As we all know debt is a liability or obligation to pay or render something. Unfortunately many of us find ourselves biting off more than we can chew in this regard. In fact, some friends told me recently they are so far in debt with their student installment loans they have just stopped paying them all together, because in their words, “It was hopeless.”I can’t image feeling that level of despair, although I have my fair share of debt as well. I don’t want anyone to feel that way. Paying for an education is difficult especially if you must do it on your own with no help from family or no help in terms of bursaries and scholarships.
If you’re considering going to school, and I believe you should, than you should have an entrance and exit strategy so not to end up like my friends. And contrary to popular belief entrance and exit strategies do work, the key is actually having one to begin with. Your entrance strategy needs to consider several elements that all center around how much your educations is going to cost you. First you want to consider whether you will live at home and attend college, although for many this is not an option based on where they live. Secondly you want to consider which schools you go to based on what they charge for their courses. Third, you need to consider how you can reduce your living costs which can mean sharing a room and / or getting a part time job. We will discuss more about these in the next paragraphs.
Choosing Your School Based on Cost of Tuition
Did you know the average cost of tuition, over a 4-year span, ranges from $12,500 in public schools to $27,000 for private institutions per year? That’s a lot or debt one can amass in a relatively short period of time. Can you handle a $100K student installment loan repayment? I know I couldn’t swing it, nor would I want to. So let’s come up with a creative solution to help you avoid an insurmountable mountain of student installment loan debt on graduation day. This article will focus on an entrance strategy.
Consider a Community College for the first couple of years. Why? It is far more economical. I am currently attending Massasoit Community College in Brockton, Massachusetts and the cost is $111.00 per credit. I am taking two three credit courses this semester which is costing me $666.00. Next year I will be transferring over to Bridgewater State College to finish my degree program and earn my Bachelors degree. The current cost at BSC is $333.00 per credit hour. Simple arithmetic shows I would have been spending $1,998.00 for the same amount of credit hours this semester if I took them at BSC. That is a 3:1 ratio and a savings of $1,332.You don’t need to be an economics major to appreciate that savings. In addition, many of the professors which teach at my college also teach at BSC. The only disclaimer is that you will want to make sure the classes you are taking are transferable; so check with your school’s Admissions office.
|Massasoit Community College||Bridgewater State College|
|60 credits||60 credits|
|$111.00 (tuition per credit hour)||$333.00 (tuition per credit hour)|
|Total cost: $6,660||Total cost: $19,980|
|Savings: $13,320||Savings: $0|
If you fulfill your core requirements at a Community college, like I did, you may save yourself thousands of dollars by graduation day.
Living at Home While Attending College
The next part of your cost equation which determines how much debt you go into is whether you can live at home or have to pay for room and board somewhere. Living at home with your parents may not be what everyone looks forward to, however if your room and board is free this can really save students a great deal of money and be a central point of your entrance strategy. Even if you must commute some distance it can still be much less expensive living at home and you can study or read on the transit system as well.
Everyone lives differently and has different levels of rent they must pay while attending school away from home. Make a few calls and ask what the cost will be for boarding or renting an apartment somewhere to get an idea of what the cost will be. Based on your eating habits you can come up with an estimate of what the cost will be for your room and board vs. living at home and make a decision.
One last point, if you are living with a bunch of people or at least several other people, they may not have the same study habits as you do and this could severe limit your marks at school. Take this into account and knowing your own personality, make a decision where you want to live.
Working While Attending College
Another factor is whether you will work while attending college. Many students take part time jobs to make it though school and pay for many of their expenses. They must find the right balance between the need for money, study time and the amount of hours you work each week. Your strategy is to first graduate with decent marks, then minimize your overall cost of attending school. Some students will live at home and work at a part time job at the same time and end up owing very little money when they graduate.
Just remember each individual needs to chart his or her own course. What is right for you isn’t always right for someone else. Plan ahead and prepare a budget covering all of your expenses while attending college. Then take the appropriate action that makes the most sense in your own situation. This is one of the first big decisions you will make that will affect the rest of your life in terms of your total debt when you graduate and also the quality of the education that you obtain as well. But one thing we can all agree on is money. We all need it. They say money talks, and it’s true. When it talks to me it says, “David, you are wise and practical.” What does your money say to you and how does it affect your entrance strategy?