The 4 Rules of Paying for College in a Recession

Although I’ve been writing for years about financing college, I’ve never before received so many letters like this one from Philip I., who is a mortgage consultant in New England: “I am panicked. My son is a junior in high school. Any ideas would be helpful.” Many parents are reeling from big financial losses at the same time they are shocked by college price tags, confused by all the nitpicky rules, and scared that they’ll ruin their children’s future if they can’t figure out some way to get them through college.

Luckily, we’ve put together advice from financial aid experts—including lots of parents who managed to pay tuition without going bankrupt. A basic primer to financial aid can be found here. (MORE)

4 Ways to Find Cheap Student Loans

By Kim Clark, US News and World Report

Posted April 30, 2009

The Wall Street collapse and the national recession have wiped out those cheap and easy $40,000 student loans that were advertised on late-night TV last year and have raised the real costs of many remaining education loans But the financial storms also have created a couple of surprising silver linings. Most students can still get enough reasonably priced loans to cover the bulk of tuition at local public universities. And some students and parents actually will get better deals than ever before. The government is cutting interest rates on the loans it makes to the neediest students, and lucky parents who still have good credit and lots of home equity are able to pull college cash out of their homes at record-low interest rates. What’s more, a growing number of colleges are trying to fill the loan vacuum by offering students comparatively low-cost supplemental loans. (MORE)

College Graduates Struggle To Repay Loans

November 23, 2009 (NPR)

November brings a nerve-racking deadline for May’s college graduates: It’s time to make the first payment on their student loans.

With this year’s tough job market, many graduates don’t know how they’ll come up with the money. Many are asking for deferments, and some may have to default.

But a new federal law designed to ease the pain of repayment may help some make it through this tough time. (MORE)

The Americorps Experience

Stephen Merrill updates us on his somewhat random thoughts concerning science, video games and college access:

Video Games = Education!

 So I was reading an article today that got me thinking about the elementary or middle school science fair.  You may have a vivid image in your mind right now of the hand painted sign hanging crooked above the doorway to the school gymnasium “Science Fair” or if your school was really lucky your sign said “District Science Fair” and your entries would be judged by a celebrity panel that included the Chief of Staff from the suburban Mayor’s office and the weekend meteorologist for the 2^nd ranked local newscast.  I was in the science fair several times, I never did the volcano of baking soda and vinegar; I thought it was light on substance but had great visual appeal (http://www.activitytv.com/138-erupting-volcano).  My last attempt I did a project observing the effects of electromagnetic fields on the growing patterns of beans.  I thought this project could have had serious implications for agricultural planning and should have been seen as significant, but the celebrity panel said “meh” and promptly awarded first place to a friend of mine that did a study of genetic characteristics in rats, though the rats died unexplainably during observation.  I entered the science fair almost every year between 3^rd and 8^th grade, doing other studies of bacteria and video games.  The video game study was my favorite, maybe that was because I had an excuse to play video games and have friends over to play video games for more than an hour a day.  In that study I attempted to measure heartrate and find a direct correlation to a persons stress level and playing video games.  I had a few holes in my hypothesis, I also didn’t account for people being nervous under observation and getting worked up due to frustration experienced when you constantly fall off a cliff trying to jump to the next platform in Sonic the Hedgehog 2.  Anyways, it was the headline of “Obama touts TV and video games as teachers of math and science skills” (http://chronicle.com/article/Obama-Touts-TVVideo-Games/49247/) that caught my attention, the fact that Sesame Street and Discovery Channel are major players in this new effort really shows the blending of entertainment and education.  Whether it will effectively expand the science and mathematics fields beyond its current audience is debatable, but it will definitely give kids a new excuse to wheedle an extra hour of video gaming from their folks.  Now, if I were to design a video game and make it relevant to the college process I would take a game like NCAA Football and make the college element realistic.  The characters would have to study real subjects to earn a degree, not fake courses like famous college mascots.  No, they would at least study economics, and business management.  At the end of each season, they would have to pass a financial literacy course and fill out the FAFSA.  I would build real college tools into the game; otherwise just make it a football game, pass, tackle, run, score!

 -S

Obama will give you $2,500 a year to go to school

By now, everyone knows that the Obama administration’s stimulus bill is designed to get the economy moving again. However, you may not know that most of the bill’s $70 billion for education will go to low- to middle-income individuals.

