What about the Xennial?

I reject the term Xennial. I was born at the end of Generation X, and I walked myself home from school, fixed my own snacks, remember the beginning,and end of, dial up, and am paying my own education debt. The Baby Boomers received the life altering support of the Servicemember’s Readjustment Act, affectionately known as the GI Bill. Generation X received increasing tuition and student loans after our Boomer parents decided we they did not want to pay taxes anymore. To add further insult the attempt of late Gen Xers to protest rapid tuition hikes went unheard until the millennials, with their vast numbers, started attending school. Generation X – forgotten again.

After defunding higher education for decades states are beginning to reconsider the damage they have done to their college students and their own economies. As retailers are finding out, graduates with high debt loads do not (cannot?) live the way their Baby Boomer parents did. They are not purchasing homes or cars or the must have granite upgrades to make their gourmet kitchens socially acceptable for the perpetual group of neighbors that people on House Hunters seem to entertain. Instead Generation Xers and early Millennials are gutting it out and trying to hold jobs and get out of debt.

As states course correct and begin offering free college it seems that Generation X is again a latch key kid. Many of us have no problem paying our fair share of taxes to support education, roads, bridges, etc. However, the question of how states are going to pay for free college is hanging out there. What will those of caught in the college tuition escalation of the 90s and 2000s do if we are paying additional taxes to subsidize someone’s education, while also paying off our own debt? How can states look to the future, while also making up for the mistakes of the past?

Income based repayment and public service loan forgiveness were to be the saviors of those of us caught in the matrix. However, the current federal administration is considering modifying both programs in such a way that they are no longer effective.

Those of us caught between two generations need less names to define ourselves and more suggestions regarding how we can survive a volatile job market, actually pay back what we owe, rear the families we now have, and care for our boomer parents who are aging.

Generation X is the one who has been perpetually skipped over, and some of that is to our good.  We are resilient folks who rode on handle bars, and drank from outside water hoses. Our mommas listen to us chastise them about our semi-neglected childhoods and basically ask “did you die”? We didn’t. But we did pay the price waiting for higher education, and policy in general, to figure out that putting the cost of running universities squarely on the backs of students would lead to long term problematic outcomes. We are pleased that policymakers are starting to get it right, but Generation Xers are left asking, as we always have, what about us?

Low-Income Students SHOULD Be Applying to Top Colleges

The research shows over and over again that low-income students do well at “elite” colleges. However, top schools, including the Ivies, keep stating that they do not get applications from these students even if they are highly qualified.

A recent NPR report reemphasized the problem and hypothesized that part of the issue is that low-income students in areas where there isn’t a top performing high school just aren’t being encouraged to push and apply to these schools. You can check out the report here.

In the Washington, D.C. area we have several high schools that are geared toward preparing our varied population to attend college. However, even many of these students, as our own program shows do not necessarily know how to select a list of schools to which they want to apply, and how to prepare a competitive application.

We who work with young people have to encourage them to apply to all types of colleges. Many of these schools will provide a fee waiver for the application if a student reaches out and asks. One of the problems I find is that students are afraid to ask, or do not know to whom to write. We have to teach them to craft professional emails to people in power. This is one of the first lessons we teach in our program.

Another issue is that many times those of us who went to college rely on our own experiences. We have to remember that when we attended we were working with information that was relevant at the time. Just because we didn’t like a particular institution, or it wasn’t affordable to us doesn’t mean that the young people we mentor will have the same experience.

Encourage low-income students with great grades to apply to the schools of their dreams.  The schools are waiting for them.


Net Price versus Sticker Price

How Much Education Can You Afford? Flickr by Jon

In #collegechat hosted by Theresa Smith, we were discussing public education.  I’m a proponent of public ed, and public funding for it as well.  One parent reached out and mentioned that even the cost of public ed is rising, and she is completely right. So how do you figure out the true cost of college and whether you can afford it?

Online there are several “net price” calculators. Net price is the actual price you will pay after financial aid is deducted.  Many students miss out on opportunities to attend great colleges because they assume they cannot afford the sticker price.  What they may not know is that many expensive schools give students enough financial aid so that their net price is equal to that of a less expensive institution.

So how do you find out?  Use the US Department of Education’s net price calculator found here.  There are also other private calculators offered by the College Board (the same people from the SAT).

Don’t make any rash decisions about what you can and cannot afford until you do the real math! You may just find that you can afford your dream school after all.

