Tuesday, February 23, 2010
BY GERALD M. BRADSHAW
gerald_bradshaw@post.harvard.edu
Bradshaw College Consulting
219-781-2372
Dear Mr. Bradshaw -- As a parent, I worry about the high cost of tuition to attend a private college. The more I look into schools like Butler University or Boston College, the more I realize they are out of my price range.
I know financial aid is available, but I don't want my son to end up graduating with thousands of dollars in student loans. And I don't want to end up paying them off with my Social Security check.
We can afford to pay for a public college education without going into debt. If we don't want to go into debt, does this mean a private college is out of the question?
He's a great student and did well on his SAT, which you constantly stress is important, scoring 680-720 on each test. I hope you have a solution. A lot of our friends are in the same situation -- An Average Parent
Dear Average Parent -- Yes, there is a way to attend a private college without going into debt. The key is the amount of time you are willing to spend searching for the right college.
As you said, Boston College and Butler are expensive, with estimated annual costs of $45,000 to $60,000. Plus, the cost of living in Boston is much higher than Indianapolis.
Financial aid is available at both schools, but under each program, students must be prepared to take out loans as part of the overall package.
From the description of your son's outstanding academic numbers, he is qualified to apply to what are called no-loan colleges. Several colleges have dropped loans as part of their financial aid packages and have replaced them with direct grants and scholarships that do not have to be repaid.
Amherst College, the University of North Carolina, and Davidson College maintain no-loan policies as part of their financial aid offerings, along with Princeton, Yale and Stanford. In other words, if your son gets admitted to a no-loan college, officials there will make it easier for him to attend without going into debt.
The general rule is, families making less than $60,000 a year aren't required to pay anything toward their children's educations.
Families making up to $160,000 per year pay only 10 percent of their gross income.
Most of these colleges do not count home equity when computing aid, although families having assets unusually large for their income levels may see the amount of aid they receive reduced.
Children, regardless of family income levels, will be expected to make a contribution to their educations, but that number is typically small and funded by work-study jobs of fewer than 10 hours per week.
Haverford College, a top liberal arts school in Pennsylvania, is typical of no-loan financial aid colleges. It is very selective; only 27 percent of applicants get in, the same percentage as Notre Dame.
A word of caution: Most top colleges began no-loan policies at the peak of their endowment performances, when they were growing at a rate of 20 percent per year. There is no guarantee they will continue their charitable policies in the wake of the recession. Williams College revoked its no-loan financial aid policy earlier this month after losing $500 million the last three years.
More than 50 schools have some form of no-loan or loan-limit policy for financial aid recipients. Check out The Project on Student Debt at www.projectonstudentdebt.org for a listing.
Gerald Bradshaw of Crown Point consults with students on how to gain admission to selective prep schools, colleges, universities and law schools.
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