholarships from their school of choice, as well as grants from specific programs at the school. These grants can be broad and cover a certain amount of school tuition, or they can be specific to a study abroad program or research project.
Here are a few of the more popular foundations with advice on how to save for college:
-- savingforcollege.com: their mission: "to help individuals and professional advisers better understand how to meet the challenge of paying higher education costs." They have a lot of "how to" advice on using 529 and other college savings plans, as well as products for sale.
-- finaid.org: FinAid is a free student guide to getting financial aid for college. It lays out directions for applying for loans, scholarships and grants and also has specific information for members of the military looking for financial aid for school.
--College Savings Plans Network: this network is similar to savingforcollge.com in that it lets you compare 529 plans in different states. It also has a college cost calculator, which can be useful when figuring out just how much needs to be saved or borrowed.
Hidden Costs
When applying to college, it can be easy to forget that tuition is not the only demand on the wallet. Once accepted, students or their parents will be expected to pay a whole host of other dues, from room and board to books to recreational charges like club sports or Greek organization enrollment fees.
Most college and universities will have room and board, meal plan and textbook dollar amount estimates on their websites or in brochures sent to applicants. It's also important for students to think about the kind of activities in which they may be interested in participating once enrolled, so that a budget can be set aside for these things as well. It's always a good idea to budget for a little bit more than the student thinks he or she will need.
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