Not all education is good education

In “Education is the Key to Success” I discussed the merits of the argument that an education should guarantee you a job.  I contend that it is important to obtain some form of college education.  However, it is imperative that students know exactly what type of education they are getting, and from whom they are receiving it.  As the New York Times points out in “In Hard Times, Lured into Trade School and Debt,” not all schools are created equal.

How much is too much to pay?

There are many “schools” out there promising students the opportunity of a lifetime.  They recruit, and recruit hard.  They call you constantly. They email you daily.  Yet, what they are offering may actually be fools gold.  Before signing up to go to any college or university you need to do serious homework.

Some schools are known as “diploma mills”.  These are schools where you do very little to earn your degree besides pay tuition.  While this might appeal to some people, they are highly upset when the realize that these “degrees” have no weight in the business world.  Employers and graduate schools know a fraud when they see it. Diploma mills are often nationally accredited if accredited at all.  Keep in mind that it’s not national accreditation you want; instead you’re looking for regional accreditation.  This is important.  Accreditation is a process through which schools recognize each other.  It means that the school has been evaluated and it is agreed upon that the members of that body will accept each others credits.  Look up the schools you have heard of and you’ll find that they are regionally accredited, not nationally, and this means that these schools only recognize other regionally accredited schools.  If you try to apply to let’s just use Harvard University for graduate school, and your degree is from a nationally accredited institution, they will reject you without looking at any of the rest of your application.  Be sure to ASK about accreditation because even major schools have lost it before.

However, other schools that are properly regionally accredited schools still promise the moon and charge you the sky to deliver.  As discussed by this article, people who are going for trade school certificates are starting to be fleeced, and often they don’t even have a final credible credential to show for it.  One rule of thumb I tell prospective students is that if the school is trying too hard to get you to sign up quick, fast, and in a hurry then the hairs on the back of your neck should stand up.  Look for what they aren’t telling you.  What happens if you decided to sign up for classes and want to drop them?  Can you get your money back?  What is the refund policy? What is the institution’s placement rate after graduation? (Although in this economy everyone is having troubles in this area.)  How much is the tuition in comparison to other colleges and universities?  A 40 thousand dollar per year education, from a little known school may not be worth the sticker price.

A successful college experience centers within your ability to be sure that whatever college you attend, whatever degree or trade school certificate you earn that you can come out of the experience with a debt load you can manage, and a credential that has some long term potential for growth.  You’re going to have to get out there and ask tough questions, filter through long-winded answers, and with hope, find the right fit for you.

Education is the key to success?

The newest trend in higher education seems to be that students and graduates are blaming professors, their alma maters, and the universe for their inability to find jobs in the Great Recession.  They state that someone should have told them that their degrees were not going to guarantee them anything, and that someone should limit the number of people who can go to college because the job market is cluttered.

One blogger cries: What does it say about the state of our nation and the effectiveness of our educational system when a first generation college student with dual degrees from the best universities in America believes the only option left for her is to take out yet another private loan to get her PhD because she is unable to find a job – any job – even as a barista at the local Starbucks?

Well, I still believe in educating yourself to better yourself.  However, that doesn’t mean that I advocate not doing your homework.  You have got to spend time researching your industry.  I hope the above blogger realizes that the job market for PhDs is worse, and has been for a longtime, than the market for lawyers.  At some point you have to take charge of your education and make smart choices.

It may not make sense for a first generation college student to take out massive loans to fund their education.  While it is the dream of many to attend elite institutions, you may have to earn your degree at a less expensive one.  If that’s not the option you want then while still in high school you need to be stellar and earn scholarships.  Tons of schools are reaching out to first generation college students now, so there is money out there.  Those of you who have already graduated with your undergraduate degree may have to seriously reconsider pursuing an unfunded graduate degree.  Colleges operate like businesses, which means they aren’t in the business of handing out free education.  Nor do they come with a money back guarantee.  So before you gamble on earning a professional degree DO YOUR RESEARCH.  Try to talk to people in the field, talk to professors, talk to past alums, spend some time in the library, do a google/bing search.  There is plenty of information out there now.

Also, watch out for diploma mills, and schools that promise the moon and charge you the sky to deliver.  As discussed by this article, people who are going for trade school certificates are starting to be fleeced, and often they don’t even have a final credible credential to show for it.  One rule of thumb I tell prospective students is that if the school is trying too hard to get you to sign up quick, fast, and in a hurry then the hairs on the back of your neck should stand up.

Finally, there are plenty of people out of work right now.  The Great Recession has claimed professional and trade jobs alike.  It is semi-arrogant to believe that a few college loans and a newly minted piece of paper in hand will make you immune to what is happening globally.  Those of us who are working have had to take paycuts, accept furlough days, have dealt with the disappearance of our retirement contributions, live with roommates, etc.  Everyone is trying to make it work, and no one wants to hear about your “fancy” degree and why it entitles you to anything but the ability to look for a job like everyone else.

