Many of you have heard at least one of the “boot-strap” stories where someone in the family or someone we know worked 40 plus hours a week to pay their way through college, all while taking a full-time load of classes. Or, perhaps you have heard the stories of the student who took a year or two off after high school to earn the money to pay for college.
These are great stories. But, in today’s world of high cost of living prices and high tuition, these stories have become more faerie tale than fact. Especially since minimum wage, the hourly wage rate most students who have just graduated high school and entered the world of work are earning, has not kept up with inflation.
Having a difficult time with this? That’s okay. Many parents still think their student will be able to work and manage full-time educational costs all at the same time. Maybe a more concrete example will help you see the impact this really has on a student financially.
Meet Joe College. He’s a recent high school graduate with few marketable skills. He’s more than willing to work to pay for college, but the only jobs he’s been offered are part-time and pay $5.85 per hour (the federal minimum wage for 2007-08). If Joe works two part-time jobs (equivalent to a 40 hour week), he’ll earn about $200 a week (after taxes and other withholdings). Joe’s parents cannot make much of a financial contribution towards his college. They still have two other children at home to support. They will keep Joe on their medical insurance; but, after all is said and done, really only have about $ 3,000 they can contribute towards Joe’s educational costs for the year.
Joe has a few other problems, though. He is attending a public university, so his tuition and fee costs are not that high, but he has to live on campus because mom and dad are relocating for work. This means he has to pay for both room and board (housing and a food plan). He also has to purchase and maintain a vehicle (for work and other travel) because local public transportation is unreliable.
Here’s what Joe’s annual budget might look like, if he manages to work all year and does not take any time off to study for exams, to recover from sickness, or to celebrate holidays or vacation:
CASH IN
Income from Work $10,400
Parental Contribution $ 3,000
TOTAL $13,400
CASH OUT
Tuition/Fees $ 6,185
Books/Supplies $ 988
Room/Board $ 7,404
Transportation $ 911
Other Expenses $ 1,848
TOTAL $17,336
As you can see, Joe has more cash going out than he has coming in. Even working full-time and counting the money from his parents, Joe is still short almost $4,000 for the year. Sure, he could try to cut corners on transportation (but not by much considering the upwards trend in gas prices) and other expenses; but just the cost of tuition/fees, books/supplies, and room/board alone will exceed the cash he can anticipate coming in for the year.
The real world for many students looks a lot like it does for Joe. There’s simply no way, as recent high school graduates, they are going to be able to pay for college or university on their own. Thankfully, if they start planning for college expenses early and apply for financial aid, they usually do not have to.
Until next time!
Lynn Byrne
Preparing for college admissions? Trying to find direction? Need a little help with the planning? Check out my college planning series:
- College Planning Made Easy--the planning and preparation workbook for the take charge, college-bound student,
- Paying for College Made Easy--a college financing guide designed to assist students and families in preparing and planning for higher education expenses; and
- The Great Scholarship Search--my guide for students and parents researching and applying for scholarship funding.
