There comes a time when you have to decide to take your blogging seriously, and that tie has come for me. I have produced content for about two years, and podcasting for nearly the same amount of time. To help run my site my way, while making use of the best tools such as Yoast, Jetpack, and other SEO maximizing tools, I have moved to my own self-hosted domain, www.collegemoneyman.com.
We want to thank all of our readers for subscribing with us via wordpress.com, and invite you to subscribe via the site. We hope to see you there as well!
Last week was a great week and thank you to all those who asked me questions on twitter @CollegeCashMan, and to my new newsletter subscribers. Heres a summary of what I put out this week, and a couple of other funny articles.
Last week, we dedicated the episode to a discussion of changes in college funding, the decline of smaller liberal arts colleges, and how this will effect merit aid. Listen to the episode: [audio https://s3-us-west-1.amazonaws.com/cmmwordpress/Podcasts/episode34.mp3]
12 years ago, I was high school drop-out on my way to college at age 23. I had made it my mission to return to school with a vengeance. But how to pay for it all? I wanted to avoid student loans at all costs. I had seen what debt did to other families and would have none of it.
I had taken a class in Not-For-Profit grant writing, and found out that the same skills that go into writing grants, apply to the world of scholarships as well. After a bachelors, and a master’s degree, I came out without student loans and over $250,000 in financial aid and scholarships awarded. However, one of the hardest parts about the entire effort was never the essay, or the letters of recommendation. It was organizing the whole process. I didn’t have access to the convenient and ubiquitous calendars we now have that…
Last week was a great week and thank you to all those who asked me questions on twitter @CollegeCashMan, and to my new newsletter subscribers.It was a short week due to a family emergency, but we did get our podcast out last week on time and well received.
This one is offered by Popp and Associates, an Admissions Consulting firm. The winner will receive a college scholarship in the amount of $500, and a charitable donation in the amount of $250 will be given to the winner’s high school, college or charity of choice.
Last week was a great week and thank you to all those who asked me questions on twitter @CollegeCashMan, and t o my new newsletter subscribers. Heres a summary of what I put out this week, and a couple of other funny articles.
For every ten parents that think applying for small scholarships are waste of time, there is that one mother who knows that staying out of debt is cheaper than the hour someone may spend applying for more aid. Checkout this article and understand avoiding student debt takes a multi-step approach.
$2500 Scholarships are available for many students that score well on the PSAT. Taking the PSAT is a great opportunity to not only practice for the real SAT, but also makes your student eligible for more merit aid, along with the pride of becoming a National Merit Scholar.
Worst Tweet of the Week
This weeks award goes to @tamara_kayyyy for the tweet that shows that some kids just hate the effort of scholarship applications. For any parent reading this, take heart! In all likelihood this student will do a poor job of paying attention, miss fine details, and ultimately not finish college if they expect everything to be handed to them. If your kid is competing for the same funds, their odds of winning just got better. Again, poor attitudes usually result in poor outcomes.
This scholarship is one that if awarded, is worth more than the $2500 scholarship itself. The scholarship is awarded by state and only so many per state will win. However, for those that don’t win the prime award, another 1400 are evaluated automatically for other scholarships offered by other companies affiliated with the PSAT/NMSQT. In addition, National Merit Scholars, as they are called, are obviously going to have an edge in college admissions and other scholarship opportunities. We discussed this in a recent podcast for parents and their college-bound teens.
The nice thing is, students filled out the application when you applied to take the test! The PSAT itself, and your results are what will determine the outcome. So if you have taken advantage of SAT Test Prep, or considering it, it is a great way to not only qualify for the scholarship, but to practice before the taking the SAT. So at worst, by taking the test, your college-bound teen has prepared for taking the full exam, while qualifying for scholarships without adding a single application to their efforts.
