College is an Investment

The current perception in the United States is that a four year college degree is the secret to financial success. Many high schools expect their graduates to move on to a university and continue their education. Students who don't plan to move on tend to be lectured by counselors, teachers, and principals about how they are giving up on their future dreams by not getting a degree. For those who do choose to advance their education, there are many scholarships that can be applied for. Unfortunately, for most students, scholarships alone are not going to be enough to pay for books, tuition, rent, and other expenses. This leaves loans, either through the government or private parties, as the only option to afford a four year degree. This is where it becomes critical to plan ahead when seeking a degree.

The Reality of a Degree
When considering college, the first question to consider is "why am I doing this?" Unless your family is independently wealthy, the purpose is usually to increase your lifetime earnings potential and find a good career. You may also learn a lot of interesting facts, make some good lifelong friends, find a girlfriend/boyfriend, and have other valuable experiences, but your financial future should be one of the primary reasons for attending.


If your degree isn't passing these out, you might want to pass on it.

It's true that those who have a college degree tend to make more money overall than those who don't. Unfortunately, that depends strongly on what degree you get while you're there. Some majors don't leave students with great job prospects after graduation. For instance, you might go through four years of college, get an English degree, and be completely unable to find a job or only find one that barely pays above minimum wage. Additionally, tuition fees have risen dramatically over the last decade and financial aid has not risen correspondingly. For instance, one political science student in this story has $140,000 in debt and was only able to find a position at a non-profit that pays poorly.

It's important to look at what job opportunities are out there for your prospective degree choice. Look through job postings that you would qualify for with that degree, take a peek at the average salary, and evaluate the tuition and fees of your college to see whether you can make a living doing that. Consider whether you're willing to move to find a job or not-if you are you're likely going to have a lot more options. If you live in a state like Michigan that's currently losing a lot of the population, you're likely to have a lot more difficulty finding work than if you live in Texas.

Where to go to School
One factor that makes a huge difference in the price of a school is whether you attend a public or private university. For example, compare the price of one year at private Albion College with the public University of Michigan. One full year of tuition at Albion is about $32,100. A full year at the University of Michigan is about $12,634. If you include room and board, Albion costs significantly less there and the prices become closer, but are still roughly a $10,000 a year difference.

Another significant expense is choosing to attend school outside of the state you have residency status in. At the University of Michigan, Michigan residents pay that $12,634 a year fee, but out-of-state residents have to pay $37,782, about three times as much. Over four years of school, that's a solid $90,000 price difference. Some universities allow certain out-of-state attendees to receive in-state tuition, but it's very important to look into that before picking a school.


You may not need a passport to cross this line, but it will certainly make college more expensive!

Attending a community college, even though it is not as prestigious as a four year university, can save you a huge amount of money. 18 credits for two semesters at Washtenaw Community College is only about $3,500 for a resident. Compared with $12,000 for a year at the University of Michigan that's quite a bargain! One nice way to utilize community colleges is to take classes that transfer to a four year university. That way you get the prestige of a bachelor's degree from that larger university but pay significantly less money.


The only downside is the line for using the Community College's computer.

Where to Live
The final major component of the price of college is housing-and there are important choices to make here too. Living in the housing provided by colleges and universities is rarely a good deal. Usually you will end up paying $5,000-$10,000 for two semesters of housing. Assuming you're at school for about 9 months of the year, that's %555-1,111 a month! That fee also typically includes a roommate and sub-par housing conditions.


Roommates are also typically randomly assigned.

A less expensive option is to live off-campus. Most colleges and universities tend to draw a large number of rental properties in the area, ranging from apartments to houses. With the aid of a few friends, the rent for these living arrangements can be quite reasonable.

By far the best deal, if you can get it, is to live with your parents until you're done with school. It may be a bit hindering but it saves you around $10,000 or so a year in room and board. For a 4 year degree, that's $40,000 in your pocket. For a lot of college graduates I know, that 40K would be enough to pay off all their student loan debt and leave them with no debt as they begin their careers.


Good times!

Conclusion
Before planning which college to attend and what degree to major in, look at what the purpose of college is for you. For most, the purpose is to achieve financial independence and to find a solid lifetime career. Hold that purpose foremost in your thought process when looking for schools to attend and you will graduate with much less debt and a better career future than many of your compatriots.