A major part of the bill is a $13.8 billion tuition tax credit boost called the American Opportunity Tax Credit. This tax credit reimburses 100 percent of the first $2,000 of educational expenses for lower income students. For the next $2,000, students will receive a 25 percent reimbursement. In short, lower income students will receive $2,500 in education reimbursements per year. (MORE)

Change in financial forms aids independent students

When Kevin Robinson entered Colorado State University he couldn’t get his parents to fill out a student financial aid form, so he used a credit card to pay his $8,000 bill.

Robinson and his parents had split over lifestyle issues, but as far as CSU was concerned, that didn’t make him independent.

It left Robinson in limbo when it came to the Free Application for Federal Student Aid or FAFSA program.

“I really thought I might have to drop out of school and just work,” said Robinson, 23, who is now in his senior year.

This year, for the first time, the federal aid program will allow approved students to submit a form without their parents and receive some aid. (MORE)

An Education in Student Loans

College degrees are supposed to last a lifetime, but should tuition loan payments? How some schools got away with charging interest rates of up to 18 percent.

Graduation day should have been a happy one for Tyrone Bailey. The first in his family of three children to earn anything beyond a high-school diploma, Bailey, 24, received a bachelor’s in criminal studies from Westwood College in Torrance, Calif., two years ago. But even while the day’s pomp and circumstance played out, his thoughts turned quickly to the tough job market and the $20,000 in loans he borrowed directly from his alma mater that were set to accrue a whopping 18 percent interest rate. (MORE)

The College Freshman Experience

Jennifer compares her experiences at CSU to what she saw during a visit to OSU and discovers that she chose the right school:

Throughout my first year of college I have had two different types of college experiences. During my experiences I have seen that CSU is the right place for me. When I went to visit OSU and stay in the dorms with my best friend Connie, I realized that, that kind of life style is not for me. At CSU I go to class and then go home. I’m not saying that I just want to spend all four years of college just going to school and going home, but it is a nice thing to do. When I was at OSU I experienced the dorm side of college, and I can’t say I like it. There is no privacy, and you have a roommate that you might not like. She was on a floor of all girls, and many of them were party girls that go out and drink to get drunk. That is just not the type of life style I want to be surrounded by, it never has been. I have been surrounded by that life style for my entire life and I don’t want to spend four years of my life still being surrounded by a party life environment. At CSU I can go home whenever I want, it’s not a school that is two and a half hours away, it’s only ten minutes away. At OSU I witnessed a Halloween weekend with a bunch of college kids, most under age walking stumbling down High Street drunk, and that’s just not what I want. I saw some of my close friends from high school, some that always did better then me academically and they are wasting their time at college being so drunk that they are struggling in their classes. In my sister’s first year of college she spent all of her time hanging out with friends and going to parties, she ended up on academic probation and losing all of her scholarships and dropping out of college. That person is not going to be me, because I made my choices right. I am going to CSU, not a party school, but a school that I can receive a good education at and maybe someday make a few good friends.

Can you relate?

10 Secrets to Raising More Than $15,000 for College

By Kim Clark

US News & World Report

Posted November 12, 2009

Grandparents are pitching in. Students are working more, and eating less. Parents are taking out more and bigger federal loans.

As the economy has declined and college costs have risen, families have buckled down and become more resourceful to pay for college.

They have been so successful at funding tuition that college enrollment is up dramatically. A record 40 percent (or 11.5 million) of 18- to 24-year-olds are taking at least one college course this year. Add in all the adults returning to school because of the lousy job market, and the total number of college students is likely to exceed 19 million this year.

How are more students affording tuition even though many colleges’ prices are at record highs and many scholarship programs, private lenders, and family savings accounts have been wiped out? (MORE)

Do Early Decision Students Get More Financial Aid?

For high school seniors, the early decision game has always represented a calculated risk. Apply early, and you might increase your odds of getting in. But if you apply to any school other than your top choice and are accepted, then you’ve locked yourself out of your dream school.

For students applying for financial aid, the stakes are higher. Because of the timing of aid decisions, students who apply under early decision programs and are accepted could have a better shot at scoring more financial aid. (MORE)