Students owe it to themselves to consider the true cost and the true reward of the educational opportunity before them. It is has been said that borrowing money to pay for school is an “investment” and not debt, but try telling that to the loan services when they send out the monthly bill.
Not only that, but the analysis is rarely about going back to school or not going, but rather about making the best possible choice. It may very well be the case that attending one’s dream school without the aid of scholarships or grants is the best decision, but it might also be true that a secondary opportunity starts to look a lot better when the calculator comes out.
In order to help students make the best possible choice, adhere to the following tips:
- Understand the true cost of the education. Pay very close attention to not only the current COA, but also the inflation rate at that school. Some universities are seeing tuition go up more rapidly than others, so it makes sense to project the cost for the following year (or years) as well as simply looking at the tuition and cost for the first year.
- Carefully calculate the ultimate balance on unsubsidized and private loans. $100,000 in loans is a lot of money, but it is really a lot of money when the interest kicks in immediately and keeps accumulating for the life of a 10-year loan period. Students should make sure to work with the financial aid officers to figure out how much they will ultimately shell out by the time they finish making payments. Any differences in “free money” between school A and B will only become more exaggerated over time
- Be willing to briefly consider the enrollment decision in purely financial terms. It sounds overly rigid to advise this, but considering how romantically and emotionally most students make their decisions, it will help balance things out to take a short period of time to consider this the way an accountant would.
- Avoid falling victim to the “drop in the bucket” mentality. Most grad students find the sticker price of graduate school so shockingly high that they sort of give up before they even get started. Not only does this lead to less-than-careful review of the award letter, lack of effort in contacting the financial aid officer, and a failure to appeal for reconsideration (all points included above), it can also lead to careless spending. A bigger or nicer apartment, a car payment, and a brand new laptop are all very common expenditures for grad students, and while the extra five or ten thousand dollars doesn’t seem like much next to a $140,000 education, that extra spending will absolutely be paid for by the loans with the worst terms and highest interest rates. Those seemingly small items will ultimately cost the student twice as much down the road.
- Doggedly search for outside funding. More common among high school students with parents who see their life savings dwindling away, searching for outside scholarships is often something that slips past graduate school applicants. This is a mistake, as there are a variety of unique scholarships, fellowships, and writing competitions available for graduate students of all stripes. Most top grad programs feature a list of such resources on their websites and there are also both free and pay sites that collate these opportunities.
- Carefully review the financial aid opportunities at every school of interest. This sounds incredibly obvious, but most applicants do not perform a thorough search of each and every scholarship and fellowship offered at the schools to which they are applying. The reason this is so important is that students may actually qualify for something they aren