College Savings Help

[luckey-lasvegas]

My DD will be a freshman in high school next year. We have a been paying into the states prepaid tuition plan since she was a baby so her tuition money is pretty set. We had thought that she would be able to get the states Millenium scholarship which would help pay for housig costs, but now that the state is nearly bankrupt it probably wont be there. We are looking to save for her housing costs over the next 4 years but I wanted to ask the "experts" my budgetboard family, what may be the best route to take. DH owns his own business and I make the majority of my income from tips, so the amounts that we are able to put away may vary but at least $100 a month for a start. Any suggestions??

 

[mtblujeans]

At my 2 sons college, if they volunteer to be the dorm RA (Resident Adviser) they get their dorm housing for free. But the kids tell me it is a stressful 'job'. They usually pull an "all nighter" once a week, keeping the kids in the dorm in-line. They also have to check each room for damage at the end of each semester, as the kids all check out of their dorm rooms (4 kids per room throughout the building). Lots of responsibility and sounds like they need to have ALOT of patience, people-skills, and organizational skills to keep up with their own schooling. HTH.

 

[Pigeon]

I work in a public university system. The room and board is significantly more than the tuition. It is generally much cheaper for kids to live off campus. Clearly that varies with the institution, and some places require freshmen to live on campus. But it is something to consider.

There are, of course, trade-offs, and living off campus and doing well in school requires a certain maturity that not all freshman have. I wouldn't want my kids to do it, but I see many kids who do and are fine with it.

 

[csharpwv]

I am a college Admissions Counselor - I usually work with parents of seniors, and they are asking the same or similar questions...... a little too late!

Kudos to you for thinking of where your DD will live while she is in college - a few years in advance, while you still have time to ACTUALLY save money!

So, you want to save money for housing (room & board) - let me give you a few suggestions!

SCHOLARSHIPS! Believe it or not, in no way shape or form is it too early to start thinking about applying for scholarships - even as an underclassmen!
There are scholarships out there that are awarded to underclassmen - usually based on career shadowing experiences, community service, academic performance, and a ton of other variables. Be sure to register on fastwest, free 4 U, and other similar websites.

A few words of warning - DO NOT PAY FOR A SCHOLARSHIP SEARCH WEBSITE! The free ones have the same exact scholarships as the pay websites do. Don't be fooled by 'HUGE' awards - or 'Free rides' - 99.999% of 'free ride' scholarships are awarded based on academic merit - to seniors only. There are a few underclassmen awards out there that cover the vast majority of costs, but they are few and far between and are usually very targets for very specific populations.

The PP mentioned being a Residence Aid - the University I work for does the same arrangement for residence life staff. These opportunities are open only to upperclassmen. The positions are filled through a pretty intense interview process, because it does take a very specific personality to take on a leadership in a residence hall.

Next - birthdays - holidays and other times when gifts are given make a great opportunity to provide 'matching funds'. If she receives a gift of $20.00 - offer to match it 100% if she puts it in her college savings account. $20 turns into $40. It is a great way for a student to take ownership of their future college expenses.

A big one here - SHOP AROUND! Don't just look at tuition costs when thinking about colleges - look at room & board costs as well. Be realistic when it comes to costs, but DO NOT allow your family to be taken advantage of.

College costs across the country are soaring - and don't allow your home state's budget crisis become your family's budget crisis.

You would be surprised at how quickly the idea that 'out of state' means 'out of budget' is being dissolved.

I am traveling across the country to CA to recruit college students due to that state's budget crisis that has pushed their in-state colleges raise tuition, leaving students to saddle the debt of a state's education budget cuts.

The average "B" student is going to pay just over $16,000 a year at the University I work for - and that cost includes tuition, fees, room & board - for an out of state student.

ALWAYS remember - and NEVER forget that a high price tag DOES NOT equal a better or higher quality education. Why a student would pay almost a 1/2 million dollars for an undergraduate education is beyond me.

The best approach that students are taking these days is to go to an inexpensive - higher quality - institution for their undergraduate degree - and save money to go to graduate school.

A Bachelors degree doesn't go as far as it used to - and more importantly, be sure your DD is realistic about the starting salary in her chosen profession when considering where to go to college.

When I see a student paying $50,000+ a year to earn a BA in Education, I want to show them job postings that include the starting salary for teachers. Hopefully - the shock would wear off quickly, and the student would hopefully pursue a different institution.

But - after all of that, I'm a little off topic!

Anyway - back to the topic at hand - saving - the biggest thing to remember when saving is this - SET A GOAL.

I always tell students, an illusive goal will never be reached.