I’m not saying it isn’t difficult.  I’m not saying that things aren’t frustrating for those of you who do have thousands of dollars in debt and cannot find work.  However, I am saying that you may have to accept a job in a field you don’t love and doing something that you merely tolerate just until it gets better for all of us.

6 Ways to Save Thousands

Everyone needs to save money these days.  Although it may seem like financial aid will pay for your entire education, student loans must be paid back.  In fact it is easier to walk away from a home loan than a student loan.  So what is a college student to do?  Get creative when it comes to maximizing a minimal budget.  Here are a few tips.

http://www.flickr.com/photos/disneykrayzie/ / CC BY-NC-ND 2.0

1) Learn to cook.

College meal plans are great if you absolutely cannot feed yourself. However, many students do not eat all the meals on their plans and end up wasting money. A meal plan can cost over $2000, so either eat every meal in your plan or learn to cook what you need.

2) Get a job that has dual purposes.

While it may be fun to work for the school’s athletic teams, unless you want to start a career in sports then find a position that matches your needs or work interests. If you can’t cook, then get a job at the cafeteria. You can earn a paycheck and eat! Keep your grades up so that you’re eligible to become a residential advisor. You can save several thousand dollars in room and board, and gain valuable leadership experience. There is a reason that the saying “time is money” is an overworked cliché. Make the most of every hour.

3) Rent or borrow books.

As a college student I stopped buying books after my sophomore year. I got smart and began checking them out from the library. My institution had a consortium agreement with area colleges, and the books that weren’t available from my library I borrowed from other schools. Sometimes a great public library will have the books you need for your humanities classes. Now there are companies such as Chegg.com which will allow you to rent textbooks for about half of their normal cost. If you absolutely must own your books then be sure to check half.com to see if you can buy them cheaper than at your school’s bookstore.

4) Take general education courses at your local community college during the summer.

You may have to pay for these courses yourself, but at prices such as $50 per credit for a three credit course it is worth the investment. Obtain a copy of the catalog of your local college and sit down with your academic advisor to be sure that the classes will transfer over and save yourself not only money, but free up time to explore interesting courses at your university or graduate early and go start earning cash.

5) Move off campus.

If you are at a university that is located in an inexpensive area it may actually be more economical to move off campus with friends than to continue to stay on campus. Living on campus is great for freshmen who need to learn the campus community and meet new people, but once you have established your circle why not save? Keep in mind that you may need to sign a 12-month lease, so be sure you aren’t planning to go home for the summer or have a summer sublet lined up.

6) Buy a refurbished computer.

Many schools are scaling back on the number of computer labs they have, and the hours these labs are open. Also, many classes are now solely online. Instead of buying the latest and greatest machine, consider buying a used laptop or desktop. Craigslist has many deals as tech junkies often want to sell their old computers. Just be sure that whatever you buy is compatible with your university’s systems, and that the computer isn’t damaged in some way.

You may not need all of these techniques, but utilizing one or two could seriously cut your college costs, and allow you to have more income when you begin working instead of handing your whole paycheck over to your loan company!

This post has been cross-posted on higheredlifecoach.com

Commit to an Institution that is Committed to You

The federal government is committed to helping student obtain a formal education.  To this end the feds have made borrowing much easier for many.  Many institutions know that students have guaranteed federal dollars backing their education, and will recruit you as a full-tuition paying student.

Before making a decision to attend an instutition investigate its programs for first-generation students.  Some colleges and universities have special summer courses to help students acclimate themselves to collegiate life.  Other institutions have special residence halls or special orientations for their students.  One of the most valuable tools institutions can provide to is a “first-year experience” program.

First-year experience programs teach students how to access faculty, how to study, choosing a major, and learning to plan your future.  Your first year experience program coordinator  should have continual contact with you throughout your year.

Before agreeing to attend an institution try to meet not only with admissions officers, but also student affairs and faculty.  Discuss with the institution how much scholarship money is available after enrollment.

No one can decide for you which institution is best for you, but asking the above questions can aid you in not regretting your final decision.

