One of the most pernicious financial maladies facing Americans today is college loan debt. At $1.3 trillion--and climbing--it is the second-largest consumer debt burden after mortgages.
This crippling mass loan obligation has gotten so pervasive that it's even following people into retirement. Moreover, student loans are virtually impossible to get rid of unless you pay them off--you generally can't discharge them in bankruptcy.
When I was researching my book, The Debt-Free Degree, I talked to people all over the country who were carrying student debt. Many had fallen behind on their payments, weren't earning enough money to pay off their loans, and were unable to enjoy a debt-free retirement. It's a mostly silent crisis that has crept up on two generations of Americans.
For those already in debt, there are several repayment strategies to consolidate loans or reduce rates. But for those families readying for college, a combination of savings and finding colleges that are likely to offer your student a debt-free degree is the way to go.
Securing a debt-free degree boils down to finding the college that is the best fit and value for the student. In other words, you want a school that will offer the highest-quality education for the lowest cost--ideally, that's a package that will involve little or no debt.
How do you find these colleges?
One simple way is to target the colleges with the richest endowments, those huge pools of cash that can be doled out for financial aid. They are easy enough to find. Lists such as this are published every year that identify them.
On this "richest college" list, you'll find the usual suspects of Ivy League colleges and other elite institutions. Surprisingly, though, you'll also find state colleges such as the University of Michigan, University of Minnesota, University of Washington, and University of Texas-Austin.
Although these schools have money to give, they are often extremely selective. The top-ranked schools typically reject more than 90% of their applicants, and the best packages usually go to the students with the best academic qualifications.
To get in the ballpark for consideration for generous financial aid at the richest schools, the student will need a great grade point average and score on the ACT or SAT.
You can get an idea of what a given school is looking for by reviewing its student profile on College Scorecard, a great online tool that breaks out useful government statistics.
Stanford, for example, has an endowment of more than $20 billion (the third-richest college after Harvard and Yale) and generally accepts students with ACT scores in the 31-34 range (36 is a perfect composite score). Only 13% of Stanford's graduates carry student loans.
While Stanford has an acceptance rate of less than 5%--among the lowest in the world--there are plenty of other endowment-rich colleges such as University of Michigan, Texas A&M, and University of Minnesota that can combine aid with a high-quality education.
Families should also understand how a particular college picks its students. That means learning about enrollment management--the science (and art) of selecting the best-possible students for a given school.
Colleges set up enrollment management programs to sift through the pool of prospective applicants. The goal is to come up with a suitable enrollment from the students in its applicant pool.
"Every college needs to recruit using enrollment management or it will cease to exist,"says Allen Grove, a college admissions expert who also teaches English at Alfred University. This is particularly true for smaller colleges or those with relatively low profiles.
"Enrollment management is much more than software," Grove notes. "It involves all facets of the recruitment process including regional recruiters, admission events, mailings, social media, etc. At many schools, mine included, almost no one pays full price, but some families pay more than others."
How can students improve their odds of being viewed favorably by enrollment managers? Being a superior student, such as a National Merit Scholar, often nets acceptance offers and generous aid packages, notes Grove.
"The ACT and SAT are big factors," Grove says. "A high GPA with a rigorous course load (which may include advanced-placement courses) is also important. Colleges want to see that you've challenged yourself." Taking community college courses during high school is also a plus, Grove notes.
Being an exceptional athlete--in addition to a robust academic record--also plays well in the application process at some schools.
Enrollment managers also want to see a "demonstrated interest" in their colleges, says Grove. College tours, overnight visits and departmental open houses are noted in your application file.
No matter their particular enrollment management program, schools want students who are excited about attending, can succeed, and will fit in well with academic programs and the overall campus climate. If a school your student is interested in offers regional recruitment events, plan to attend. Show up on campus more than once with pointed questions about specific programs.
"College recruitment is a multi-billion-dollar industry," says Grove. As a result, families of college-bound students should be prepared to engage in some focused homework that involves many college visits, essays, interviews, and applications. Ultimately, though, the hard work may be rewarded with a degree that pays dividends for years--and won't leave your family in debt for decades.
By: John F. Wasik (Morning Star).
Photo: Pinterest.
Review: Emerging Market Formulations &
Research Unit, FLAGSHIP RECORDS.
For The #FacebookTeam