photo credit: ycr 

More than likely you know someone graduating high school and heading off to college this fall. After getting over the shock of the first year’s tuition bill, they’ll be in need of some frugal tips to get by while living on campus.

Tuition.

Reduce tuition costs by:
1. Attending a local state school

2. Getting a job at the university and let them foot the bill as most institutions do for full and part time employees

3. Applying for grants specific to your major, merit based, financial need and state based. For example, VA gives a grant for all graduate students in good standing at any accredited university.

Room and Board
1. Apply to be a resident assistant. This is one of the most rewarding positions you’ll have in your college career. Not to mention that it totally wipes out the room and board portion of your tuition bill. The position entails you being responsible for a certain floor or building on campus. You plan activities, programs and on some campuses police the dorm at night by being available should an emergency pop up such as a party getting too wild and residents become intoxicated to the point of alcohol poisoning.

2. Get roommates. If you can tolerate living with multiple people in one room or suite this greatly reduces your tuition bill than if you lived solo on a studio or only had one roommate. I lived with 7 other women before becoming an RA in my freshman year.

3. Get an apartment off-campus. This might require a cost benefit analysis but with the rising cost of room and board across the nation it might be worth it (if your campus lets you do this in your first year) to rent an apartment off campus. I’d probably recommend this to a second and not a first year student as I think freshmen need the guidance and structure of living on campus their first year away from home

Transportation
1. Don’t get a car. Why? You don’t need it. It doesn’t matter if mom and dad are footing the bill, wait until your junior year but in your first year, it’s really just for show unless you have a job that requires the use of a car.

2. Utilize the university transportation system. This includes the on campus shuttles and local buses. Transportation abounds in college towns so this shouldn’t be a huge problem, just familiarize yourself with the times and routes.

Money
1. Open a bank account.

2. Do not accept those silly credit card offers from reps offering you free pens in exchange for credit.

3. Get a part time job. Save 30% of your income unless you have major expenses. A work/study position would be ideal and wish I’d accepted one back in college.

4. Buy your books USED at least 6 weeks before classes begin from Amazon Marketplace, Ebay, Half.com and Abebooks.com

Moving on to this new stage in your life can be daunting at first, not to mention expensive. Save diligently and spend wisely but most of all have fun as you’re now in the bosom of self discovery. You are now beginning what will probably be the best times of your life.

Do you have any advice for students heading off to college for the first time?

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The article, Expecting the Expenses in the Washington Post highlights issues couples should consider when deciding to have children. This is an ongoing debate in our home and the author’s main points resonated with me because we have yet to decide how/if we will be paying for our children’s college education. Here are the some of the main points gleaned from the article:

o If you are planning on having children, save as much money as you can before baby gets here. Kids are expensive, but do I really need to tell you that?

o Look into a short-term-disability policies such as one from Aflac, a secondary insurance provider, to help cover the loss of salaries while the new mom is home taking care of baby

o Increase your withholdings (check with your financial/tax advisor) to help make up for the loss of one salary for a few months

o Create a will. I know its scary to think about this but it must be done. The fact is, should something happen to either parent or God forbid both, you want it very clear what’s to happen and who retains custody of the child.

o Set up a trust.

o Enroll in your employers dependent care savings account. Otherwise known as a health savings plan which allows you to set aside up to $5,000 of your earnings annually, tax-free.

o Decide how you will pay for college. Will you allow your little one to take out loans or do you want to start saving now to pay for college later?

The last point brings us to the issue Mr Latte and I differ on in our approach. Will you save for your child’s education? Or will you just allow them to take out loans? He contends that we should save from now for baby Latte so that they will not have to struggle with paying back student loans upon graduation. I think otherwise. I believe that if our child understands that they will be paying for their own education they will value the experience and education itself more than the child that was sent to college knowing that mom and dad paid for it. I go back and forth on the issue but I would be so hurt if we sacrificed for so many years by saving for their education only to have them blow it all by dropping out or getting ad grades warranting expulsion or something like that.

Furthermore, “you can get a loan for college but you can’t get a loan for retirement“, is pretty self explanatory. I want to be more than just comfortable in retirement because we don’t plan to rely on Social Security. That statement summarizes completely how I feel about the college v. retirement debate in our house. And, while we do pretty well financially I am not sure how we would go about saving for both without making some sacrifices in other areas. I still need to figure that out because I have strong feelings around saving for college and then our kid possibly blowing it all. I haven’t really researched 529 plans or anything of the sort, still trying to revamp the 2008 budget, especially since Mr Latte and I are on schedule for raises.

What’s your stance on the debate? Will you save for college or will you focus on other areas such as retirement? Will you do both?

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