A Look at the Cost of a College Degree & Ways to Reduce It

Living Happily Ever After – Is it Possible?

A Look at the Cost of a College Degree and Ways to Reduce It

By Katherine O’Brien, MA CCPS

For many, their dream is to go to college, graduate, get a good job, make decent money, and live happily ever after.  Unfortunately, for many, that does not come to pass.  In this article, we’ll explore several of the reasons why and some options to consider in order to make that dream into a reality.

What does college degree actually cost and What Can We Do to Lessen that Cost?

For those who start with about $16,000 in savings, get scholarships, grants, and work to help pay for school, they will accumulate about $42,000 in student loan debt during the six years it takes most students to earn a bachelor’s degree.

In contrast, if s/he had decided to be a restaurant server rather than go to college, the student would make about $39,000 per year (assuming s/he is in the top 25% in a metro area like Houston).  In six years, after taxes and the cost of living adjustments, s/he would make just over $81,000, rather than racking up student loans.  In other words, s/he wouldn’t have a degree, but would be $123,000 ahead of the average college graduate ($81,000 + $42,000).

How long will it take the college graduate to recover that lost opportunity cost and catch up with the restaurant server?  Assuming the graduate gets a job in a field like marketing that has a starting pay of $51,000 per year, it will take 18 years to catch up with the restaurant server, assuming s/he pays off the loans six years faster than average.  This also assumes that the server’s salary steadily increases every year.  While catching up, the college graduate will pay over $18,000 in interest, a total of over $60,000 in loan payments.

What are the alternatives?

1.     Attend a Public university to lower costs?

Many people think that the only option to make college affordable is to send their children to public universities, given their lower tuition rates.  Let’s explore this assertion.

The average in-state tuition is almost $10,000.  The average out of state public tuition is $25,600 and the average private college tuition is almost $35,000.  However, those are the sticker prices.  The average net price (out of pocket cost) for tuition is $4,000/year for publics and $15,000/year for privates, per Big Future.  In order to see the cost to earn a degree, we must also consider the average number of years to graduate: public university students average 6 school years while privates average just above 4 school years.

Here’s a look at the math:

Public universities:

$4,000/year * 6 years = $24,000 tuition, on average

$10,800/year * 6 years = $64,800 room & board, on average

+ $47,268 lost wages $909/(bls.gov median weekly earnings of FT workers with HS education)

TOTAL COST OF DEGREE: $ 136,068 + $27,000 in loans (approx.) (+ fees, books, etc.)

Private colleges:

$15,000/year * 4 years = $60,000 tuition, on average

$12,210/year * 4 years = $48,840 room & board, on average

TOTAL COST OF DEGREE: $ 108,840 + $33,000 in loans (approx.) (+ fees, books, etc.)

Here’s a second look, with figures from a different source.

At end of 6 years,

Public university graduate - $27,000 debt

Private college university graduate’s financial status = $68,480

2 years of working at $50,390 (Money mag) = $100,780 – $32,300 debt (with 75% in debt)

(Data from Mark Kantrowitz, 2012)

[For profit college graduates (88% have debt) with the average debt = $39,950]

[A word about for-profit colleges, in addition to their students carrying more debt, their graduation rates are much, much lower than non-profit colleges, with an average of only 19% graduating in 4 years.]

Since the idea of attending a public university to save money on college isn’t actually very effective, we’ll explore some alternatives.

2.     Graduate FASTER!

There are several ways to shorten the length of time to earn a degree (in addition to attending a school with a 4-year graduation rate of over 50%).  By working ahead via AP, IB, CLEP, and DSST exams as well as dual enrollment opportunities during high school, the student, depending on his or her abilities, can accumulate as much as two years’ worth of college credits while still in high school.  Students will need to research the acceptance policies of these various programs by the colleges and universities they are considering.  Each college/university sets its own policies (sometimes by college or department within the university, sometimes as an institution) regarding how these scores and credits are treated.

For some students, staying at home and taking classes online can be a less expensive path to earning a degree. There are, however, social sacrifices involved in that path that make it unsuitable for some students.  Online course completion rates are significantly lower than completion fates for in person classes.  Additionally, having the positive peer pressure to study and complete your degree is found on campuses with a 50% or higher 4-year graduation rate and  is a powerful aid to help students stay on track to graduate in four or fewer years.  Per the National Center for Education Statistics, 36% of public college students graduate in 4 years while

54 % of private college  students graduate in 4 years.

