This is a guest post from Bill Muhlenfeld, who runs a site that’s focused entirely on college money issues for parents. Learn more at Money Launch My Kid.
No dollar tips or piggy banks here. We’re going to talk about the big numbers.
Are you trying to figure out how you’re going to pay for your kid’s college with your savings in the tank? Worried about your college graduate leaving with a degree and ten years of loan payments?
Robbing from your 401k or IRA to fund college are among the worst ideas, even more so now that the values of many of those investments are chopped in half due to the economic downturn. There are many sleepless nights in the homes of the college bound now that parents and kids are struggling with the difficulty of floating $200,000 in costs over the next four years without barrel-rolling the family finances over a Niagara of debt.
If you could save tens of thousands of dollars and maybe forgo borrowing altogether, would you? It is not only possible, it’s absolutely doable; and a reminder that the simplest solutions are often the best. Here are three mega-saving ideas for the new (and the old) student:
- Start your son or daughter out at a community college, transferring at the end of year one or two. This has become greatly popular during the current recession, and has driven applications up by double digits across the country. Why? It works. When I attended college I was entirely on my own and had a little bit less than no money. I went to a two year college (“junior” they called it then) and transferred in year three. My BA is from the University of Illinois. Nowhere does it mention that I only spent two years among the Fighting Illini. I left college with a degree and no debt.
- State schools are also experiencing a sudden, unexpected interest and upsurge of stay-at-home students, all in the interest of saving many thousands of dollars in tuition, fees and living expenses from more “desirable” out-of-state and private universities. Oregon State, for example has a 12 % increase of new applications, a number which seems to hold up across the country.
- Let’s not leave Oregon State quite yet, as it is the flip side of our final mega-buck college savings tip. While new applications are up 12%, student transfers are up an astounding 31%. Cash-strapped kids are returning home, where state-supported schools offer some of the best bargains in education.
Remember, you are not alone. Just make sure you get to the front of the line. Even the community colleges and state schools are starting to tighten up on admissions due to the increase in applications.