It’s not always possible to avoid college debt, but try anyway

When Rebekah Bell wrote an article for the Wall Street Journal about how it’s possible to graduate from college debt-free, some people scoffed.  Bell is a freelance writer who recently graduated from Biola University, and here’s the essence of her advice.

Scout out scholarships, take courses online, use your skills to make money and get a summer job.

Dave Berry, CollegeConfidential Senior Contributing Editor, had this reaction.

Duh. Good luck with that.

Realistically, it’s almost impossible for many students to escape college debt.  With today’s high college costs, even following Bell’s common-sense recommendations may leave them with a funding gap that can only be met by borrowing.  Still, she did cover the bases on some essential ways to cut costs.

• Look for scholarships/tuition discounting.  Maximize your merit aid opportunities by applying to schools where your statistics are in the top quarter of admitted students.
• Take  online classes if you can; they’re often less expensive.
• Start out your first year or two at community college.
• Maximize college credits with AP courses, dual enrollment, and College-Level Examination Program (CLEP).
• Earn money during college.  Working 10-20 hours a week is manageable for many students.
• Look for paid summer internships.
• Be frugal.

I would add that graduating in four or even three years makes a huge difference total college costs.  So taking advantage of AP credits and hustling to take all courses needed in time can amount to big savings.

Related:

• Regional interstate compacts as a way to cut college costs (Cost of College)
• Preferential packaging – college financial aid as a recruiting tool (Cost of College)
  

Quick Links – Washington State pension trouble; NYC high school grads need remedial help; teacher evaluations are ‘costly experiment’ …

◊◊◊  Washington State’s public pension may be in trouble.

The problem, similar to that in other states, has to do with the way pension benefits are valued.

Public pensions such as Washington’s operate under special accounting rules, one of which allows them to assume a long-term rate of return on their investments. Most plans have picked a rate between 7 and 8 percent; all but one of Washington’s plans assume 7.9 percent.

That assumed return is significant, because another special rule lets public plans use it as their discount rate — something corporate pension plans were forced to abandon nearly two decades ago.

Critics such as Munnell and Biggs say this rule ignores the fact that pension benefits are effectively almost as guaranteed as state bonds. That, they say, means they should be valued similarly to bonds.

“The way to value a stream of promised benefits is with an interest rate that reflects the riskiness of the promised benefits themselves, not the expected returns,” Munnell said.

This story is being ‘repeated all across the nation’ according to Walter Russell Mead.

… It’s as well-written a summary of a pension crisis story as you’re likely to get, and this is a story that’s being repeated all across the nation. Then, if you haven’t already, have a look at how much you or your loved ones are relying on generous promises made by state bureaucrats to fund your retirement—and start asking some hard questions.

◊◊◊  Most NYC High School Grads Need Remedial Help Before Entering CUNY Community Colleges (CBS New York)

Officials told CBS 2′s Kramer that nearly 80 percent of those who graduate from city high schools arrived at City University’s community college system without having mastered the skills to do college-level work.

In sheer numbers it means that nearly 11,000 kids who got diplomas from city high schools needed remedial courses to re-learn the basics.

◊◊◊  New York teacher evaluations are a “’grand and costly experiment’ with limited benefits”.

N.Y. schools’ teacher-eval costs outpace federal grants

ALBANY — New York’s small-city, suburban and rural school districts expect to spend an average of $155,355 this year to implement the state’s new teacher and principal evaluation plans, a report Thursday from the state School Boards Association found.

The one-year costs outpace the four-year federal grant provided for funding the program by nearly $55,000, according to an analysis of 80 school districts outside the state’s “Big Five.”

“Our analysis … shows that the cost of this state initiative falls heavily on school districts,” said Timothy Kremer, the association’s executive director. “This seriously jeopardizes school districts’ ability to meet other state and federal requirements and properly serve students.”

The evaluation system is a requirement for receiving funds from President Barack Obama’s Race to the Top initiative. In 2010, New York was awarded $700 million in Race to the Top grants. About half of the funding will go to local districts over four years to implement the evaluation system and other initiatives.

◊◊◊  20,000 illegal aliens apply for college financial aid under California’s new Dream Act.

More than 20,000 college-bound students are seeking state financial aid for the first time under California’s new Dream Act laws that allow them to get the help despite their immigration status.