3.     Save more, Get More Bang for Your Buck

Starting earlier and saving more than the $16,000 used in the initial scenario is also helpful.  Saving takes diligent, sustained effort and, often, many sacrifices.  Every dollar saved will actually save your student $1.50; keeping this in mind can help you stay on track with your savings goals. Per CNBS and USA Today, the average amount families have saved for college (in 2018) is $18,000. This is a significant increase from 2004 when I began working with families.  It’s time to be way above average!

There are various types of accounts that can be used to save funds for college.  Some, like 529s and Coverdells, have limitations on the amount of money that can be deposited each year as well as regulations regarding the use of the funds.  Some kinds of accounts are considered assets and so are included in need-based aid calculations while others are not included.  Consequently, determining the best type of account to keep your college money in requires exploring both the tax and financial aid eligibility ramifications.

4.     Plan Ahead

Despite the high costs of college, many students arrive on campus with little to no idea what they want to study or what sort of field in which they would like to work.  As the adage goes, failing to plan is planning to fail.  Unfortunately, the vast majority of students have received absolutely no guidance regarding potential careers and majors.  Almost none have actually done a job shadow, further an internship in a field under consideration.

InsideHigherEd.com reports that, per 2017 federal data, nearly one-third of students change their majors during their first three years in college. Other studies state that as many as 80% do. Ohio State University shows data that 38% of their students changed their major between when they applied and when they completed freshman orientation.  They didn’t have data available about how many more change once they matriculate nor on how many times their students tend to change their majors.

In addition to changing majors, 25% -38% of students at 4-year colleges transfer to another college or university.  Students are much more likely to take five to eight years (or more!) to graduate when they transfer, especially those who transfer twice. 

In both cases, students often have many credits they have earned that do not fulfill their new graduation requirements.  For example, a student transferring from French into chemistry will not be able to use most of the humanities credits earned towards their graduation requirements for a BS in chemistry.

When changing majors, students typically add a year to the length of time it takes to earn their degree.  When transferring, two years additional time to degree is not uncommon. The average added out of pocket costs for one extra year of college at a public university is $62,208 ($14,940 tuition/room/board + $47,268 lost wages).  The average out of pocket costs for an extra year at a private college is $74,008 ($26,740 tuition/room/board +$47,268 lost wages).

5.     Should You Start at a Community College?

This is the path that a number of today’s parents used successfully to save a significant amount on the cost of college while still graduating in four years.  Unfortunately, in addition to having a significantly lower 6-year bachelor’s degree completion rate, getting an associate’s degree actually adds the time to degree for those who do earn a bachelor’s degree.  Approximately 25% of bachelor’s degree seeking community college students actually transfer to a 4-year college or university.  And only about 10% of those who start at community colleges have a bachelor’s degree after six years.

This path can be used successfully but it takes even more careful planning and frequent visits to the transfer counselor than the other paths to a bachelor’s degree.

6.     Get Scholarships

Scholarships are given by colleges and universities as well as private organizations.  93% of college scholarship dollars come from the schools themselves.  In fact, private scholarships impact need-based financial aid eligibility dollar for dollar so may or may not lower a given family’s out of pocket costs. (While it feels great to say that your child has received a scholarship, the actual impact on the family’s bottom line tends to be the more important factor.)

Why do colleges give students money? 

Most people are aware that scholarships are awarded for academic and athletic capabilities and accomplishments.  Some know that scholarships are also awarded by some schools for student leaders and those with special accomplishments (top debaters, for example).  Fewer are aware that scholarships are also used by some colleges and universities in exactly the same way as coupons are used, to entice you to buy their product/attend their school, rather than a competitor’s. Colleges and universities that have international reputations and tend to win large research grants tend to not give scholarships intended to entice students; they don’t need to.  Colleges that serve their region or are less well known tend to use scholarships as ways to recruit students.  Some liberal arts colleges and master’s colleges (offer bachelor’s and master’s degrees only) will give all or nearly all their students significant scholarships.  In addition, sometimes scholarships are awarded despite the fact that the family has no financial need, as an inducement to have their child attend their school, rather than another.  And, it works well! 

