FOX Business’ Lydia Hu talks to Jessica Daly and her daughter Madison about the rising cost of college as tuition has more than doubled since 2001 on ‘The Big Money Show.’
For many students and families, the rising cost of higher education feels like an insurmountable challenge. Questions like “Which school is right for me?” or “Does prestige weigh more than expertise?” carry their weight, but one question always remains: “How can I save the most money?”
The numbers show the average total student loan debt – including private loan debt – in the US can be as high as $40,681, with the average federal aid borrower owing $37,853 per person.
While the FAFSA (Free Application for Federal Student Aid) is a key tool for unlocking grants, loans, and work-study program opportunities that can help alleviate some of the costs of higher education, relying on the FAFSA alone can sometimes be lead to astronomical debts, and not all students. qualify for the amount of aid they need.
The good news? There are other ways to save dollars on your education expenses. Whether you’re trying to avoid excessive student loans or supplement your existing financial aid, these practical and cost-effective options can make higher education more accessible and affordable:
COLLEGE APPLICANTS FILE CONFLICT AND ANXIETY TO CHANGE SAT ADMISSION REQUIREMENTS: REPORT
1. Community College
Community college building entrance. (iStock / iStock)
What’s in a name? While attending top-tier universities like Harvard, Stanford, Yale, or Columbia may be the dream, these schools and others like them can come at a high price.
To break it down:
- The College Board reports that the average annual cost of tuition and fees for a public 2-year college for the 2022-2023 school year was $3,440 for district students.
- The average annual cost for a 4-year public university was $9,410 for in-state students and $23,890 for out-of-state students.
- For a private 4-year university, the cost expanded to $32,410 per year in tuition and fees.
Even completing just two years at a less expensive school and transferring to a more expensive institution can lower your overall college expenses.
“That’s really big for us in California, where you do two years at a new college and transfer to, say, UC Santa Barbara, UCLA or Berkeley,” Greg Kaplan, an admissions strategist at Fox News Digital, told Fox News Digital. college based in the Golden State. .
Kaplan pointed out that many students start at community colleges and later transfer to more prestigious flagship universities. This path allows students to earn a degree—and institutional recognition—from a top university, but at a fraction of the cost of attending all four years at that dream college.
“We worked with a student who started at Arizona State University for two years on a full scholarship, and he transferred to Northwestern, which is extremely expensive, very prestigious. So he only had to pay for two years,” he explained.
2. Make your employer your partner
A barista pours steamed milk into a beverage cup marked “Steven” inside a Starbucks Corp. coffee shop. in the Sandton area of Johannesburg, South Africa on Monday, January 14, 2019. (Waldo Swiegers/Bloomberg via Getty Images/Getty Images)
Some employers will reimburse tuition for degree programs that can potentially improve their employees’ job skills. In other words, you save money and your employer gains a more talented and better employee. It’s a win-win for both parties.
Tuition reimbursements are often capped at $5,250 per year, in accordance with Internal Revenue Code (IRC) Section 127, which allows companies to provide that dollar amount in tax-free assistance. This can be claimed as a business deduction for the employer and employees receive the refund as a tax-free benefit.
But some employers can do much more than that, even fully covering the cost of an employee’s bachelor’s degree.
“It’s not just the employer match,” Kaplan said. “If you’re a young person and you’re going to be an entry-level worker, you might want to consider working for a company that can be your partner… I’ve talked to people who specifically go to work in a place like Starbucks because they can take classes online at Arizona State and do it to get their degrees.”
The Starbucks College Achievement Plan (SCAP) offers eligible employees 100% upfront tuition coverage for a first-time bachelor’s degree through Arizona State University’s online programs.
Amazon’s Career Choice program similarly prepays tuition and fees up to an annual limit, and Walmart’s Live Better U program offers qualified Walmart employees the opportunity to expand their education with company money.
3. Parent employee benefits
A person holds a jar full of savings. (iStock / iStock)
Instead of relying solely on their employer, some college applicants can take advantage of their parent’s or guardian’s employee benefits, most commonly through company scholarships.
Companies such as Chevron, PepsiCo and Wells Fargo offer reserved scholarship opportunities for children of eligible employees. The PepsiCo Foundation’s Family Scholars Program, for example, offers a renewable award of up to $5,000 to selected winners who will pursue an eligible educational program with the funds.
Once accepted by a university, it’s worth exploring employer benefits and applying for scholarships if eligibility criteria are met.
This amount, combined with the potential for federal and state aid, can significantly reduce the cost burden of higher education.
4. Open a 529 account
Jar with label and money on the table. Concept of saving money. (iStock / iStock)
While it’s best to open a 529 account when college savings begin while the college applicant is a child, setting up an account as an adult and adding small amounts can add up over time.
What is a 529 plan? A 529 account is a tax-advantaged savings account designed specifically for education expenses. Contributions to this account grow tax-free, and withdrawals are also tax-free if used for qualified educational expenses (eg tuition, supplies, room and board, etc.).
It is different from a basic savings account as the money has the potential to grow rather than sit still.
“If you can put away a few thousand dollars a year, of course it all helps,” Kaplan said.
However, a 529 only stretches so far. Kaplan notes that 529 plans alone may not cover a large portion of tuition costs, especially at private universities.
“It wasn’t enough to pay for my overpriced private university,” he added.
5. Prioritize the SAT/ACT
Close-up of a pencil on a page of an SAT college entrance exam prep book, taken on August 6, 2017, in Melville, New York. (Thomas A. Ferrara/Newsday RM via Getty Images / Getty Images)
While many colleges have maintained a test-optional policy in the post-pandemic era, high SAT or ACT scores can give students an edge when it comes to merit-based scholarships. Good scores on standardized tests can help students unlock thousands of dollars in automatic aid, helping ease the burden of their overall tuition bill.
“For example, if you have a 32 on the ACT or a 1400 on the SAT, that will automatically qualify you for a massive (approximately) $30,000 scholarship at the University of Alabama, Tuscaloosa,” Kaplan said, noting colleges of others. and universities give similar amounts.
“These scholarships are automatic based on test scores and grades, so studying for the SAT or ACT, even if it’s not required. Giving them all can pay for all the tuition.”
While taking multiple hours of exams seems daunting to many high school students, putting in hours of practice through extra subjects, practice exams, and even seeking help from tutors can lead to a drastically different financial outcome in the long run.
6. Consider consortium programs
FOX Business Correspondent Lydia Hu has the scoop on why fewer students are applying to college on “The Big Money Show.”
A lesser-known way to save on college costs is by taking advantage of state consortium programs, which allow students to attend public universities out of state at reduced tuition rates. These deals can help families avoid the high prices often associated with non-resident tuition.
In states like California, the Western University Scholarship (WUE) is a game changer. This program allows students to apply to 150+ colleges across the western US – including schools throughout Montana, Hawaii, Wyoming, Arizona, California and Nevada – while paying reduced tuition fees.
“If I have a 3.3 GPA, I can go to the University of Utah for in-state tuition plus a small surcharge as a California resident, so it’s cheaper for me to go to the University of Utah at $11,000 a year than to go to any public university within the state of California,” Kaplan explained.
“There are different consortia in the Northeast and the Southeast and the Midwest and the West, and these are ways that these universities are looking to diversify their students based on geography. I think a lot of people don’t realize that these consortia exist and that they many more schools may come into play and it may end up being the right fit for you or your child.”
GET FOX BUSINESS IN ALBANIA by clicking HERE
