Making College Affordable

making college affordableThis past week, President Obama released a plan for making college affordable. In a nut shell, the government is going to grade colleges based on graduation rate, employment after graduation, graduate pay, and a few other criteria. The schools that rank highest will get the most funding and in theory, will attract more students while the poorer performing schools will have to step it up or go home. I don’t see how this is a step to making college affordable.

Making College Affordable: Cut Student Loans

My solution to making college affordable is to stop giving out student loans (gasp!!)! You read that right. The more money you make available to people the more they will borrow and use it. Look at the housing crisis. Anyone who had a pulse, even pets, were getting mortgage offers. As a result the demand for housing skyrocketed and prices followed suit. The same thing is happening with higher education. If everyone can get a loan, there will be more demand for college and therefore, prices are going to rise. Heck, if I ran a college, I too would be raising prices all of the time! After all, the government is subsidizing education.

The truth of it all is, and some won’t want to hear this, is that not everyone should go to college. College is not right for everyone. But since society has said “if you want to get ahead, you have to go to college” everyone feels compelled to go to college. Unfortunately, what they don’t tell you is that you won’t succeed just because you have a degree. You still have to work hard to succeed. A college education is not a free ticket to success.

Those that aren’t supposed to be in college in the first place end up dropping out after two years and have $15,000 of debt they wouldn’t have if they simply didn’t go. These students get frustrated because they aren’t there because they want to be, they are there because society tells them they should be there.

Great Jobs Without College

I’m not picking on any single group of people by saying that college isn’t for everyone. It’s just a fact. Some people aren’t made for college and that is perfectly fine. You can earn a good living and not go to college. There are plenty of jobs for electricians, welders and plumbers and those careers can earn good money. I have a friend that is a plumber and he earns $50 per hour! Sure he spends some of his days knee deep in poop, but that is more the exception than it is the rule. Most of the time he is simply installing a new faucet or toilet.

When I look back at my college days, I question whether I should have gone to college. All I’ve ever wanted to do was to start my own business. I think back to the days sitting in my European History class or Religious Studies and day-dreaming about businesses I could start up. Sitting in those classes was a waste of my time and my money. I could have saved up my money after high school, started a business and taken classes at a community college that were specific to business.

Making College Affordable For The Average Person

If you are going to go to college or you really want to go but know the only solution is student loans, think again. You can get through college without financing 100% of your education and saddling yourself with tens of thousands of dollars of debt. Here are a few ideas for you to cut the costs:

Grants and Scholarships

Financial assistance and scholarships could reduce your education costs, and in some cases cover the entire cost. If you are qualified to receive any of these awards, it can save you quite a bit of money. Start off by reaching out to your prospective school to see if they have information on any grants and scholarships. From there, you can begin to research online. But be smart about it. Never pay to apply for a grant or scholarship. If you find one that sounds too good to be true, it probably is.

There are many awards out there for you to try for and many don’t require stellar grades to earn.

Employer Tuition Reimbursement Programs

The best way to know whether your company offers this kind of program to employees is to simply ask. Most of my master’s degree was paid for by my employers. The college I went to even had a payment plan for me since I didn’t get the money from my employer until after the semester.

Just keep in mind that companies that pay for their employees to obtain degrees will expect you to stick around and put that education to good use within the company. My one employer required employees that took part in the tuition reimbursement program to stay around for at least one year after earning their degree.

Go To Community College

There is nothing wrong with community college. Go for 2 years while you work and still live at home. After you finish up those 2 years, transfer to a 4 year college and graduate with a degree and not the debt.

The only catch to this option is to make sure the colleges or universities you are interested in will transfer all of the credits you earned towards a degree. Most will, but it is better to be safe than sorry.

Final Thoughts

The fact is when you give people “free” money (I’m counting student loans as free money since 99.9% of people don’t realize that they are going to have to pay this money back after four years) they are going to take it. Yes, loans are needed to help people attend college and they are key in making college affordable for low income students. But they shouldn’t be THE way people attend college.

Readers, what are your thoughts on making college affordable? Am I completely off-base or is there some truth to this?

8 thoughts on “Making College Affordable”

  1. There is some truth to what you are saying and some truth to what President Obama is saying. Ultimately we need more informed consumers. Most people today assume that college is “good debt.” That once was true but is no longer accurate due to the ever increasing prices of school (triple the rate of inflation over the last 30 years). The ease of getting student loans has limited the markets ability to adjust to this new reality.

    There is no one answer or easy solution. Lots of work needs to be done. I appreciate both you and the President addressing this critical issue.

    1. I agree that there needs to be some combination of ideas to find the right choice. I hate the term “good debt” too. Debt is debt to me. Yes, there are benefits sometimes to going into debt, but it is still debt. I just don’t understand the thought process that taking out student loans, aka good debt, is good because you will be able to earn a higher wage afterwards. At the same time, we are told to not spend money we don’t have. Isn’t that contradictory? There is no guarantee you will land a good paying job after college so taking on the debt under that assumption is flawed.

  2. I find it crazy that teenagers are allowed to make a sometimes six figure decision right out of high school with basically no financial education. That Obama idea will only make bad colleges more expensive but since only a few will get into the best colleges the average debt may raise if people still think college is mandatory.

    1. Maybe there needs to be a test. You have to pass a driving exam to prove you know how to operate a vehicle. Maybe we need to test kids to make sure they understand what they are getting themselves into. I have no idea how that would work, but it’s a thought.

  3. “Not everyone should go to college.” This is so true. It’s been so ingrained in our culture that you must go to college to be successful, but as you’ve pointed out here, it’s actually counterproductive for many who just aren’t cut out for college. Here’s another thing that bothers me: the value of a degree has been watered down considerably. Everyone gets a degree these days with the thousands of colleges around and anyone being able to “afford” going via student loan funding. A large number of these graduates just coast by and don’t really learn anything. Yet, they’ve got a diploma the same as a serious student. It just dumbs it all down.

    1. Great point! When a college degree becomes a “dime a dozen” why increase pay for one person when you can just as easily find another college graduate.

  4. Bryce @ Save and Conquer

    I agree, but the trouble is in the details. How would you implement this? Just turn off the loans? It could be done with federal loans. What about private loans? I suppose the legislature could change the law that says college loans cannot be dismissed in bankruptcy. Then you will have lots of bankruptcies and defaults and eventually no one making loans. I guess that’s one way to get there. Write your congressman.

    1. Yeah, I’m not sure how to implement it but there has to be some sort of formula or something that we can apply to loans. There are a lot of smart people out there, so I’m hoping this can get solved.

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