Set a goal - $1,200 a year should be your minimum - that's $100 a month - and over the next 4 years that would be $4,800 - and believe it or not, that doesn't even being to cover the cost of room and board for one year at every institution that I know of.

So - shop around right now, see what the average cost of Room & Board is right now - and set your goal based on that figure. To cover the basic costs out of pocket in 4 years - you are going to need to save a minimum of around $500+ a month for the next four years. ($24,000 over 4 years)

Finally - don't forget that every student qualifies for $5,500 in student loans their freshman year, and a little more every year after that. That total is $22,000 minimum over 4 years. No one likes to be in debt - but in all reality - that isn't a terrible amount to owe at the end of 4 years.

Here is an idea - make a poster of a balance scale or similar - for every dollar saved - that's one less dollar that your DD will have to borrow.

Also - don't forget about scholarships - they are out there - even for underclassmen!

 

[arthur06]

I wasn't as fortunate as you when it comes to parental planning for college. (they did nothing).

I knew that if I wanted to go to college it would be on my tab, like so many others! I lived close to a community college. So, I got my AA degree there with no student loans. Then I moved away to an out of state college and got student loans. I worked all my years of college, and my last year and a half (it took me 5 years for the 4 year degree) I worked full time and took mostly night classes. I graduated with only $14,000 in student loan debt!

There might be a point where your daughter has to cover some of the cost herself. It is awesome that you do all that you do! Kudos to you and your DH!

 

[MrsPete]

First, having tuition saved is not bad -- it's more than a whole lot of kids have. With that in place and four years to save, you may not save the whole amount, but you're not in serious trouble. Remember, too, you'll still be working while she's in college. You don't have to save the whole thing in an account before she earns her high school diploma.

Another poster mentioned being an RA. I was an RA 20 years ago in college, and it was absolutely a financial life-saver for me. It gave me a private room for free, half my meal plan paid, and half my in-state tuition paid. Oh, and my phone was paid. The cherry on top of the cake: I never received a penny in actual money, so I didn't pay taxes on it. For a kid with NO financial support it was great. It was a great deal of work the first two weeks of school and the last two weeks of school, but in between it wasn't bad at all. I was "on call" an awful lot of time, but that just meant I had to be on my floor -- I wasn't required to do a whole lot most of the time. The negative: Lots of people want these jobs, and getting one is tough; when I applied, getting in was a lengthy process: First a paper application, then a role-play type interview, and finally a personal interview (with people being cut at each stage). Also, you have to be at least a sophomore to apply, which makes perfect sense. I'm encouraging my daughter to consider this option.

I disagree with the poster who says you can live off-campus cheaper. When you compare TOTAL COSTS, a dorm room is less expensive. Remember that if you get an off-campus apartment, you're going to have to pay for it year-round, even if your student doesn't take summer classes. Utilities, cable and internet, and furnishings all add to the cost.

Also, when you're talking about freshmen, a dorm gives some security and some support. In a dorm, there'll be someone to check IDs after 6:00 or so. And there'll be more people to notice if your student isn't eating, isn't making friends, etc. I've always thought that a dorm is a must-do for a freshman, but my husband (who never lived on campus) disagreed. After touring a dorm recently, he decided he agreed with me -- it was the security that convinced him.

On the other hand, I think meal plans at the schools we've visited are pretty expensive. And depending upon the dorm, suite, whatever in which your student lives, a meal plan may be required. But to compare to apartment costs . . . the student who'd cook good healthy meals might come out saving money on food; the student who'd grab fast-food twice a day would end up spending just as much AND would pay in health costs as well. Just be sure you're realistic in your comparisons. Sure, it's easy enough to say that you CAN make a meal of a $1 frozen pot pie, but no one's actually going to do that on a regular basis.

The on-or-off-campus choice will likely come down to non-financial choices. I suspect my daughter, who plans to major in nursing, will choose to go off-campus when she's a junior/senior. At that point, she'll be off campus just about all day, and paying for a meal plan may well be beyond reasonable. On the other hand, if my younger child sticks to her architecture plans, she's likely to want to stay on campus because it'll be more convenient for her to use the late-night on-campus facilities.

I totally agree with the poster who says that you SHOULD consider costs when making a college choice. For years we as a society have accepted that the dream school is worth ANY PRICE, and I think people are coming around now to the idea that although education is well worth the cost and effort, price matters. So look into lots of choices -- including the possibility of community college or living at home. They may not be the student's first choice, but she also won't enjoy the sacrafices of paying back loans.

While you're talking about housing, don't forget books. A friend of mine's son just spent $900 on one semester's books. I was shocked. My own daughter's currently in love with two schools, and one of the reasons I prefer one over the other is that it RENTS textbooks to students. They pay a $105/semester fee and don't have to buy books.