While far from a complete picture, that number is the best indicator yet of how many students hope to benefit from a pair of laws that could radically change the college experience for a generation of students whose parents brought them to the U.S. illegally when they were young — the same group that has taken center stage in the national immigration reform debate.

Virginia offers guaranteed admissions to universities for certain community college graduates

One commonly recommended option for cutting college costs is to attend two years of community college before finishing up at a four-year school.  This option is even more attractive in those cases where colleges and universities offer guaranteed admission to graduates of selected community colleges.  Virginia is one place where this occurs.

Virginia’s community colleges offer students more than the opportunity to earn a degree or certificate. They provide a gateway to the Commonwealth’s four-year colleges and universities.

Through system-wide agreements, students who graduate from one of Virginias 23 community colleges with an associate’s degree and a minimum grade point average may obtain GUARANTEED admission to more than 20 of the commonwealth’s colleges and universities.

A student wishing to attend the University of Virginia, a selective school with a 33% admission rate and ranked #24 among national universities by US News & World Report, could save thousands of dollars and secure guaranteed admission by completing his first two years at Northern Virginia Community College.  The agreement between the two schools stipulates the following:

At least 54.0 credits from Northern Virginia Community College

At least 45.0 credits must be completed at University of Virginia

A cumulative GPA at Northern Virginia Community College of at least 3.4

No grade below a C in any Northern Virginia Community College course

The estimated cost savings over four years would be about $40,000, assuming the student lived at home for the first two years.  Guaranteed admission to a selective university along with the savings make this a very attractive option.

Other locations have similar programs.  The UMass Amherst Community College Connection offers guaranteed admission for community college graduates who meet certain criteria, including a  cumulative GPA of 2.5 or higher.  The  California State University system gives priority admissions to community college graduates, but waiting lists have recently made this option less secure.  The University of California Transfer Admission Guarantee (TAG) has also been affected by funding that has failed to keep up with enrollment, even leading to the termination of the program at UC San Diego.

Advice for students considering first enrolling at a community college as a way to save money on their bachelor’s degree?  Do your research, including this recommendation from CNNMoney:

Ask the community college if they have any guaranteed transfer programs to four-year universities and what course and grade requirements you must meet to qualify. If they don’t have guaranteed programs, ask which universities have “articulation agreements” that will at least give you some guaranteed credits.

HT Joanne Jacobs

Families in New York’s Lower Hudson Valley adjust to rising college costs

The high cost of college is playing an increasingly important role in the way Lower Hudson Valley families go about choosing schools.  Students representing a wide range of economic demographics – from New Rochelle HS (41% students qualify for free lunch) to Fox Lane HS (only 5% qualify) – are choosing community college as a way to save money.

A high school guidance counselor sees more students who have decided to cut costs by giving up the dorm experience.

“If it’s their first time around, the price tag is shocking to parents,” said Cleary, noting that in recent years more of her school’s graduates live at home and commute to colleges within an hour’s drive to save money.

One student’s story offered a window into how the faltering economy may actually be causing families to make wiser choices.

New Rochelle High School graduate Chanelle Cawley considered attending Queens College and The Art Institute of New York.

“It was really expensive, basically, to pay that much money for my freshman year,” said Cawley, 17, who graduated Thursday from New Rochelle. She decided against the more expensive schools and opted to start at Westchester Community College, where she will study Web design.

“It’s a great program to start, and once I do my two years I can just go and transfer to a different school,” she said. “I’m planning on going to The Art Institute.”

Yearly tuition at The New York Art Institute (AI) is approximately $25,000, with housing costs adding about $20,000 more.  AI’s parent company, Education Management, is battling government charges it violated federal law in garnering billions of state and federal financial aid.  It is hoped that Cawley will look carefully at potential job prospects before she takes on student loans to study web design at this school.

Some advice for parents of high schoolers facing the high cost of college

When their kids are babies, parents often start out with high hopes that they will be able to provide them with the best college education that money can buy.

But when high school rolls around, “the fact is their kid is a solid ‘B’ student, not a super athlete and they have no savings,” Osborn said.

Yet many parents still yearn to foot the entire bill — or most of the bill — for college so their kids can avoid a lot of debt.

