By Alan Haskvitz

“Does college pay?  They do if you are a good open-field runner.”  ~Will Rogers

With university expenses rising, it can now cost from $50,000 to $200,000 to earn a bachelor’s degree in four years.  That’s the good news.  The bad news is that only 47 percent of students finish at the same college where they started and only 54 percent finish in six years. Add to that the fact that half of all graduates owe $20,000 in loans after the sheepskin arrives, and there clearly is a need to for some money-saving tips.

Prepare and accept challenges 

First -- start planning early, take tough classes, and do your homework. Only 30 percent of families start saving for college before high school graduation.  Make college planning a family affair. The selection of middle and high school classes can impact college admission privileges and merit-based financial aid.

The most overlooked tip is making sure a student is taking the most challenging courses in middle school. Admissions officers don’t care if a child had straight As in eighth grade. What counts are high school accomplishments. So carefully select middle school teachers and classes with the future in mind, taking the classes and teachers most likely to help prepare for high school. Such courses as computer technology, typing, language arts and social studies courses that stress research, writing and using a variety of resources set the tone for the challenge of high school.

Take the most demanding curriculum in high school. Social life aside, working hard these four years can make a substantial difference in future earnings. The average college graduate earns 100 percent more than those that didn’t go on to university.

The simple flip of a high schooler’s graduation tassel represents both a rite of passage and the potential loss of thousands of dollars in savings if the student takes Advanced Placement or International Baccalaureate courses. These classes may count for university credit and save considerably on tuition. They can also prepare you for the PSAT examination. A student who does well on this test may become a National Merit Award Winner.  This designation means the student can get into their school of choice and will receive a small scholarship. Taking a rigorous course of study also helps prepare for college entrance tests.

Get the facts about entrance exams

Thirdly, take both the ACT and the SAT tests if you can afford it, but first check with your universities of choice.  Many colleges will accept the test with the highest score; families often get caught up in the belief that the SAT is the only one that counts. That is not true. Both examinations are given even weight, even with their differences. The SAT is more oriented to problem solving and essay writing, and the ACT is more curriculum based.  If you can afford just one test, check with your high school counselor to see which test might yield the best scores.  If you cannot afford the cost, you can get a fee waiver.
After deciding which test to take, the student should practice taking the test online and review books that have sample questions.  Consider the many tutoring services as well.  Being familiar with the test reduces the pressure.  The results of either of these tests are one of the major elements in college admissions and can yield scholarships when combined with good grades and community involvement.  Of course, if the prospective student is a good open field runner, the scores may not be as relevant.  (Finding College Scholarships)
This is also a good time to start exploring colleges, even planning family trips to visit the institutions.  If a state university is selected, you can save considerably.  Attending a public college in a different state could triple tuition costs, not to mention add travel expenses. If an out-of-state institution is of interest, check for reciprocity agreements to reduce the cost, such as the one at Minnesota.  For those in a good financial position, buying a condo for a student to live in, rather then paying rent, is a consideration.  And, the mortgage payment is tax deductible.

Learn about financial aid options

Fourth, figure out your Expected Family Contribution (EFC).  The university uses this figure to decide the amount the parent is capable of paying for a student’s education. Online forms are available to do this, but have all your financial information at hand. These forms are frequently audited. Hint.
Expected Family Contribution Calculator

Next, become very familiar with the government’s Free Application for Federal Student Aid site (FAFSA).  Financial aid awards are based on income reported the previous year.  As such, if you can postpone capital gains and save money for college in your name, so much the better. Be aware that saving money in your child’s name brings a new set of percentages into the financial aid calculations. Universities expect the student to pay a higher proportion of their savings to attend than the parent.  Pay down the student’s assets first, and it is a good idea to ask grandparents and others not to give students money for college as it is considered income.

Each school has different requirements and some, such as Pomona College, want additional forms to determine the amount of aid an incoming candidate may qualify for.  Thus it is vital for a family to consider and document all expenses.  For example, parents might consider going back to school themselves to finish a degree as having more than one family member in college increases the possibility of more aid.  Always look to reduce your available cash by paying off debts or buying that new home entertainment center.  Don’t forget to add to your retirement account as this reduces your “kiddie tax” liabilities when the college calculates how much you can afford to pay.  Also consider prepaying your mortgage.  Make sure you don’t take money from your retirement to pay for college, borrow from it instead.  And consider reducing large amounts of money in a bank account or mutual fund as they also count against you in determining financial aid.

Since 14 percent of the readership’s population is in the pre-college age group, there may be significant interest in starting a Roth IRA, a 529 plan or a Coverdell education savings account. I recommend you check with a financial advisor. The sooner these are started, the more the fiscal advantages. Some parents start these when their children are infants as the savings are impressive.
National Association of Student Financial Aid Administrators

Contact the university’s financial aid administrator before filing your EFC or your FAFSA.  They are there to help and can provide invaluable assistance on matters you may have missed.  They also have a Professional Judgment option open to them, too, should you have a special circumstance such as selling that movie script for a couple of million dollars. That is why it is important to carefully select the date you submit the FAFSA, as the figures provided and your marital status must be accurate as of that date. Free Application for Federal Student Aid

If you need a loan, the most cost effective are the federal Stafford, Perkins, and Federal Parent PLUS loans.  The rates for the student are usually much lower than a parent could get a cut back on school costs considerably. Currently, these rates are in the six percent range. These all must be declared.

