September means most colleges are back in session for the fall semester.
The fall also can serve as a reminder of the high cost of a college education.
Most students use a combination of financial aid, grants and scholarships. But you can’t always count on getting aid, and cutbacks to academic scholarships such as The Florida Bright Futures Scholarship program have made paying for college tougher.
Over the past decade, the cost of college has gone up about 50 percent. Those increases are finally starting to slow down, but the price is still enough to give anyone sticker shock.
Certified financial planner Ryan O’Leary says the Florida Prepaid plan is one of the most popular ways to save and avoid debt.
“You lock in a price somewhat close to today’s tuition rates and, that way, when your child goes off to college, you won’t have to worry about how much the increase in tuition has occurred,” O’Leary said.
529’s are also popular. Those are investment plans tied to the market, but specifically designated for college expenses.
“Similar to kind of a Roth IRA,” O’Leary said. “You don’t get taxed on the growth.”
The tax savings in these college plans are incentive, but the true dividend is your child’s future earning potential. College student Zach Evling said it’s worth it in the end.
“The payoff is definitely worth it,” Evling said. “I’m going to study mechanical engineering, so I hope to be making $50,000 a year by the time I’m out of here.”
Still, the average student who graduated from college in 2013-2014 left with $29,400 in student loan debt.
According to Collegedata.com, the average cost for tuition and fees at a public college is about $9,000 for in-state residents, $22,000 for out-of-state residents at a public school, and $30,000 at private universities. That doesn’t include housing, meals, books and supplies.