The sticker price of a college is not the only thing you should consider when choosing a post-high school experience. Many students pick the college with the lowest tuition or the largest financial aid package. But, this does not factor in all of the costs of going to college.

How Long Does It Take to Graduate?

One of the things many students don’t consider is that some schools have very high 4 year graduation rates. They offer their courses in such a sequence that allows most students to get done with school in 4 years. A few programs even are designed so students can finish in 3 years.

At other schools, it takes longer than that to graduate for the majority of the students. At many of these schools, students have to take time off work or reduce their class load for financial reasons. But, there is also the frequent problem that the students cannot get the classes they need. Sometimes the classes simply aren’t offered in the right sequence. Other times, not enough seats are available to meet the demand.

When it takes more than 4 years to graduate, students will be paying extra money for tuition and living expenses. There is also the opportunity cost of lost income in the 5th and 6th years and beyond.

What Percentage of the Aid Package is Loans?

Some colleges offer large aid packages to entice students to attend. Unfortunately, many students don’t realize until too late that a large portion of the money comes in the form of loans. While this is aid for right now, it’s not “free” money. When you graduate, you will have to pay this money back.

If you take out $20,000 in loans (the national average for students taking out Stafford Loans), you will be paying $230 a month when you graduate. When you consider that an average English graduate’s entry level salary is $32,000 and he or she actually brings home about $2000 a month after taxes, the cost of the loans can exceed 10 percent of a student’s post-college take home pay.

If you have the choice between two schools and one offers the bulk of the aid in loans while the other provides scholarships, grants, and work study options, consider going to the one that doesn’t require you to borrow. Even if it means passing up a first choice school, you will be glad to not be burdened with student loan debt in the long run.

How High are the Starting Salaries?

Some colleges are known for getting their students into good jobs when they are done with school. For instance, MIT grads’ average starting salary is over $72,000. That justifies the $35,000 a year tuition price tag. But, over the course of a lifetime, Dartmouth grads have proven to make the most money.

State colleges can be a bargain in terms of tuition. But, some of them are also really good in terms of what their graduates can earn as well. For instance, the starting salary for grads from the University of California, Berkeley is almost $60,000. That’s not bad considering that in state tuition is only $9,000. Cal Poly, San Luis Obispo in the heart of the Silicon Valley charges only $3500 to in state students, but the average student makes $57,200 upon graduation.

Your starting salary will also depend on what your major is. Students with degrees in finance, economics, chemical engineering, math, and physics tend to have the highest starting salaries. Liberal arts majors like English, psychology, and history tend to make a lot less right out of college.

Putting the pieces of financing college together is a challenge. But it is important to take all of the factors into consideration so that you can make the best decision for the long run.

Filed under: Scholarships For College

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