Consider a variety of college choices

Sixth, consider enrolling in a community college and then transferring to a four-year university. It may not be as prestigious, but the savings are impressive. The average costs, according to Trends in College Pricing, are $13,126 for students attending two-year public colleges, $17,336 for students attending four-year public colleges and universities, and $35,374 for students at four-year private colleges and universities.  Out-of-state students attending public colleges and universities pay an average total cost of $27,791 per year. Furthermore, research shows students who transfer from a community college earn grades equal to, if not better than, students who begin their college careers at a four-year college or university. If you do take this tip, make sure the courses taken are transferable to the desired university by checking before hand.

Seventh, don’t rule out expensive universities even though state colleges are much less costly. The richer the institution, the more need-based aid is available.  It is possible to pay less to attend an Ivy League school than a state university, and my daughter is proof of that. As an example, if Harvard accepts you for admission and your family income is below $180,000, your annual cost at that school may be capped at 10 percent of your family income. Stanford has a special plan, too.

Here’s the real secret about expensive private schools. The College Board found the "net price" at the average private college in 2006-07 was about $9,000 less than the published price due to tax benefits and institutional and federal grants.  More than $130 billion in financial aid is available with about 66 percent of all students receiving grant aid at the following averages: 

• About $2,040 per student at public two-year colleges,
• About $3,600 at public four-year colleges, and
• About $9,300 per student at private four-year colleges.

Call 1-800-4FED-AID for a student guide to federal financial aid.

Research and apply for scholarships

Eighth, check out local and unusual scholarships. Before you do, make certain of the rules about such awards from your university of choice.  Sometimes they just reduce the amount of student aid when an outside scholarship is earned.

The majority of scholarships and financial aid comes from the government, and your FAFSA filing guides you to these. Next there are a great many local resources. These are usually for smaller amounts, but they are worth pursuing.  Local civic organizations, women’s clubs, minority groups, memorial scholarships, all start with the high school guidance officers. They have categorical listings that include religious and ethnic groups, unions and professional organizations.  Corporations, such as Coca-Cola and Target, also provide help.

An abundance of scholarships is available, including some truly strange ones such as:

• The Kor Memorial from the Klingon Language Institute,
• The Patrick Kerr Skateboard Scholarship,
• The Who Wants Chocolate $5000 Scholarship,
• The Scholar Athlete Milk Mustache of the Year Award,
• a $1000 scholarship for left-handed students,
• Duck Brand Duct Tape Stuck at Prom Contest ($6000 for the couple with the best attire made of the product), and
• Funds from groups that support Little People, Tall People, Fat People, Skateboarders, Tupperware sellers, Duck Callers, Mule Deer supporters, vegetarians, Pagan and Wicca students, golfers and bowlers.

For a larger list of grants, scholarships and aid go to: Locate, Grants, Scholarships and Awards.

Consider service and work-study options

Ninth, don’t overlook the AmeriCorps or the ROTC. By serving your country at home, as AmeriCorps does, or in the armed forces such as the ROTC, you can reduce the cost of your education. AmeriCorps (1-800-942-2677) is a domestic service organization in which young men and women work on community service projects in exchange for a living allowance averaging $7,500 per year; health care; and an education award of $4,725 per year for repaying a student loan or for financing postsecondary education. Under some circumstances, a person can serve part time and receive an education award of $2,362 per year.  The ROTC offers scholarships for those who meet the criteria and agree to accept a commission and serve in the Army on active duty or in a Reserve unit. 

Tenth, student aid comes in a variety of forms, including some very interesting scholarships. Start with government search sites first.  Don’t be dismayed because this is one search that isn’t limited.  But remember to:  apply early and read the requirements.  If an essay is required, make it unique to you and not the store-bought variety.  Stay positive, be aware most scholarship deadlines are between January and May, and proofread all your work.  Financial Aid and Scholarship Wizard

Many colleges also offer a work-study program that can be part of a student’s financial aid package. The student works on campus doing a variety of tasks.  And many colleges offer merit-based grants and scholarships not related to need, but achievement. This can be for academics, athletics, artistic talents or whatever the university feels deserving.

Need-based family financial aid is the most complicated due to the many variables from family income to savings to assets to number of children in the family and more.  To qualify for federal or state aid requires some homework. And help can come in a variety of forms such as tax credits, tax deductions or tax breaks on savings plans.  These latter are not the same as student aid, but can make college more affordable by reducing taxes. The Hope Scholarship tax credit can provide up to $1,500 for a child's first and second years of college, and the Lifetime Learning tax credit can provide as much as $1,000 a year after the first two years of college.

Seek help and don’t delay

Reducing college costs is best done with professional help from a financial advisor, school counselor or federal government help sites.  Failure to do your homework could cost thousands of dollars in aid and make your college of choice too expensive. Of course, having a student who can throw a 100 mph fastball or who has an overpowering serve could make everything a bit easier.

A final tip – don’t miss deadlines.  You are going to need letters of recommendation, completed applications, transcripts and essays that honor due dates. Failure to meet timetables could be costly and mean not being admitted to your school of choice -- not to mention the fun of more time at home.