Borrowing Part II

The “Washington Monthly” just published an article regarding what happens to some ill informed students who get caught in the borrowing trap.  It’s worth repeating that not all student loans are the same.  While Federal loans come with low interest rates, private loans do not, and sometimes skyrocket into double digits.  It’s also worth stating that your college may not be upfront with you.  Here is what Stephen Burd says:

Each year, more than two million Americans enroll in for-profit colleges, also known as proprietary schools, and their popularity has only grown since the financial crisis. While traditional four-year colleges are struggling with dwindling student bodies and budget gaps, proprietary schools are reporting record enrollments as the newly unemployed try to retool their skills so they can wade back into the job market. Some of the largest for-profit chains say their numbers have doubled over the last year.

The students who are flocking to these schools are mostly poor and working class, and they rely heavily on student loans to cover tuition. According to a College Board analysis of Department of Education data, 60 percent of bachelor’s degree recipients at for-profit colleges graduate with $30,000 or more in student loans—one and a half times the percentage of those at traditional private colleges and three times more than those at four-year public colleges and universities. Similarly, those who earn two-year degrees from proprietary schools rack up nearly three times as much debt as those at community colleges, which serve a similar student population. Proprietary school students are also much more likely to take on private student loans, which, unlike their federal counterparts, are not guaranteed by the federal government, offer scant consumer protections, and tend to charge astronomical interest—in some cases as high as 20 percent.

Burd’s article can be found here.

Borrowing for College

Borrowing for College

There are many who are fortunate enough to receive full funding for their education.  However, for many of us our educational goals require filling in gaps with student loans.  Student loans can be a worthy investment if you borrow wisely.

Student loans are meant to aid those who cannot pay for college outright.  They provide the enormous opportunity to pursue your educational goals.  The key to using them properly is read the fine print before you sign on the dotted line.

Federal student loans come in three varieties: Perkins, Stafford, and PLUS.  Perkins loans are low-interest loans provided for low-income families.  Stafford loans are also federal loans.  They come in two varieties as well: subsidized and unsubsidized.  Subsidized loans are the best because it means that the government will pay the interest while you’re in school.  An unsubsidized loan accrues interest while you’re in school.  Finally, PLUS loans are funds that your parents may borrow for your education.  Be sure to take advantage of all the fiscal information that your financial aid office has before you accept your loan package.  Financial aid officers are well versed in the various types of loans, and will explain your package to you.

Loans are calculated using a variety of factors including the cost of tuition and room and board, and there are maximum amounts you may borrow depending on your classification-graduate or undergraduate.  It is important to calculate how much money you realistically need before borrowing.

While the idea of receiving a refund check sounds great, you must remember that unless your refund consists of excess scholarship and grant monies that refund is money you’ll have to pay back in the long run.  Is it worth a new pair of shoes if that style is going to cost you 6% interest on top of the original price you paid?  Imagine buying a pair of shoes that cost $200 in 2009.  At 6% interest those shoes will cost you $212 the following year.  $12 may seem like a small amount, but by the end of four years you will be paying on a $248 debt and probably no longer own the shoes you bought.  When you consider that the starting salaries for many new grads are in the high 20k to low 30k range, you’ll regret spending frivolously!  The lesson is to only borrow what you need.  For example, if you live at home, and are not paying rent, then only borrow what you need for tuition and books.

If used properly, student loans are a wise investment, and have helped many people move ahead in life.  Borrow what you need and say no to the rest.  Your financial future will thank you.

Plan Your Work and Work Your Plan

Higher education is not the same as primary or secondary education.  At this level everyone expect you to be an adult who is fully autonomous.  That means you are responsible for everything in your student handbook and syllabi.  These are contracts between you and the institution.  Read them carefully.  As an admissions officer, I have met many a student who is upset because they have a charge on their bill that an institution has stated it will charge, but yet the student was unaware.  You are responsible for checking into how well a school supports its students, how often faculty are available, what type of accreditation the school has, graduation rates, and many other aspects of college life.  Be sure to see the student life office and your advisor if you are unsure.  It is better to ask upfront than to find out down the line.

This story from Inside Higher Education epitomizes why it is important to do your homework: http://www.insidehighered.com/news/2009/09/22/gao

Now that you have decided where you want to go you should make a plan to graduate.  College is definitely a place where you can explore and learn new things, but the end goal is to graduate with letters behind your name.  Leaving college with student loan debt and no degree is wholly a difficult place in which to be.  Or what could be even worse is having the need to borrow extra loan money because you need to complete extra degree requirements.  Planning for your collegiate years can mean different things for different types of students, but there are essentials that can apply to anyone.  Ask yourself: will I need to work while I am in school, and if so will that hamper my progress; what exactly are my degree requirements; how often are my required classes offered; and do my classes meet on days and times that I can arrive on time and ready to work?

College is a marathon of endurance and stamina, and planning out each step of the way will keep you on track to graduate on time!