Lastly, a number of groups of states in the US have banded together in groups called student exchanges through which participating public universities in each state will offer students from the other states a significant tuition reduction (typically $5,000 - $10,000/year) when they attend their school.

7.     Get Help! Work with a holistic college consultant

Hiring an expert to help buy and sell a home is commonplace.  Next to a house, the next greatest expenditure is college.  Hiring an expert to assist with the process saves significant time and money, and protects people from making mistakes because "we just didn't know!"

While many college consultants only work with students to create their applications, some of us work holistically with students and their families.  For each of my clients, for example, I develop a personalized overall strategy then guide the student and his or her family through it, step by step.  I typically start by guiding students to explore possible careers then majors and schools. I evaluate the family’s financial resources then advise regarding ways to lower costs and increase resources in order to help the student accomplish his or her academic and career goals.  Working holistically, I’ve fostered my students’ personal growth and skill development, enhanced their awareness of their strengths, and guided them through the application processes, both for admissions and aid.  My clients have averaged about $75k/college in scholarships, plus need based aid.  While I work with clients from all education settings and backgrounds, I specialize in working with home educated students and Catholic students.

Lowering the family’s stress levels, providing expert knowledge, and seasoned guidance provides an improved quality of life as well as better academic and financial outcomes for my clients.

Evaluate your options and find a better way to get your degree.  College shouldn’t be a debt sentence.

If you’d like to meet with Katherine, you may schedule a consultation at CelticCollegeConsultants.FullSlate.com
 

What is Admissions looking for? An Overview of High School Should You Homeschool High School?

Part 1 of 4

In this series of articles I will address a number of factors of high school education from a college admissions perspective.  As a Catholic homeschooling mother of six and a professional college consultant, I will share some of my experience and knowledge in this series of four articles.  In this first article, I’ll discuss the overall perspective colleges have with regard to homeschoolers and I’ll explore the various tests that are often part of the high school experience.  In the second article, I’ll examine the various types of courses high school students can take.  Next, athletics, extracurricular activities, and leadership will be the focus of the article.  In the final article, financial aid, scholarships, and college funding topics will be addressed.

My goal is to educate families through these articles so that you can prayerfully make the best decision for your children.  Each child and family is different.  Out of respect for that, I seek to provide information, not to persuade you to a particular action when I do not know your situation.

Not Sure Whether Your Student(s) Is/Are College Bound?

What if you aren’t sure that college will be the appropriate path after high school for your child(ren)?  At this stage, it is important to both keep the various higher education options open as well as foster the emerging interests and inclinations of our children.  If you aren’t certain, proceed in a manner that leaves college as an option.  However, if it is already clear that a different path will best serve your child(ren), skip the academically focused sections of this series and focus your attention on the other sections. Explore the certificate and apprenticeship programs available in your area and in your child(ren)’s area(s) of interest.  The Occupation Outlook Handbook found on the Bureau of Labor Statistics website, bls.gov, will be helpful when researching any prospective careers’ expected growth and pay ranges.

Homeschooled students are welcome on campus!

Before going any further, it’s important to make it clear that homeschooled students are welcome on college campuses.  Many admissions offices have special instructions and/or admissions counselors just for homeschooled students.  On campus, homeschooled students fit in just as well as, if not better than, students schooled in other situations.  Academically, as long as they have learned to turn in their work on time during high school, homeschooled students tend to flourish.

If his or her high school transcript will be unaccredited, there are a few schools that won’t accept the student.  Most notably, the UC system is considered closed to homeschooled students.  Officially the University of California colleges accept homeschoolers, but it is quite challenging to meet all their requirements.  For full information about those requirements, please see the homeschool portion of their admissions website:

http://admission.universityofcalifornia.edu/freshman/homeschool/index.html.

While special admissions requirements for homeschooled applicants are somewhat common, the more selective the college is, the more likely it is that there will be special requirements and that they may be significant and/or take time and planning to meet.  The most common requirement is for homeschooled students to submit subject test scores to validate their coursework.  Most often SAT subject tests are requested although it is often possible to use CLEP or AP test scores instead.  The advantage of CLEP and AP scores is that many colleges and universities will give college credit and/or waive course requirements for students with high scores on these tests.  Each college has its own policy regarding whether and how they accept scores in lieu of required courses.  Some give no credit while others give elective credits and still others will waive required courses, accepting the scores instead.

