Who Should Pay For College?

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College, Campus, University, Boston, Law School

(credit: Photo by Darren McCollester/Newsmakers)

420x316-grad-lee Dee Lee
Dee Lee is a Certified Financial Planner who received a diploma in...
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BOSTON (CBS) – SATs were given last Saturday. And of the 1.5 million kids who take the PSATs in their junior year, only about 8,000 qualify for a merit scholarship. So if your kid is not acing her SATs how are you going to pay for college?

Harvard’s tuition for this year is almost $39,000 ($38,891) and the room and board is over $14,000 ($14,115). And then you add up the fees, health care, books, phone, a computer, midnight pizza runs and travel the cost is about $65,000. Price tag for four years at Harvard $275,000.

The average Massachusetts private college education price tag is cheaper than Harvard coming in at around $160,000 for four years.

Tuition at UMASS for this year is over $13,000 ($13, 258). Another $10,000 ($10,439) for room and board. Add the other stuff in and you are probably looking at a price tag of about $110,000 for four years.

College expenses have averaged an increase of about six percent a year. This year public colleges averaged three percent but last year close to five and the year before that almost nine percent. So I am safe in saying college will be more expensive in the future, so that should be part of your planning.

I do believe an education is a good investment! That investment could be worth well over a $1 million dollars to the kiddo. That’s the average pay difference over a working career between having a high school diploma compared to a college degree.

But the investment is in the kid so they should be part of the planning and the paying. And when getting that degree they should consider a marketable degree, something that will get them a job upon graduation.

Kids need to be a part of this process. And they should have a job over the summer to earn money for school. They can easily be responsible for their spending money, clothes, entertainment, books and some of the fees depending on the job they have.

One more thing: If a kid is really bright and wants to go to Harvard there may be enough aid offered to make it cheaper than sending the kid to a state college.

Resources: According to The College Board® the ten-year historical rate of increase is approximately 6 percent. These figures are substantially higher than the general inflation rate. They are also higher than the average increase in personal incomes.

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