I grew up with a friend who is now a doctor at a prestigious hospital back home in California. “Tony”, always intended to become a doctor, and worked hard to get there. However, he assumed so much debt in Medical School, a huge part of his budget is dominated by paying them back. Don’t get me wrong, he makes good money now. He is one of the top in his field. However, when we recently talked, he mentioned how much he wanted to quit. A man of deep faith, Tony wanted to spend 3 years with Doctors without Borders doing “good works”. However, paying back his student loans has become his all-consuming goal and he can’t leave the hospital until the loans are paid off.
Welcome to what I call the modern “Golden Handcuffs”
What Are The Golden Handcuffs
In the business world, the term “Golden Handcuffs” refer to certain financial incentives that companies use to keep employees tied to their jobs. An example would be a vesting schedule, which allows the employee to own shares, but not be able to sell them unless they are still employed with a company past a certain date. Often this is 1 to 5 years. However, a new form a golden handcuffs have arisen in the student loan debt that is assumed every year.
Randal S. Olsen, a Ph.D. student at MSU decided to ask the questions, “Could you actually work your way through college“. Randal examined the trend of tuition at MSU and the rate of minimum wage pay in the US. He found (as many of us in college finance expected) that the likelihood of an average person working 35+ hours per week for minimum wage and being able to pay for the cost of attending MSU was nil. The inflation in the cost of college, coupled with the average spending power of a minimum wage worker, has made debt a part of the college experience.
How to Avoid The Golden Handcuffs
Avoiding the golden handcuffs of student debt requires the parents of college-bound teens to take charge of the college financing effort and be proactive on every front possible.
1) Find The Money Before Students Start College Classes
As I have said many times, the sordid love affair of matching a student and a school requires an approach that emphasizes the balance of college fit, with affordability, and aid. The college your student attends must be the one that wants them the most. The way a school shows their love of your student, is via the Merit Aid offered on the financial aid offer letter. The more aid offered from the school itself, the more they want to invest in your child’s success. Take the time to look at sites like CollegeAbacus.com and how looking at the net price calculators side by side will offer a realistic view of college expenses.
Working hard during the high school years towards earning solid grades, and earning higher SAT/ACT scores makes a difference, When coupled with searching for the gem colleges that will offer the best aid can help avoid student-loan debt in the long run as many merit aid awards are multi-year. And when offered, being willing to appeal the financial aid award offered, and/or have your child’s EFC reconsidered will make a difference in the cost your family will pay out-of-pocket
2) Be Proactive & Fight For Additional Financial Aid During The College Years
It’s not enough to get a good package during the first year of school and stop there. Being proactive every year is a must for cost conscious parents. Having your EFC reevaluated each year may make a difference. In addition, using EFC reduction strategies can make a difference in the aid offered. If a job loss in the family occurs, or your family business takes a financial hit, contact your financial aid office immediately. Beyond that, the hunt for scholarships and grants must never end. In fact, there are many scholarships that are not only multi-year, but only qualify for only after you have attended school for a semester. So a relentless pursuit of outside aid, coupled with already awarded merit and federal aid can make a difference between student debt and a debt-free degree.
3) Keeping An Eye On Cost Drivers
Most consider college costs fixed and non-negotiable. I’m here to tell you that college costs can be lowered if you use the right strategies. Everything from the meal plan your child chooses, to how often they come home to visit are factors that are controllable.
Living off campus with roommates, and sharing bills can keep living expenses lower. Letting Junior know they can’t drive home to visit every weekend can cut travel costs. Utilizing community colleges during the summer to cut the total cost of a degree can make a huge difference in tuition costs. Also, taking summer courses is key to the strategy of getting a degree in 3 years, not 4. If you think about it, by reducing the cost of a college education by a year shaves off an entire years living expenses and added fees.
Avoiding student debt while in college is a matter of finding and securing financial aid from every source you can find, coupled with a relentless eye for reducing costs. But this will only work when you and your student work as a team to constantly seek aid, while controlling expenses. As the parent of a college-bound teen, it’s up to you to take charge and get your student on board to the realities of heavy student debt and how to avoid it. It may mean the difference between putting on the golden handcuffs of student loan debt, & financial freedom for your student after graduation.