Testing 

Test scores typically form a significant part of college applications for all students.  For homeschoolers, as mentioned, tests are often used to validate the student’s grades.  There are many tests, all of which have different goals and are available on different bases to homeschooled students.  Keep in mind that there are currently approximately 1,000 colleges and universities that are “test optional” or “test flexible” for admissions.  FairTest.org has information about them.  However, be aware that most test optional schools still require test scores to qualify for their academic merit scholarships.

75-80% of colleges and universities require applicants to take the SAT or ACT and submit their scores as part of the application process.  Be aware that both the College Board and the ACT sell student information to colleges (if you look closely there is an option to opt-out on their registration form).  Be sure to have your student use a different email address, not their usual one, when s/he registers for the tests.  That way the flood of marketing emails will not overwhelm their primary email account.

ACT Aspire – This test is a “standards based system of assessments to monitor progress toward college and career readiness from grade 3 through early high school.  Based on the information on the DiscoverACTAspire.org website, this test seems to be geared to give educators feedback about this students.  As such, it is not applicable to homeschooling families.  This test will not be part of any student’s college admissions application.

ACT Tessera – This test is offered by the ACT organization to measure social and emotional learning skills of 6^th – 12^th grade students.  Each student will receive a personal proficiency and growth report and be encouraged to set goals and identify strategies for improvement.  Having a child with Asperger’s compelled me to include a note on this test.  This test will also not be part of any student’s college admissions application.

PSAT 8/9 – This preliminary SAT test is given to 8^th and 9^th grade students. The score is on the same scale as the SAT and a national ranking is provided.  Score information can be used to create a high school course plan.  Primarily, the test gives an additional opportunity to take an official, proctored national exam.  This test score is not used as part of the college admissions process.

PSAT10 – The Preliminary SAT test is given to sophomores and usually provides the first nationally ranked test score students see. The PSAT score report also provides the student’s equivalent SAT score, which is very helpful information to have when exploring the academic fit of various prospective colleges.   This test score is not used as part of the college admissions process.  Many find it helpful to have a nationalized test score early in their college search as well as to have the opportunity to take an official, proctored test before taking the SAT, ACT, or CLT.

The PSAT is Common Core correlated and includes an English and a math section.  This test is only given to the students of brick and mortar high schools.  Contact your local schools’ testing coordinator in August of sophomore year to arrange for your student to take the test on their campus.  Public schools are often welcoming but are not required to allow homeschooled students onto the campus.  If they do not welcome you, contact private high schools in your area.  The test is typically given in mid-October.  Recently, some schools have begun to offer the PSAT10 during the spring instead.  Consult your local schools directly to obtain their testing schedule.

PSAT/NMSQT – The Preliminary SAT test given in October of the junior year and is the National Merit Scholarship qualifying test.  The only way to win a national merit scholarship is to score in the top 10% of the juniors who took the PSAT/NMSQT in your state.  Those students are semi-finalists and will be contacted by the National Merit Corporation and asked to submit a high SAT score and a transcript as part of the scholarship qualification process. The PSAT is Common Core correlated and includes an English and a math section.  It is only given at brick and mortar high schools.  Contact your local schools in August of junior year to arrange for your student to take the test on their campus in October.  Public schools are often welcoming but are not required to allow homeschooled students onto the campus.  If they do not welcome you, contact local private high schools in your area. 

Pre-ACT - The Pre-ACT is given to sophomores and provides a practice ACT experience and score as well as information on students’ college and career readiness.  The score report also provides the student’s equivalent ACT score, which is very helpful when exploring the academic fit of various prospective colleges.   The test is Common Core correlated and includes English, math, science, and reading sections. Like the PSAT, the Pre-ACT is only given at brick and mortar high schools.  Contact your local school’s test coordinator in August of sophomore year to arrange for your student to take the test on their campus.  Public schools are often welcoming but are not required to allow homeschooled students onto the campus.  If they do not welcome you, contact private high schools in your area.

