5 college expenses you should budget for
The number of adults going back to college to obtain higher education amid the coronavirus pandemic decreased in 2020 as many people faced unemployment, salary reductions and a lack of childcare options. The number of people enrolled at community colleges declined almost by 10% in 2020, according to the National Student Clearinghouse Research Center.
During previous economic downturns, many people went back to college to obtain another degree. Community colleges reported higher enrollment from 2006 to 2011, the period that includes the Great Recession of 2008. Two-year college enrollment at community colleges rose by 33% nationally, based on a 2018 U.S. Census report.
If you're a college student and want to crunch the numbers before taking out a student loan or picking a college, consider using multi-lender marketplace Credible to compare rates and lenders in one spot. You can also use their online student loan calculator to determine costs.
5 college expenses to budget for
When it comes to going to school, money matters. Saving for college isn't easy, especially if you consider costs beyond tuition itself. Before people go back to obtain a bachelor’s or master's degree, here are the five costs of getting a degree that should be considered.
- Textbooks and technology
- Child care
- Loss of income
The costs of higher education continue to increase, adding to the amount of debt people are facing. There are now 45 million people who owe $1.6 trillion in student loans.
Before you decide to take out a loan that could take years to pay off, shop around for student loans or other options. If you don't qualify for a federal student loan, consider browsing private student loan options via Credible.
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Completing a Free Application for Federal Student Aid (FAFSA) application is one of the most important steps that students can take to make college more affordable and receive financial aid, grants, and work-study opportunities, said Leslie Tayne, a Melville, N.Y. attorney specializing in debt relief.
"Even those that believe they won’t qualify for financial aid should still complete an application," she said. "Financial aid is available for those with a household income of less than $250,000, so most students likely qualify for some form of aid."
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2. Textbooks and technology
Textbooks can be costly on top of paying for a tablet or laptop and other software needed to complete a degree. Access codes and online courses have replaced textbooks and it isn't always an option to buy used books or borrow a copy from the school’s library.
"Course access codes and e-textbooks are costly in most cases, but there are thankfully lower-cost alternatives for many students to consider," Tayne said.
Depending on the textbook publisher, subscription services now exist that cover the cost of multiple course materials over a semester.
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3. Child care
Students with children can research the U.S. Department of Health & Human Services website under the Office of Child Care to find resources in their state. Many provide grants to students so they can afford childcare while attending class.
A large number of colleges and universities offer on-campus childcare. Child Care Aware program can also help parents find affordable childcare in their area, Tayne said. Another option is private scholarships such as the Soroptimist’s Live Your Dream Award that provides mothers with up to $16,000 to help cover education and childcare costs, she added.
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4. Loss of income
Obtaining a graduate degree can negatively affect finances if a proper budget isn’t in place, Tayne said.
Work-study or employer education programs can help lower the financial burden going back to school as an adult can place on finances. Some employers will reimburse employees for tuition or help them pay a small portion of their student loans each year.
"While employed, attending part-time can be more expensive in the long run versus attending as a full-time student, but the lower cost per semester can help boost cash flow and short-term affordability," she said.
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While living on campus or near the university is convenient and desirable, it is typically very expensive. In many areas, living off-campus generally is much more affordable, especially if you find roommates. Make sure you take into account living expenses when determining which college to attend (as some cities are costlier than others).
"Room and board can often cost more than tuition itself, so students should always make sure they compare their housing options," Tayne said. "Meal planning is typically easier to do when living off-campus as well, as many dorms don’t offer private kitchens. Students that bring meals with them instead of opting for dining halls can save a lot, too!"
Start the process by filling out the FAFSA, applying for scholarships and grants and other financial aid. Interest rates are at historic lows — shopping around for loans can help you find the best rates and terms that fit your situation. Compare private student loan lenders via Credible.