How to Fight Skyrocketing College Costs

By Scott Weingold

It seems like the cost of everything these days is going up.  From energy to food to healthcare and even gas prices. Unfortunately, college is one of them as well. The College Board’s latest survey came out a couple weeks ago, showing that tuition and fees at private 4-year schools rose 4.4 percent in the current school year to $26,273.

Meanwhile, the price of a 4-year public university education spiked more than 6 percent for both in-state and out-of-state students ($7,020 and $18,548, respectively). Lest you think this is a short-term trend, I’ve got some more numbers to share from The National Association of Independent Colleges and Universities, which surveys 350 private, nonprofit colleges and universities:

The group says the average increase in tuition was 4.3 percent in 2009, and it notes that this is the smallest increase since the 1972-1973 school year.  Even worse, the NAICU notes that the average annual increase in tuition and fees has been 6 percent over the last ten years!

That is a family like yours supposed to do to try and keep up with these rising costs?  Here are a few proven ways to do it.

#1: Save as much as you possibly can on a monthly amount in a separate account (for each child) earmarked for college.  There are two key points with this step.  Be consistent with the amount. Make it an automatic deduct from your checking or savings account if possible.  And secondly make sure the account has some sort of guarantee built in.  The absolute number one mistake we see parents make when saving for college is risking their kids future in an investment that can lose anywhere from 10%-70% during any given period. That is simply not acceptable.

A second proven way (which might be a little premature if you have a younger child) is to select the absolute best college or university for your child for the price. Don’t get me wrong, we don’t want to see you go cheap and select a college simply for the price. A college education at the end of the day is setting your child up for the rest of their life. You must choose wisely.  But at the same, college should be paid for without sabotaging your financial future.  There is a fine line which your family should walk carefully.

And if worse comes to worse and you need to borrow a manageable amount – you have options.  Here is great tip for when the time comes. Over 250 different types of college loans are available in the U.S. marketplace right now.  Which is the best one for your family?  And how do you know if you are getting the best rate and terms?

This used to be a tricky question for families.   But not anymore. There are several companies that compile all the information regarding rates and terms of every type of college loan on the marketplace… and put them into one easy to research tool.  But there is a catch.  Every one of these “college loan comparison” web sites give preferential treatment to the loan companies who pay them for placement.  In other words, they make it seem as if certain loan companies are the best deal… even if that is not truly the case.

However, one nonprofit organization does not accept paid placement money in listing available private loans.  That company can be found here: http://www.finaid.org/loans/privatestudentloans.phtml Visit this site when you are ready to get the absolute best deal on a private college loan for your child.


Related Articles:

How to Save for Your Child’s College

How to Pick a College or University That’ll Give You the Best Financial Aid Package

How to Keep Your College Costs as Low as Possible

Is a College Education Still Worth the Money?