|By Alexander Carl on March 5, 2010
A college education is one of the wisest investments a person can make— think of how much more earning-power comes with that seemingly magical piece of paper. Not to mention the personal growth that develops alongside it.
But college is expensive. Let’s reiterate that: college is expensive. The costs of education rise disproportionately to the rate of inflation, and because demand is so great, post-secondary institutions will charge as much as the market will bear.
Are you panicking? Don’t. There are ways to save and ways to cut costs:
Save early. A wise maneuver is to start a college fund for someone as soon as they are born. Taking investment risks early on can lead to big gains later, helping combat inflation.
Try a 529 account. A new savings method, the 529 allows for tax-free growth and withdrawals, specifically for going to college. However, a penalty waits if the child in question does not attend school.
Let’s say a student and her parents have been saving along, and now she’s been accepted into Bankrupt U. Apparently, no other school offered a comparable program for a lower price.
They’ve talked with their B.U. financial aid officer and received a few grants and a scholarship, but they need to use student loans to cover the remaining costs. Are there still ways to reduce their expenses and take on less debt?
Yes! Even little cost-cutting measures make a difference:
Take AP courses in high school. Fortunately our student challenged herself early on, and has received enough course credit to eliminate a whole semester of college, possibly even a year.
Shop for housing. Our student learns that B.U.’s dorms are a better deal than the local town’s apartments, even though she has less privacy.
Transfer from community college. Bargain Tech offers courses that can transfer to Bankrupt U., so our student enrolls in a couple over the summer for a significant price break.
Consider a tuition installment plan. By breaking tuition payments into smaller amounts, our student’s family can build college into their budget less painfully.
In the end, their loans are smaller, and the student has less debt look forward to after graduation.
How are you saving and cutting costs?