Some practical advice for parents of high school kids who are facing the reality of high college costs

Do:

• Make children part of the saving process as early as possible. No mall jobs? Try babysitting, yard work, dog walking, etc.
• Paying for their tuition? Start with personal savings, then go to government-backed student loans — which have low interest rates — and PLUS parental loans. Private bank loans are an option but have high interest rates.
• Use your network — family, friends, church, etc. — to help your children explore careers in high school. It will focus their high school and college studies, possibly cutting down on costs.
• Consider community college, which is far less expensive, for the first two years of undergraduate work and then a transfer to a four-year institution.
• Assess your child. Not an “A” student? A bit immature? Students often drop out after one year. Consider community college before splurging on a four-year school.
• Encourage students to make the most of high school — by looking for opportunities for college credit or dual enrollment.

Don’t:

• Use retirement funds to pay for college costs.
• Overlook less expensive in-state schools.
• Overborrow for college costs. Keep non-tuition and academic expenses to a minimum.
• Overspend on housing, furnishings or cars for college students — especially during the first few years, when many students drop out.
• Be afraid to let children take on some college debt. It will give them a bigger stake in their college success.

Starting out at community college works out well for academically prepared students

This might be good news for those who start their four-year degree program at a community college to save money.  If you’re among the 25-40% of community college students who actually make the transition to four-year colleges, your chances of degree attainment compare favorably with those students who started as freshmen there.  However, this is only true if you are similar to the rising juniors in terms of academic preparation and other characteristics.  The average community college student still lags behind in graduation rates.  Overall, these new study results are not too surprising.

… Authors Tatiana Melguizo, Gregory S. Kienzl and Mariana Alfonso present what may be good news for such students in their article, Comparing the Educational Attainment of Community College Transfer Students and Four-Year College Rising Juniors Using Propensity Score Matching Methods, which was published in theMay/June edition of The Journal of Higher Education. Using two separate statistical analyses, they found that transfer students were just as likely to succeed at four-year colleges as similar students who started at the studies four-year colleges.

The authors culled data from the National Education Longitudinal Study (NELS) on students who “graduated from high school on time, enrolled in college, and attained junior status at a four-year college either by enrolling only at a four-year college or by transferring from a community college.” The former group of rising juniors was then compared to the latter group of transfer students based on the average number of non-remedial credits they earned and their bachelor degree attainment rates.  Without controlling for any differences between the two groups, the authors found that rising juniors earned slightly more credits than transfer students and outpaced transfer students in degree attainment 73 percent to 60 percent.

Using a linear regression analysis, the authors controlled for observable, pre-existing differences between the two groups including differences in high school academic preparation, financial aid and work opportunities, county-level labor market characteristics and individual demographic characteristics. The results of the analysis showed no difference between the two groups in the average number of non-remedial credits earned and no difference in their overall rates of bachelor’s degree attainment. Similarly, a propensity score matching analysis which “allows obserservationally similar people to be compared,” revealed no differences between the outcome measures of the two groups. As such, the authors conclude that “community college transfer students earn equivalent numbers of non-remedial credits and attain baccalaureate degrees at similar rates than four-year rising juniors.” They go on to point out, however, that a relatively small percentage of community college students (25 to 40 percent) make a smooth transition to four-year institutions, and that those who failed to transfer with junior status were not taken into account in the study.

Success of Community College Transfer Students and Rising Juniors Compared

Community colleges ‘really aren’t that cheap’?

Pushing students into community colleges for the first two years of college is often touted as a major way to reduce education costs.  However, community colleges really aren’t that cheap.

Average community college E&G budget per student

Community colleges have lower total costs than public regional colleges because they do less research and public service, and provide fewer student services. Instruction costs are slightly lower, but community colleges are only providing lower division courses whereas the public regional also provides more expensive upper division and master’s level courses. In fact, instruction costs for lower division students may be higher at the community college than at the public regional college or the public research university.

The average community college cost per student of $10,985 compares with $6,705 and $9,204 for the hypothetical four-year colleges (CELS) Vance Fried created as part of his study, Opportunities for Efficiency and Innovation: A Primer on How to Cut College Costs.  However, real life public regional colleges  average $14,703, so for now community colleges still look like a good deal.

Fried’s numbers look good on paper, but if some philanthropist (Bill Gates?) would fund his hypothetical college we’d learn if it can really be done.