Again, with tuition saved, I don't think you're in big trouble.

 

[jsmith]

I disagree with the poster who says you can live off-campus cheaper. When you compare TOTAL COSTS, a dorm room is less expensive. Remember that if you get an off-campus apartment, you're going to have to pay for it year-round, even if your student doesn't take summer classes. Utilities, cable and internet, and furnishings all add to the cost.

Absolutely NOT true in Boulder, Colorado. Ive had two kids go thru there-and room and board on campus is obscenely expensive. A shared house or appartment is definately cheaper-even paid for year round, with grocery costs, cable tv , internet and other expenses. Even now my youngest who is finishing a concurrent BS/MS program in December is paying for an appartment alone in the Northwest Denver suburb of Westminster -all his costs and a bus pass are less than the cost of one semester in Graduate student housing. As others have said-take the cost of room and board into consideration-as well as university policy-most require freshmen to live on campus unless they have a waiver to live at home. That effectively removes the option of looking for cheaper housing off campus.

 

[MrsPete]

Absolutely NOT true in Boulder, Colorado. Ive had two kids go thru there-and room and board on campus is obscenely expensive. A shared house or appartment is definately cheaper-even paid for year round, with grocery costs, cable tv , internet and other expenses. Even now my youngest who is finishing a concurrent BS/MS program in December is paying for an appartment alone in the Northwest Denver suburb of Westminster -all his costs and a bus pass are less than the cost of one semester in Graduate student housing. As others have said-take the cost of room and board into consideration-as well as university policy-most require freshmen to live on campus unless they have a waiver to live at home. That effectively removes the option of looking for cheaper housing off campus.

Absolutely true in North Carolina.

To give a concrete example, my daughter's #1 choice school charges $1900/semester for a dorm room. To MATCH that price, you'd have to find an apartment that'd cost $400/month . . . in a resort town . . . and don't forget deposits, utilities, cable and internet. Bring in furniture, washer and dryer. And don't forget that you're going to have to pay for that apartment all summer long, even if you'd really rather have the student come home.

Her second-choice school is a little more at $2200/semester for a dorm room. But it's in a beach town, so apartments are even more expensive in that area.

 

[Pigeon]

Absolutely true in North Carolina.

To give a concrete example, my daughter's #1 choice school charges $1900/semester for a dorm room. To MATCH that price, you'd have to find an apartment that'd cost $400/month . . . in a resort town . . . and don't forget deposits, utilities, cable and internet. Bring in furniture, washer and dryer. And don't forget that you're going to have to pay for that apartment all summer long, even if you'd really rather have the student come home.

Her second-choice school is a little more at $2200/semester for a dorm room. But it's in a beach town, so apartments are even more expensive in that area.

That's why I said you have to evaluate the situation every institution. The average room and board in the system where I work is $5,200 per semester for a miniscule double. There are some nicer, apartment stye dorms, but they are more expensive and students have to lease them year-round, not by the semester.

The typical off campus apartments that students rent are fairly inexpensive.

 

[crisi]

That's why I said you have to evaluate the situation every institution. The average room and board in the system where I work is $5,200 per semester for a miniscule double. There are some nicer, apartment stye dorms, but they are more expensive and students have to lease them year-round, not by the semester.

The typical off campus apartments that students rent are fairly inexpensive.

Its also important to look at other things than rent cost - you have to evaluate the kid as well as the institution and the finances. A year of dorm life makes a nice transition between "mom is there to do my laundry, grocery shopping, feed me, pick up after me, pay for things, and help me arrange my life" to "I'm on my own." If your kid is really independent and capable of doing all that "life stuff" - going straight to an apartment and spending four years living off campus might make a lot of sense - financially and otherwise. If your kid is still figuring out how to not turn all his underwear pink, has spent his allowance or paycheck two days after it arrives, and hasn't figured out cooking that is more challenging than a frozen pizza - a year - or four - in the dorms might be a good investment in college success - and might turn out to be cheaper than cleaning up after the learning experience. He'll still have to do his own laundry - but at least you know he sees vegetables.

Dorms also provide a built in social club for transition. Dorms will arrange "get to know you" events, your neighbors all generally all Freshman like you who know nothing. The people I know who went straight to apartments or lived offsite, including myself (the University of Minnesota is a big commuter college - and only a small number of people live in dorms, but I spent my freshman year at the University of Iowa, where almost all freshman live in dorms - or did back in the Middle Ages when I was there) didn't have that advantage.

