Jeanette A. Tucker | 4/19/2005 10:28:36 PM
Financing a college education is often a partnership among the student, family, school and lending agency. To succeed financially, LSU AgCenter family economist Dr. Jeanette Tucker encourages college students to discuss the costs with their families to clarify the extent to which each segment will be financially responsible.
Once all the roles are clarified, consider where flexible costs can be adjusted to develop a spending plan that allows you to live within your means. Besides tuition and books, flexible costs may depend on where you choose to live, how/where/what you choose to eat, method of transportation that you use, your choices of entertainment, recreation and socialization, the courses in which you are enrolled regarding the books, projects, fees, etc.
Tucker says to consider these strategies to control your spending plan:
• Always maintain the highest grades possible, thus providing yourself the ongoing opportunity to be eligible for scholarships and merit awards as they become available.
• Pay your expenses along the way to reduce debt and interest payments later on.
• Be careful how you use your credit cards. Research warns us that more students drop out of school from problems with debt and credit than poor grades. If you owe $1,000 on your card at 21 percent interest, you will accrue interest charges of $211.15. You would have to work 41 hours at minimum wage pay ($5.15 per hour) just to pay the interest.
• If you do get into financial trouble, don’t let it destroy you or distract from your studies. Work it out. Get advice from a trusted and knowledgeable adviser, financial counselor or credit counselor.
• Maintain a good credit history. Request a copy of your credit report from one of the three national credit-reporting agencies: Equifax (www.equifax.com), Experian (www.experian.com) or TransUnion (www.transunion.com).
• Maintain a regular schedule of sleep, work, classes, study, social and recreational activities.
Tucker offers several possible cost-reducing strategies:
• Compare the cost to attend college minus grants or scholarship assistance to see what your real out-of-pocket expenses would be. Don’t assume that you can’t attend a higher cost college until you review the financial aid that you will receive.
• Attend a local community college during your freshman and sophomore years. Then transfer to a four-year institution to complete your undergraduate education.
• Compare the costs of having an apartment versus staying in a residence hall. Be sure to include deposits, utility costs, phone and Internet service. Consider the responsibilities of apartment living and evaluate your reasons for attending the university.
• Consider living at home and commuting to classes, but actively participate in campus organizations and events.
• Parents can consider owning an apartment building that you will manage and/or reside in for several years.
• If planning to attend school out of state, consider living in that state for one year to declare residency to avoid the higher out-of-state tuition. Check out state and college residency requirements.
• Compare interest rates and total costs of loans over time with different interest rates.
• Borrow just the minimum.
•If you have difficulty repaying your student loan, first try to increase income and reduce expenses, then check your lender’s "forbearance policy." Some lenders lower your payments for a period of time. Always talk to your lender if you experience problems in loan repayment.
"Your greatest investment in life is your education," Tucker says, advising, "Plan to reduce other life expenses to afford the enrichment and empowerment that a degree can provide."
For information on related family and consumer topics, visit the FCS Web site at http://www.lsuagcenter.com/Inst/
Extension/Departments/fcs/ For local information and educational programs, contact an extension agent in your parish LSU AgCenter office.