With summer vacation in full swing it’s never too early to think about next fall’s college budget. Whether you go to school online or on-campus, college always seems to cost more than you bargained for. According to the Huffington Post there are over $23,000 in hidden college-related costs (outside of tuition) per year, per student. That amount varies depending on where you go to school and is slightly less for online education students (because they don’t live in dorms or have to rent housing near their schools).
So what are these hidden costs? Turns out they’re not really hidden at all, they’re just so mundane you forget they can nickel and dime you to death. So before you finalize your upcoming college budget consider these little money suckers first.
- Utilities
- Food
- Car expenses
- Entertainment
- Travel Expenses
- Fees
If you rent an apartment or house and your utilities are not included, then the cost of electricity, gas, water, sewer, trash removal, cable TV, and Internet can be up to 50 percent of your monthly rent. Even if you opt for online education, your electricity bill will probably go up by at least 10 percent, due to the fact that you’ll be on your computer more and keeping later hours doing homework.
The solution? If you rent, try to get a place that includes as many utilities as possible rolled into your monthly rent. Free cable TV and WiFi alone, for example, can save you about $1,200 a year.
No matter how much you budget for food, you’ll probably spend at least 25 percent more than you planned. Not because you’ll eat more, but because you’ll eat food that costs more. When you go to school you suddenly don’t have time to do things like grocery shop or cook. As a result, you’ll eat out often, and as we all know, even fast food adds up.
The solution? Shop for as many “easy foods” as possible. Eating fresh fruits and veggies as snacks, frozen meals that can be heated up, and leftovers from a weekend big meal are all good ways to keep your food bill under control.
Even if you own your car outright, you still have to pay for gas, parking, insurance, registration, and maintenance, all of which comes to about $3,000 to $4,000 a year for a used car owned by a person age 25 or older, with little or no commute.
The solution? Dump your car, if possible. Even though it’s not as convenient, rely on public transportation, join a carpool, bike to school, or simply walk. These options also increase your exercise frequency, which is good since you’ll be sitting around a lot doing homework.
You can’t tell yourself that you won’t go out while in school. Believe me, you’ll need the break, especially if you’re an online student who doesn’t have the luxury of socializing with other students.
The solution? Opt for the simple things; a hike, camping, free concerts in the park, picnics, school sporting events, tennis on free courts, farmer’s markets, etc. If you do want to go to the movies try to catch a matinee when it’s cheaper, and stop at the store first to buy your treats. This would also be a good time to cut down on your alcohol consumption, as cocktails are not cheap.
If you live away from home to go to school, you’ll have to budget for airfare at least twice a year for winter and spring breaks.
The solution? If you can’t afford to relocate, online education is an option. Otherwise, think about other forms of travel to get home; the train, ride sharing, and even the bus if it’s not too far. If you live across country, however, you’re at the mercy of the airlines. Figure out how much it costs to fly between school and home and factor that into your college budget.
No matter what you major in you’ll undoubtedly have hidden equipment costs for some of the classes you take. For example, science lab fees, music practice room fees, art class supply fees, etc. Plus, if you join professional groups or the Greek system you’ll have membership dues.
The solution? There isn’t one. You need these classes and organizations to graduate so you’ll just have to suck it up. Just be sure to include a line item in your college budget for class fees and professional dues. Check your course catalogue ahead of time to get an idea of how much you should budget for it.
Handling on your college finances is a great way to prepare for the real world. It’s a misconception that the big bucks start rolling in as soon as you graduate. But if you do land a lucrative job right out of college just think how fast your nest egg will grow with all those years of smart college money management under your belt.
Do you know of a college budget line item that is often overlooked? Share it with our readers by leaving a comment. We’d love to hear about it.
Only you can answer this question openly and honestly. If you love money and are financially minded, this most definitely is something worth looking into. Upon completion of a degree, you can apply for excellent jobs in this field.
Types of careers in Finance
- Financial Analyst- Financial analysts according to the wise geek on wisegeek.com, “ are concerned with providing a comprehensive understanding of the financial status of a given investment opportunity.” Financial analysts can expect to find jobs in banks, investment firms, mutual and pension funds, and insurance companies.
- Personal Financial Advisor- “Financial advisors develop a game plan for their client that fits their financial circumstance.” (About.com)
- Accountant- According to Lesley Barker on ehow.com, Accountants “help people to navigate the frequently changing financial investment and tax laws so that they can keep as much of the money they earn as possible.”
- Auditor- Being an auditor is a vital service. Auditors basically check financial business records for accuracy.
- Loan Officer- Loan officer’s help people apply for loans.
3 types of loan officers
- Commercial loan officers- Businesses
- Mortgage loan officers- Deal with people who want to buy a house or real estate.
- Consumer loan officers- Loans for cars
Before you officially decide on whether or not to pursue a degree in finance, (degrees such as: an Associate’s, Bachelors, Master’s, etc.) you may be interested in reviewing some of the reasons why to pursue a degree and then a job in this field:
10 reasons to study Finance
- The broad range of job opportunities.
