It’s that time of year…. March Madness! Time to get your game on sports fans!
At least, that’s what I have heard.
Truth is, I know next to nothing about men’s college basketball. In fact, I probably couldn’t even name four of the 68 men’s college basketball teams participating in the tournament, much less try to predict which teams will make the Final Four.
Apparently, however, it’s a thing.
According to the American Gaming Association, over 40 million Americans will test their sanity as they fill out their brackets and place their bets as to who will win the coveted NCAA men’s basketball tournament. Over $10 billion in bets will be placed on this year’s event before the month is over. Odds of completing a perfect bracket (whatever that means): 1 in 9.2 quintillion. Good luck.
Something I do know. College tuition is insanely expensive.
If you have kids going to college next fall, the real madness begins when you get your college admissions letters and schools tell you how much you will need to fork over to attend their school.
Numbers like $10,000 to $25,000 or more per semester are not uncommon. According to the College Board the average annual cost of tuition and fees at a private college is over $34,000. Add in room and board and you may be looking at total cost of attendance north of $60,000 per year.
Of course, those are just averages. And they don’t take scholarships and other forms of financial aid into consideration. How much you actually pay can vary widely from the so-called sticker price schools publish on their website.
Along with your college acceptance letter you will probably receive a Student Aid Report. The SAR details what your tuition, fees and other expenses will be, as well as the amounts you can expect to receive in scholarships and grants.
Students and parents are often disappointed to learn that their “financial aid package” consists of little more than loans and work-study.
Below are 3 suggestions for parents who get hit with crazy expensive college tuition bills this spring.
First, always, always, always have a plan B, C, and D.
When I work with parents one of the biggest mistakes I see is that they and their student have pinned their college hopes on just one school and haven’t done any research to determine what it will cost or how they will pay for it. If you have narrowed your school choice down to just one college and that college is an expensive school that offers you little to no financial aid, you will have few options other than to pay them their asking price.
The biggest factor that determines how much you pay for college ALWAYS comes down to the school your kid chooses to attend.
For example, state colleges and universities like the University of Michigan, a major contender in the March Madness contest, often come with steep price tags for non-residents.
According to the Net Price Calculator on the school’s website, a non-resident family with a modest income and nothing saved for college would be expected to pay about $53,000 per year to attend Michigan after you factor in financial aid (which in this case includes a $5,500 student loan).
Other schools on your list may offer resident tuition rates, have a lower net cost of attendance or offer more generous financial aid packages.
The same student who gets accepted at the University of MI might qualify for a significant amount of merit-based financial aid many private schools, even if mom and dad have a high income or have saved a lot of money for college. In fact, they could even qualify for significant need-based financial aid at many of the most expensive elite private colleges around the country. And, of course, there is always your home state’s university or college where many families often find the lowest net price.
While a college’s published “sticker price” may be comparable to other schools on your list, the net price difference between one school and another can be as much as $10,000 to $20,000 or more per year.
Always have at least two or three other schools that you can choose from if your first choice is prohibitively expensive.
Second, appeal your financial aid award. Schools that offer merit-based financial aid often have a process for appealing your financial aid award if you feel you still can’t afford to attend that school.
While most schools don’t negotiate price or financial aid, most do work with families on a case-by-case basis. It is generally within their power to increase their financial aid offer, and if they really want your student, often they will.
Typically, the student or her parents write a letter explaining their situation and why they feel the award should be higher. Be sure to include the specifics about your financial situation, why you want to attend that school, and any other relevant information that could help your case.
There is no guarantee that your appeal will get you more financial aid, but a successful appeal could result in about $2,000 or more of additional financial aid per year.
Third, be prepared to say “No”. It hurts even to write that. Who wants to say “no” to their kids after they have worked so hard to get into the school of their choice? Heck, I have a hard time saying “No” to my kids’ requests for shamrock shakes this time of year.
Unfortunately, sometimes the math just doesn’t work out. While a shamrock shake may be in your price range, college tuition at the most expensive schools may not be.
Your kids might hate you for a while, but in the long run they will appreciate not having a mountain of student loan debt to pay off after graduation. Collectively, our kids owe over $1.2 trillion in student loans. In Minnesota the average amount of loan debt per student is $31,915.
What’s more, college tuition for your undergrad is just the tip of the iceberg. Your kids may want to be doctors, lawyers, veterinarians, healthcare workers, teachers, and other professionals. To do that they will need advanced degrees beyond their 4-year bachelor’s degree.
If they spend everything you have and borrow heavily against their future earnings, it’s possible there may be nothing left to spend or borrow if your kid’s go to an expensive stretch school that you and they can ill afford. Saying “no” to a crazy expensive college now, could open the door to other opportunities down the road.
Someday when they are paying next to nothing on their student loans, your kids will thank you.
Oh, for the record, my bets were on South Dakota State to win it all. Even without a national championship, SDSU wins the game of paying less for college with a total cost of attendance that is among the lowest in the country. Even without a D1 basketball scholarship, kids can attend this South Dakota college for less than $20K per year.
Go Jack Rabbits.