Not surprisingly, paying for college is a source of real anxiety. It’s actually the leading cause of financial stress among parents, according to results of the financial advisor survey recently released by Allianz Tuition Insurance.
While scholarships, grants and student loans help parents pay, a significant amount is covered by parent savings and income.
According to Sallie Mae’s annual survey How America Pays for College, families with a student at a four-year private college spend an average of $41,762 a year on tuition and fees (not including housing and meals.) The comparable cost at a four-year public institution is more than $23,000. On average, nearly 30% of the cost is covered by parent savings and income.
What can a family do to reduce the stress college expenses bring?
Here are some suggested strategies to help families reduce the bite college takes out of their budgets:
1. Consider choosing a school close to home.
Choosing a school nearby can help save lots of money on room and board. This is one of the most expensive aspects of pursuing a college education. Not only will you avoid living expenses but you can also save on food and laundry.
2. Choose a walkable campus.
The price of keeping a car on campus can add up quickly. An on-campus parking permit can reach hundreds of dollars a month, and don’t forget car insurance payments. Sometimes, student parking lots are still a hike away from class buildings and if you choose to park closer it’s likely you’ll need quarters for a parking meter. You also run the risk of an unexpected parking ticket.
3. Start your college career at a less-expensive community college.
Deciding to stay home for the first year might be a difficult decision at first but it can potentially save thousands of dollars on tuition. Consider taking your general education requirements at a less expensive institution, then transfer to a four-year college or university to complete your degree. Just make sure and work with a counselor to guarantee the credits you earn will transfer successfully.
4. Protect your tuition investment with tuition insurance.
It’s becoming more common that students take longer than four years to graduate, it’s also more common that they leave school in the middle of a semester due to unforeseen illness, injury or mental health issues. Tuition insurance guarantees that you don’t lose your tuition if you need to unexpectedly withdraw post your institution’s refund date.
5. Select a program or course of study that can completed faster.
A four-year degree program isn’t for everybody. Consider earning your associate degree or a completing a certificate program for the skilled trades through a community college. There are lots of education options out there that are worth exploring.
No matter how well you economize, higher education is still one of the biggest investments your family will ever make. It’s certainly one of the most important. So what happens if something comes up that keeps your student from being able to complete the semester?
Most colleges and universities offer only a partial refund after a certain point in the semester. Each institution’s refund policy is slightly different and it’s important to make sure you understand it when you are enrolling in courses.
Without a refund (or even with a prorated refund) many families say it would be very difficult or even impossible to pay for an additional semester, according to College Parents of America.
That’s why parents are considering the benefits of tuition insurance. With affordable tuition insurance plans that offer up to 100 percent reimbursement of tuition and fees paid for a range of covered reasons, it’s how to protect the dream you’ve worked a lifetime to build.
You may not be able to control the cost of college, but you can make sure you’re protecting the important investment you’ve made. It all comes down to knowing the small ways in which you can save.