While tuition and fees have risen over the last decade at all types of colleges and universities, these costs have gone up the least at two-year schools, according to a recent report by the U.S. Government Accountability Office.
The GAO report also shows certain groups of students shifting toward these lower-tuition two-year schools from four-year schools.
If you’re headed to college, a two-year or in-state option could help you minimize your college costs.
Average Debt From Student Loans up Almost $10,000 Over 10 Years
For the past 10 years, student debt has been persistently on the rise, with student loan debt in particular continuing to steepen. According to a series of reports by the Making Opportunity Affordable project, the average student borrower at a public college or university today owes $17,250 in student loans; 10 years ago, the average borrower attending a public institution graduated owing just $8,000 in student loans, after adjusting for inflation.
If you want to buck the trend and graduate with as little debt as possible, you may be able to minimize your need for student loans by keeping your tuition costs low with a two-year school.
More Students Choosing Affordable College Options
The GAO report reveals that the majority of current college students attend institutions that have the lowest average tuition and fees.
Nearly half of all college students in 2006–07 attended institutions where the average in-state tuition and fees were less than $2,550 a year. Three out of five students attended institutions where annual tuition and fees were less than $5,000.
Only 3% of students attended schools where tuition and fees exceeded $25,000 a year.
Community College: Two Years of Big Savings
By attending a community college for your first two years of school, you could save, on average, anywhere from $3,000 to $19,000 a year in tuition and fees.
The College Board, in its 2006 Trends in College Pricing report, shows tuition and fees at public two-year schools averaging a little less than $3,000 a year. Annual tuition and fees at public four-year institutions, on the other hand, average almost $6,000 a year for in-state students; at private four-year institutions, average tuition and fees are more than $22,000 a year.
When you transfer from a two-year school to a four-year school, you can still graduate with a diploma from the four-year school where you choose to finish up your last two years of study, but you’d only have to pay two years’ worth of four-year-school tuition.
A significant percentage of students are choosing this two-year option. According to the GAO, 43 percent of non-Hispanic White students are enrolled in two-year schools, as are 50 percent of Black and Asian/Pacific Islander students and nearly 60 percent of all Hispanic students. Hispanic and Black students are actually gravitating more toward two-year schools, with Hispanic and Black enrollment up at two-year schools but on the decline at four-year public colleges.
In-State Schools Could Cut 30% Off Your Tuition Costs
Besides cutting your first two years of college expenses by attending a community college, you could continue to save and minimize your need for student loans by choosing an in-state public college or university for your final two years and taking advantage of in-state tuition rates.
The College Board shows out-of-state tuition and fees at four-year public institutions averaging almost $16,000 a year, compared to the $6,000 annual average for in-state tuition and fees — that means that by choosing an in-state school, you could save an average of $10,000 a year in tuition and fees alone.
Scholarships: FREE Money for School
Wherever you choose to go, make it a point to dedicate a significant amount of time to searching for scholarships and grants. There are millions of dollars in scholarships and grants available each year, both with and without regard to your financial situation, and these awards are money that you’ll never have to pay back. You can often use scholarships to reduce your need for federal or private student loans.
Online scholarship databases can help you in your scholarship search, especially if you’re not quite sure where to start. The NextStudent Scholarship Search Engine, for instance, lists over 5.9 million individually awarded scholarships worth over $16 billion, and is completely free to use.
Federal Financial Aid
When scholarships don’t cover all your college tuition costs, make sure you look into all your available federal financial aid options. In order to qualify for need-based financial aid like federal Pell grants, work-study, and low-interest Perkins student loans and subsidized Stafford student loans, you’ll need to submit your Free Application for Federal Student Aid (FAFSA) each year.
Even if you don’t qualify for need-based aid, there are low-interest non–need-based federal college loans, such as unsubsidized Stafford student loans and fixed-rate PLUS loans for parents of undergraduates.
Private Student Loans
If your education-related costs exceed your available grants, scholarships, and federal student loans, you may still be able to get the additional financial aid you need from non–need-based private student loans.
But remember: Federal student loans generally offer more attractive terms than private student loans, so you should always look into your federal financing options first.
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