Strategies to help reduce the high cost of college
(Part 2): College Special – Get a 4 year degree in only 6 years!
Ok, so the subtitle is a little “tongue in cheek.” But, when I meet with families to discuss college planning, I try to make it a habit of asking parents and students, “How long do you think it takes to get a four year degree?” After the blank stare, they ususally answer, “Four years.” Haha! That answer is exactly what I want to hear. Now is my chance to educate.
As I discussed in the last article, “Turning the College Crisis into an Opportunity,” the average length of time that students spend in college in pursuit of their degree is around five and a half years. In fact, stats from the National Center for Education Statistics point to the fact that only about 38% of students are graduating in four years and an even more troubling number … less than 59% have graduated with a degree within six years!
And it’s not just the extra time wasted in college or spent on extra tuition. It’s also lost opportunities, like working a year or two earlier earning career scale income, paying off debt sooner, and building a resume of actual career work experience. For the almost 50% that don’t graduate at all, there is lost time and student loan debt that did not lead to a degree. So, how do you increase your student’s chances of graduating in four years, saving on the total cost of attending college, and getting the student out in the real world to thrive and gain valuable experience?
The answer is partially financial… but mostly academic. Since I’m known to many readers as a financial planner, it may seem strange to hear me discuss academic planning. However, a critical part of what I do as a college planner is to help families navigate through many of the academic issues that they will have to face. Not graduating on time, or with a career that fits the student, is directly related to a family’s future cash flow, ability to pay down debt and parents’ retirement. It also can affect the student’s ability to get a head start in life (buy a home, start a family, plan for retirement, and so on).
In my experience, you can greatly increase your child’s chance of graduating in four years by doing the following steps, in order, to help ensure a higher chance of success:
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Choose a career path
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Choose a major
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Choose the school
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Maximize financial aid
Choose a career path
Think for a moment about the vacation you are going to take… not this year, but several years from now. Are you going to fly or drive? It depends on where you plan on going, right? So, why do students choose a major without knowing the career that they want. A specific major, or degree, is often simply one path to a career. Knowing what type of job, or which career interests you, can help you define the best way to get there.
In my opinion, choosing a major before choosing your career can be an expensive waste of time. If you want to spend more than four years in college, extra years of tuition, and rack up student loans, and maybe even graduate with a degree that doesn’t get you the type of job you want… by all means, go to college without a career path.
How do you do research careers? There are many great resources to help students research and find careers that could fit their personality, desire for growth, and income, etc. Some are free, like at high schools that offer access to Naviance and Career Cruising. Guidance counsleors and teachers can often help with directing students towards career choices. In my practice, we currently use a tool that is offered by an internationally recognized personality career assessment company. This type of assessment helps a student drill down to specific personality traits and which careers are best suited for different aspects of their personality.
Choose a major
Just as I truly believe that you shouldn’t choose your degree major before you have chosen your career path… I absolutely believe that your student should not enter college with an undeclared major. If your child doesn’t declare a major upon entering college, heed my advice, and make sure that they have chosen one by the end of the first semester!… Otherwise, be prepared to graduate in 5+ years, or maybe even not at all. I’m sure many colleges would love for your student to not declare a major in freshman year… what a relief they must feel to get more than four years of tuition out of your family for only a four year degree!
You may find that a number of different majors might all qualify your student for a specific career. By having researched the career first, your student will be better prepared to choose the best major/degree path that gets them there. So, if you child wants to become a management executive, they may be able to get there by getting a bachelors degree in business administration, or finance, or by getting a specialty degree like nursing and then following that career track and mabe getting an MBA. Which one is the right one? Depending on the student’s interests and talent, any one of these majors could be an appropriate way to enter into their career. But getting a biology degree simply because it “opens doors” isn’t good enough (unless your career path is actually to become a biologist)! Again, your child should choose the career path, and that will help them choose the major.
Choose the school
Once you know the career and have chosen the major, colleges that you apply to should not only offer that major, but prepare students for it well. Check out the graduation rates, what their financial aid packages typically look like, campus life, total net cost, and also factors like job placement rates upon graduation. You can check out sites like CollegeBoard.org’s Big Future section
Maximize financial aid
As you apply to schools, I suggest trying hard to create a plan to pay for it that doesn’t affect your family’s lifestyle during those college years… or jeopardize your retirement. Maximize your chances of the best financial aid package, through the proper academic prep (SAT/ACT tutoring, AP courses to boost GPA and class rank in High School and count towards future college course credits). Understand how to correctly answer questions on the FAFSA and CSS Profile forms to accurately reflect your financial situation, yet still potentially help your family qualify for more Financial Aid. Also, take advantage of the many strategies available to legally exclude part of your income and assets from the financial aid calculations. Finally, now is the time to analyze your cash flow and see how you can pay for any shortfall… by tapping assets in a more intelligent way rather than scrambling to access cash, without jeopardizing your retirement.
As they say, time is money. Smart choices in college planning can help your family avoid spending too much on your student’s college. It can also save them time and get them to a career in which they can thrive and enjoy.
Feel free to contact us or schedule some time to talk using our online appointment calendar.