SAT – Homeschooled students register for the SAT just like all other students, by going to the CollegeBoard.org website and registering.  Testers can select the test site (you can even take it far from home if you’re traveling!)  There is a special high school code for homeschoolers.  If you homeschool through a program that gives an accredited diploma check with your school; it might have a high school code.  The SAT may be taken with or without the essay.  Check the admissions requirements of your student’s prospective schools regarding whether or not the essay is required.  If so, be aware that admissions staff will be able to read students’ SAT essays.

ACT - Homeschooled students register for the ACT just like all other students, by going to the ACT.org website and registering.  Testers can select the test site (you can even take it far from home if you’re traveling!)  There is a special high school code for homeschoolers.  If you homeschool through a program that gives an accredited diploma check with your school; it might have a high school code.  The ACT may be taken with or without the essay.  Check the admissions requirements of your student’s prospective schools regarding whether or not the essay is required.  If so, be aware that admissions staff will be able to read students’ essays.

CLT – The Classic Learning Test was developed in recent years and is accepted by more than 100 colleges and universities in lieu of the SAT or ACT.  For full information on this test, which is offered at sites all over the US, please see CLTExam.com.  Many homeschooling families using a Christian and/or Classical curriculum find the CLT, which is not Common Core correlated, to be a more appropriate test.  The CLT includes an English and a math section.  Check their website frequently as the list of colleges accepting the CLT is increasing steadily.  If you are interested in the test and in a college that does not yet accept it, do not hesitate to call the admissions office and suggest they start to accept it.  Contact the CLT team as well; they might be able to assist you with getting the test accepted by that/those college(s).

AP exams are given in physical high schools every May.  Students are NOT required to take AP courses in order to take the exams.  AP exams are offered in many subjects and may be taken during any year of high school.  It is possible to take several AP exams during the same year. See the CollegeBoard.org website for a complete list.  Contact your local school in January to arrange for your student(s) to take the test with their students in May.  Be aware that not every school offers every AP test.  Just as is the case for the PSAT and Pre-ACT, homeschooled students must get permission of the testing coordinator in order to join the students on campus for the AP exams.  The fee for AP exams is handled by the high schools.

IB exams - The IB/International Baccalaureate program is a robust program consisting of six courses taken in the junior and senior years of high school, each ending in a test.  At this time, these are only available through institutional schools.  They are highly regarded by colleges and universities, including the most selective campuses.

SAT Subject exams – Some colleges and universities recommend or require these tests for admissions.  “Recommend” means the test is not absolutely required.  However, it is expected that all successful applicants will take them, unless there are geographical or financial constraints that prohibit the student from doing so.  A list of the subjects and the dates each test is offered may be found on the CollegeBoard.org website.  Homeschooled students register for SAT subject tests just like all other students, by going to the CollegeBoard.org website and registering.  Up to three SAT subject tests can be taken on most test dates.  The SAT and SAT subject tests cannot be taken on the same day. Testers can select the test site (you can even take it far from home if you’re traveling!)  There is a special high school code for homeschoolers.  If you homeschool through a program that gives an accredited diploma check with your school; it might have a high school code.

CLEP tests – Homeschooled students can take CLEP exams any month at sites all over the country.  See the CollegeBoard.org site for a complete list of the subjects tests as well as to find test sites in your area.  Testers make arrangements with the local test site to take the tests.  The website also has a list of the colleges and universities that accept CLEP scores.  Families will need to make arrangements with the test site directly to schedule and pay for CLEP exams.  Students may take more than one exam at a time, if they wish.

DSST tests – Homeschooled students can take DSST exams in a wide variety of subjects (including business math and criminal justice, for example). These college equivalency exams are offered at test sites all over the country and are designed to give college credit for job training,etc.  A complete list can be found on the getcollegecredit.com website.  A list of institutions which accept these scores is also available on the website.  Testers register on the DSST website as well.

More to Come…

In the next installments, I will address financial aid, scholarships, athletics, high school courses, transcripts, AP courses, dual enrollment, leadership, & extracurricular activities.

Katherine O’Brien, MA CCPS is a Catholic homeschooling mother of six who has homeschooled since 1998.  She is the founder of Celtic College Consultants and has served college bound teens all across the US since 2004.  Students in her recent classes were offered over $225,000 each, on average, in merit scholarships. In 2017, Katherine compiled and released Every Catholic’s Guide to College: The 315 Best US Colleges & Universities for Practicing Catholics, 2018.  It is available on Amazon.com.