You can Afford to go to College
Putting Education Costs into Perspective
The cost of attending college may seem daunting at first; by comparing that cost against the benefits of a college education some of your fears will be diminished.
With many of today’s headlines concentrating on the evils of debt; it is only natural that a person would feel hesitant about taking on excess loans to foot that large school bill. Unfortunately with ever-increasing college tuition and living expenses, not everyone is able to rely on their parents to pay for their entire education.
Scholarships are also a wonderful alternative to taking on the debt of school loans however, finding and qualifying for a sufficient amount in scholarships to pay for 100% of your tuition and other expenses is difficult. Due to these and other factors, student loans remain among the best alternatives for funding your college education.
The Real Cost of College
Although there are colleges that cost upwards of $25,000 a year for tuition and fees; 63% of students are attending colleges that cost less than $9,000 a year (College Board, 2006). Even allowing for an upward trend in college costs; it will cost a student that graduates from a public college in four years less than $40,000 in tuition and fees. That may sound like a huge amount of money, especially if you are just graduating from high school. However to put that number in perspective, the average price of a new car in 2005 was $28,400 (NADA, 2006). The long-term benefits of college are certainly greater than that of owning a brand-new car; the average college graduate with a bachelor’s degree earns $1,000,000 more during his or her lifetime than the average high school graduate (Education Pays, 2006).
Student Loans
Not only will you gain more benefit from your college education than you would a new car, the interest will likely be far less as well. Stafford loans are the most common student loan and like most student loans; they do not require any form of credit to qualify for. Many college loans are subsidized, meaning the government will pay your interest while you are in school. Chances are you will have to get some unsubsidized loans as well. Although the government does not pay the interest on these loans, you will not have to pay it until you graduate and start repaying the principal of your loans.
The interest rate on Stafford loans and most student loans in general is low; it is a fair tradeoff for the likely benefit to your lifetime salary. Student loans also offer the benefit of offering flexible payment arrangements; you can even defer your student loans for an extended period of time if you are trying to find employment.
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Pay for College with Federal Loans
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