My husband's alma mater makes every Freshman live in the dorms. After the first year you can do what you want, but they think that a year of dorm life is essential to transitioning - and the college experience. I went to a college nothing like his (mine were large state run institutions, his was a small private liberal arts college) - but I think there is something to that.

 

[crisi]

To the ops question though $100 a month is $1200 a year - that will have $4800 for Freshman year. Compare that to housing costs. Its my opinion that if you can hack paying tuition and your kid is saddled with room and board expenses, you've done darn well on funding your kids' college. Its also my opinion that if they can avoid working too much - particularly Freshman year - they'll be more successful. A summer job, the money you save, the extra $1200 a year you'll be able to continue to invest when she is in school, and I think you can manage without loans - or if you need them, they'll be small. Because this is relatively short term, I'd just put your money into a money market or save up $1000 worth of it and ladder a few CDs so your daughter has $1000 a year.

 

[mtblujeans]

Our in-state colleges require that the kids live on campus in dorms their first year. You might check on that type of requirement before planning on possibly living off-campus.

 

[disykat]

I think for dorm costs, you can't expect to compare a shared room to an entire aparment. However, I did share a two bedroom/one-bath apartment with three other girls my senior year for WAAY cheaper than a dorm - which also would have had shared bedrooms and bathrooms. If you expect a nicer, more private place - I would expect it to cost more.

That said, I wouldn't have missed the dorm experience for the world and hope my kids love it like I did and stay there at least two years.

 

[TnTWalter]

I am a college Admissions Counselor - I usually work with parents of seniors, and they are asking the same or similar questions...... a little too late!

Kudos to you for thinking of where your DD will live while she is in college - a few years in advance, while you still have time to ACTUALLY save money!

So, you want to save money for housing (room & board) - let me give you a few suggestions!

SCHOLARSHIPS! Believe it or not, in no way shape or form is it too early to start thinking about applying for scholarships - even as an underclassmen!
There are scholarships out there that are awarded to underclassmen - usually based on career shadowing experiences, community service, academic performance, and a ton of other variables. Be sure to register on fastwest, free 4 U, and other similar websites.

A few words of warning - DO NOT PAY FOR A SCHOLARSHIP SEARCH WEBSITE! The free ones have the same exact scholarships as the pay websites do. Don't be fooled by 'HUGE' awards - or 'Free rides' - 99.999% of 'free ride' scholarships are awarded based on academic merit - to seniors only. There are a few underclassmen awards out there that cover the vast majority of costs, but they are few and far between and are usually very targets for very specific populations.

The PP mentioned being a Residence Aid - the University I work for does the same arrangement for residence life staff. These opportunities are open only to upperclassmen. The positions are filled through a pretty intense interview process, because it does take a very specific personality to take on a leadership in a residence hall.

Next - birthdays - holidays and other times when gifts are given make a great opportunity to provide 'matching funds'. If she receives a gift of $20.00 - offer to match it 100% if she puts it in her college savings account. $20 turns into $40. It is a great way for a student to take ownership of their future college expenses.

A big one here - SHOP AROUND! Don't just look at tuition costs when thinking about colleges - look at room & board costs as well. Be realistic when it comes to costs, but DO NOT allow your family to be taken advantage of.

College costs across the country are soaring - and don't allow your home state's budget crisis become your family's budget crisis.

You would be surprised at how quickly the idea that 'out of state' means 'out of budget' is being dissolved.

I am traveling across the country to CA to recruit college students due to that state's budget crisis that has pushed their in-state colleges raise tuition, leaving students to saddle the debt of a state's education budget cuts.

The average "B" student is going to pay just over $16,000 a year at the University I work for - and that cost includes tuition, fees, room & board - for an out of state student.

ALWAYS remember - and NEVER forget that a high price tag DOES NOT equal a better or higher quality education. Why a student would pay almost a 1/2 million dollars for an undergraduate education is beyond me.

The best approach that students are taking these days is to go to an inexpensive - higher quality - institution for their undergraduate degree - and save money to go to graduate school.

A Bachelors degree doesn't go as far as it used to - and more importantly, be sure your DD is realistic about the starting salary in her chosen profession when considering where to go to college.

When I see a student paying $50,000+ a year to earn a BA in Education, I want to show them job postings that include the starting salary for teachers. Hopefully - the shock would wear off quickly, and the student would hopefully pursue a different institution.

But - after all of that, I'm a little off topic!

Anyway - back to the topic at hand - saving - the biggest thing to remember when saving is this - SET A GOAL.

I always tell students, an illusive goal will never be reached.

Set a goal - $1,200 a year should be your minimum - that's $100 a month - and over the next 4 years that would be $4,800 - and believe it or not, that doesn't even being to cover the cost of room and board for one year at every institution that I know of.

