How’s this for irony? Apparently, the same lawmakers engaged in negotiations to reduce our national debt are seriously considering raising that (the debt load) of our most financially vulnerable population — students (college debt already exceeds consumer debt and will likely reach $1 trillion this year). Even more ironic, this comes at a time when more than 50% of new jobs created (or saved) will require at least a college degreee — and at a time when our economy needs more college graduates than ever to stay competitive.
While there’s no certainty that these proposals will be part of the final debt ceiling compromise, in a report yesterday by popular website The Daily Beast, Congress and the White House both put forward new plans that would slash student aid programs, including the elimination of student loan subsidies and additional cuts to the Pell Grant. The proposals, which would make students responsible for paying the interest their loans accrue while they’re still enrolled in college, will save the government about $40 billion over the next 10 years (a relative fraction of the total multi-trillion dollar burden), but can cost our kids as much as $14,000 more than they’re currently paying (that’s a lot more to a middle class college grad).
My take: We’re essentially legislating the legal transfer of the federal government’s debt to our middle class kids — which in and of itself seems abhorent, but what’s more concerning to me, is that these changes are being considered for the next federal budget (for 2012), which leaves forgotten middle class parents with high school students or kids already in college precious little time to prepare!
But I’m a glass half full guy!
So, while 2011 was officially the most difficult year for college applicants ever, with nearly every school seeing an uptick in the sheer number of applicants, it was also one of the most generous on record. The discount rate — the difference between the college sticker prices and what students actually pay, after accounting for financial aid and other non-need inducements — reached an all-time high of 42.4%! In fact, 88% of first-year, full-time students received some sort of tuition discount from the institution they were attending.
Higher education is a business – a big business. There are more than $150 billion worth of potential inducements available to offset the cost of college. Now more than ever, you need to re-stock the odds in your favor by arming yourself with the facts, and learning the rules of today’s college business. If you do so, and act accordingly, you will be in a position to send your child to the college s/he wants at a minimized cost that ensures that no one is burdened with the debilitating downward cycle of student debt.
On August 9th, I’m holding my first ever live Webinar where I’ll be taking your questions and discussing exactly how these legislative and business changes will affect your college admissions and funding plans. During the program, I’ll be going beyond the typical one-size-fits-all, cookie-cutter advice you may have received, and I’ll teach you what’s really happening with college admissions and funding today.
Keep in mind that once again colleges will see a record number of applicants this fall, all of whom will be vying for the same slots, precious merit scholarships and disappearing post-recession grants. Where your child goes to school and equally important, what price they will pay for it — will not just affect four years of their life, but potentially their next 40 years (or more).
Want to tip the scales in your favor by understanding exactly how to find, get accepted to and get a discount for college, then you should register for this event. I have a limited number of lines reserved, so advance registration is a must.
p.s. The 5th Annual ‘College Pete College Tour’ officially kicks off on Monday, July 18th. I’ll be meeting with Admissions Directors and Financial Aid officers at colleges around the country… and blogging about what secrets they share. Check out my Facebook page for my on-site video blogs. First stop: Ithaca, NY.