- A very bright future for your career.
- Compensation is coveted. Because this field is considered “white collar” you will most likely be paid very well.
- A job in finance is very prestigious, not just anyone will get the job.
- This field is often challenging. Your responsibilities and performance on the job is crucial to the company you are working for.
- Continuing education
- A chance to go places and travel.
- Very competitive, it’s important to stay on top of your knowledge and skills in the field.
- Job opportunities are long term. You can most likely expect to retire from a job in this field in the future.
- Finance is in high demand.
If all of these above reasons are of interest to you, what type of degree in finance would you be interested in studying? If you are unsure, here is a brief list of the types of degrees in finance:
Types of Finance Degrees
- Associates in Accounting- Kaplan University
- Bachelor of Science (BS) in Business-Finance-University of Phoenix
- Bachelor of Business Administration (BBA) in Corporate Finance-Jones International University
- Master of Business Administration (MBA)- AIU Online
- Master of Science in (Specialty) Management-Boston University
*If you are currently going to school for a degree in finance or currently possess a degree in this field, please share your experiences with us. Any knowledge you have to share regarding finance is greatly appreciated.
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We’d all like to go to college on scholarship or grants, but the reality is there’s only so much free money to go around. And if you choose to go back to school part time while you work (because giving up food is just not an option) then your chances of obtaining a scholarship or grant are even slimmer. (Benefactors tend to give money to full-time students with no other sources of income.)
That leaves the dreaded college loan. We’ve all heard horror stories about graduates having their credit permanently damaged as a result of not repaying their college loans in a timely manner. Or where balloon interest on a college loan inflates upon graduation, leaving the new graduate to start life so deep in debt, it will take decades just to make a dent.
While it is true that managing any debt requires a fair amount of responsibility and willingness to stay on top of the payments, college loans are not nearly as complicated, scary and financially crippling as they used to be. Basically college loans boil down to three categories: government student loans, parent loans, and private student loans.
Government Student Loans (GSL)
GSLs are funded by the federal government, have extremely low interest rates, don’t require credit checks, and offer a plethora of repayment plans. This is where it gets tricky, because if you defer repayment of your student loans until after you graduate you might become comfortably accustomed to a lifestyle and budget that does not include a monthly student loan payment. So (Surprise!) when the government one day comes knocking, expecting a payment, and you haven’t planned for that, well, things can get financially ugly very quickly.
Your repayment plan depends on which GSL you get. There are two; the Federal Stafford Loan and the Federal Perkins Loan. The Federal Stafford Loan has a fixed rate of 6.8% and repayment can be deferred until after you graduate. However, to help offset your debt upon graduation you can set up payment plans for as little as $25 per month while you’re still in school.
To qualify for the deferred payment option you must show need via your tax returns. Two thirds of Stafford loan recipients have a family adjusted gross income (AGI) of $50,000 per year. However, a smaller percentage of recipients have an AGI of up to $100,000. So unless you’re really rolling in the cash, it’s worth your while to look into a Stafford loan.
The Federal Perkins Loan is a little harder to get because it’s a smaller pool of funds and is awarded to students with extreme financial need. Also, Perkins loans are school-based, meaning the individual schools decide who should get assistance however, the loans are funded with government issued money. The interest rate is 5% fixed and the federal government absorbs all the interest while the student goes to school and up to 9 months after graduation. It’s the best deal around, if you qualify.
Parent Loans
If your parents still claim you as a dependent they can take out a Parent Loan for Undergraduate Students (PLUS) loan. In this case, your parents are on the hook for repayment, not you. Like the Stafford and Perkins loans, PLUS loans are government issued, but have an interest rate of 7.9% fixed. Repayment starts 60 days after the last of the loan has been issued (even if you’re still in school), and your parents can take up to 10 years to pay it off.
Private Student Loans
Private Student Loans (PSL) are also called bridge loans because they’re meant to bridge the gap between what the government will loan you to pay for college and what your college tuition actually costs. Unlike the loans mentioned above, PSLs are privately funded by lending institutions, banks, endowments, trusts, and wealthy individuals acting as private lenders. Because there is no safety net in case you default, your credit score pretty much determines if you’ll get a PSL. However, on the bright side there are no lengthy, federal forms to fill out. But because PSLs are privately funded interest rates and repayment plans vary.
Even though a PSL might be easier to obtain (depending on the lender) you should be very careful when you engage in one. To be safe it’s best to have a loan officer or even an attorney check over your lending contract before you take out a privately-funded student loan. Nothing worse than getting into a legal, financial squabble before you even graduate from college.
Now more than ever going back to school is a wise choice. Once the dust settles in this economic downturn wouldn’t you love to be poised to start a new career? That can happen if you take a little time to plan out your college tuition payment options. Depending on your school, major, and financial situation, a college loan may be just the ticket you need to put you on the path to a whole new career.
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