So - shop around right now, see what the average cost of Room & Board is right now - and set your goal based on that figure. To cover the basic costs out of pocket in 4 years - you are going to need to save a minimum of around $500+ a month for the next four years. ($24,000 over 4 years)

Finally - don't forget that every student qualifies for $5,500 in student loans their freshman year, and a little more every year after that. That total is $22,000 minimum over 4 years. No one likes to be in debt - but in all reality - that isn't a terrible amount to owe at the end of 4 years.

Here is an idea - make a poster of a balance scale or similar - for every dollar saved - that's one less dollar that your DD will have to borrow.

Also - don't forget about scholarships - they are out there - even for underclassmen!

great advice.

 

[MrsPete]

Its also important to look at other things than rent cost - you have to evaluate the kid as well as the institution and the finances. A year of dorm life makes a nice transition between "mom is there to do my laundry, grocery shopping, feed me, pick up after me, pay for things, and help me arrange my life" to "I'm on my own."

I totally agree that some kids NEED the extra support of a dorm, while for others it's just an inexpensive, convenient place to live -- some of those kids are perfectly capable of living on their own at age 18.

I really think my now-17-year old could go straight to an apartment and be fine. She's not particularly domestic, but she can certainly do laundry and cook . . . and she'd figure out paying bills without much trouble. She's really the cautious girl who wouldn't bring a first-date over to her apartment while no one else is home. Still, I'm pushing her towards a dorm for her first year (not that I need to push -- it's what she wants). Why? Because although she could survive in an apartment, a dorm is a better situation for her. Why should she take on additional adult responsibilities AT THE SAME TIME as she's making the adjustment from high school courses to college studies? Why should she put in the extra time to clean, shop for groceries, etc. while learning her way around a new town? Sure, she COULD do these things, but the extra support provided for freshmen in dorms won't hurt her.

Personally, I'd like to see her stay on campus all four years; and my oldest is exactly the right personality to LOVE dorms. I did. But after her freshman year, if she wants to go off campus, I wouldn't argue with her. If she'd completed one year with good grades and had those college study-habits down pat, I'd feel that she was ready to add on independant living chores too.

To the ops question though $100 a month is $1200 a year - that will have $4800 for Freshman year. Compare that to housing costs. Its my opinion that if you can hack paying tuition and your kid is saddled with room and board expenses, you've done darn well on funding your kids' college. Its also my opinion that if they can avoid working too much - particularly Freshman year - they'll be more successful. A summer job, the money you save, the extra $1200 a year you'll be able to continue to invest when she is in school, and I think you can manage without loans - or if you need them, they'll be small. Because this is relatively short term, I'd just put your money into a money market or save up $1000 worth of it and ladder a few CDs so your daughter has $1000 a year.

This is just what I was thinking. With the tuition out of the way and four years to save, this is do-able. It's also reasonable to expect your daughter to work at least during the summer and to contribute to her college costs -- even if it's just books.

I think for dorm costs, you can't expect to compare a shared room to an entire aparment. However, I did share a two bedroom/one-bath apartment with three other girls my senior year for WAAY cheaper than a dorm - which also would have had shared bedrooms and bathrooms. If you expect a nicer, more private place - I would expect it to cost more.

Absolutely true -- but we weren't talking about nicer digs. We were talking about the least expensive way to house a college student, and in my area dorms are considerably less expensive than apartments.

I agree with you that I'd like my girls to live in dorms for at least two years. It's a unique living situation that they can never go back and have later in life. It's a carefree living situation in which they don't have to clean, shop for groceries, etc. It's an easy place to meet people and to totally immerse oneself in college studies. I'd really be happy if they chose to stay on campus for all four years -- after all, they have the rest of their lives to live in apartments and houses.

 

[mtblujeans]

....I agree with you that I'd like my girls to live in dorms for at least two years. It's a unique living situation that they can never go back and have later in life. It's a carefree living situation in which they don't have to clean, shop for groceries, etc. It's an easy place to meet people and to totally immerse oneself in college studies. I'd really be happy if they chose to stay on campus for all four years -- after all, they have the rest of their lives to live in apartments and houses.

We feel the very same way!

 

[disykat]

We were talking about the least expensive way to house a college student, and in my area dorms are considerably less expensive than apartments.

.

You're lucky, because here, even in the city it's less expensive to share rooms in an older apartment than to be in the dorm.

 

[luckey-lasvegas]

Well we have some semi-good news. The state of Nevada has funded the millenium schoalship through 2015 , the year DD graduates. Lets hope the state is in a better position in four years and funding it for the four years my dd will be in college won't be such a ???? Now she just has to qualify for it