WASHINGTON - The college application process that dominates senior year for many high school students is always stressful, but this year it's even worse.
A report from the College Board shows that college costs continue to rise far faster than parents' salaries: In-state public schools are pushing $20,000 a year and it costs double that to attend the average private college.
At the same time, college savings account balances have fallen, other costs have risen as many parents face unemployment, debt problems and other financial challenges. And more students than ever are applying for college, providing increased competition for the most coveted seats and scholarship programs.
Feel discouraged yet? Don't be. Instead, remember that there are many, many paths to happiness and success that don't run through Harvard yard or Yale's central campus or even straight through any four-year program.
Go out and talk to folks in their mid 20s, and you'll discover many, many people in great jobs and happy relationships who transferred into (and out of) those top name brand schools, took pre-college breaks, started at community colleges, finished at their state schools or took myriad other routes to their current situations.
So avoid worrying and avoid the stress-spewing mother (you know who she is) who waits for you in the parking lot at all of the soccer games wanting to know how your kid is doing on his apps.
Instead, focus on taking a practical, educated and smart approach to the whole college applications and financial aid process that will get your kid into a college he's happy with and that will give you a payment strategy that won't bankrupt either one of you.
To do that, focus on finances from the start. Here's how:
-- Have your child apply to a broad list of schools, including multiple schools that compete with each other for students. Don't just consider state colleges and universities, because many private schools have larger endowments from which they can make bigger grant awards. When considering the list of schools, don't look only at the academic or social issues, look at their budgets. One new college planning site, www.wisechoice.com , offers students and their families estimates of how much aid they are likely to get from every school they put on their list. They calculate this based on the aid awards the schools have given in the past.
-- Do a rough cut of your family finances. Use the estimated financial aid calculators here to see how much money your family will be expected to contribute to tuition, room, board and expenses. If it's an entirely unrealistic amount, based on what you've got in savings and how much you expect to earn over the next few years, start making alternative plans. These could include lining up other sources of money, such as a home equity line of credit or a loan from Grandma, or they could be alternative academic plans, such as having your child focus on schools that pay large amounts of merit aid, which is based on the student's accomplishments and not on family need.
-- Be ready to get the financial aid numbers in early. Send those aid applications in before the end of January, even if you have to later revise some answers. Schools tend to be more generous with financial aid awards early in the season. Position your 2009 income to be as low as possible before the end of the year is out. That includes deferring any bonuses or extra income you expect to make until 2010, taking tax losses and sending in any extra deductible health-care or tax payments before the end of the year. It could help your family qualify for financial aid for the 2010-2011 school year.
-- Consider lots of alternatives. Community colleges are among the best. Even students who attend top-flight colleges have figured out they can take some of their basic required courses at a local two-year school and save on tuition. Most community colleges have agreements with state university systems; if you get reasonable grades in the first two years of community college you can transfer automatically into the flagship four-year school. That will save you money and give you time to decide on a major and build savings for the last two years. Other alternatives worth considering: Take a year off between high school and college to work and save money; squeeze four years of college into three or three and a half; attend college part time and work full time, or sign up for a four-year combined bachelor's/master's program.
-- Plan to make the investment fit the projected results. A quick glance at Payscale.com (here) will reinforce what you probably already know: Starting salaries for engineers and scientists are a lot higher (roughly $60,000) than they are for liberal arts grads and social workers (under $40,000). And most social workers need to go on to collect their master's degree to progress in their career. While the post-graduate paycheck may not be the most important consideration in a college plan, it is worth looking at in deciding how much debt to get into. Federal student loans do offer special repayment options for people who go into low-paying fields, but if you expect graduate school to be in the future, don't spend every penny on undergraduate school.
(editing by Gunna Dickson)