In the Boston University student newspaper yesterday, our dean announced that tuition for next year will increase by 4.2%, bringing the cost of tution here at BU to up around $50,000! I can tell you something, when I told my Dad that news he was extremely happy that I am a senior and will be graduating this May!

In just under 20 years, the average private school rate will be just under $75,000 and the average public school rate will be around $25,000! This is crazy…how do you afford this if you have more than one child, all going into college around the same time?! It worries me a little that I’m already worried about how I am going to pay for my childrens tuitions when I haven’t even graduated my 4 years of college yet!

This rising cost of tuition is becoming more and more frustrating for incoming students. Not only do they want to get into the top universities (many of these private) but they now have to find a way to cover the costs of these expensive schools! From my experience, my family never received any money from the federal direct aid (the money that does not need to be repaid), but we did get student loans (all of which I am now looking to start re-paying when I land a job). The more the cost of tuition continues to rise, the more students are going to have to look for more money in the form of loans!

Not only that, but more students are also holding jobs as well as attending a full course of classes and studying for midterms/finals…you name it! I think it’s hard enough keeping your grades up and have a social life without throwing a job into the mix as well (just to make sure you have some money to spend).

In this day and age, it is almost required that to get an entry level job you have at least a Bachelor’s degree. This burden to get a good job leaves many without a choice and they are almost required to attend a university or college that will land them a job to begin earning a decent salary.

As I am only 2 months away from graduation, I saw the relief on my parents faces that my last amount of tuition is paid off for the semester (just around $18,000) and that my last months rent will be paid for this upcoming April. I am the 3rd child out of my family to graduate from school AND the last one to go! So..I think my parents can finally breathe a sigh of relief, but for many other families and incoming students…the financial journey of tuition, fees, and books is just beginning!

“I have to pay back the interest for the entire 30 year term. Not cool. Learn now so you don’t have to pay later.”

So, its about time start getting those college acceptance letters or to get back to filling out your FAFSAs for the returning students. I’ve learned a few key things that I wish I was told about at the beginning of my college education in order to get the most out of my days on campus. But it doesn’t have anything to do with books, classes, or professors: its all about the financial aid. Here are some tips that I’ve learned that should help save you some money at your higher education.

Haggle: It’s a Business Transaction

So, you got into the school that you wanted but you didn’t get the financial aid package that you are hoping for. I was really afraid to contact my financial aid department because I didn’t want to be told “well, we’re taking back your acceptance.” The first step to being successful in college is to understand that most private schools treat you like a business transaction. So haggle with them. If you have outstanding merits in the field that you are trying to go into, contact the department head or person you interviewed with (if you interviewed) and describe to them why you feel you deserve more financial help. If you can’t make any headway with your department, contact your financial aid advisor and try to describe why you need more financial aid to come to their school. Not all times will they be able to increase your financial aid, but even if they can’t they may be able to point you towards some outside scholarships or subsidized loans offered specifically through the school and its alumni network.

Parent PLUS Loans

Parent PLUS loans are federal loans taken out by your parents, oddly enough, and generally offer you a fixed interest rate. Because it’s a federal loan, your school must approve the amount that you want. On the plus side, (HA) if you are an undergraduate and your parents are denied due to their credit you may be able to get more unsubsidized Stafford Loans. That’s not that bad of a deal.

Shop Around for Interest Rates

Private loan providers vary their interest rates in a very large way. Be sure to specifically discuss if early payment will allow you to accrue less interest, if the interest rate is variable, or if you are able to change repayment terms during the course of the loan. I was stuck in a situation where I thought that I didn’t have the time to shop around: I needed the money and I needed it now. I got a really high interest rate that compounded on the day the loan was disbursed. In other words, regardless of how fast I pay back the principal, I have to pay back the interest for the entire 30 year term. Not cool. Learn now so you don’t have to pay later.

ALWAYS Apply for Aid

A lot of people feel that they or their families make too much money to qualify for financial aid so they don’t fill out their FAFSA (www.fafsa.ed.gov) or other necessary documents. No matter how much money you are worth, you always have a chance to get financial aid. Certain schools calculate your estimated family contribution differently. For example, some schools do not count real estate as an asset to your family. Your school may put money away from alumni scholarships, company sponsorship, or state scholarships that you won’t even know about unless you apply. Don’t lesson your chances, fill out your forms and fill them out early.

Don’t stop here! Listen to the financial aid podcast by reserving a ticket here. Get your questions answered and find out how to save now so you don’t have to pay later.

“As with any major purchase, including student loans, you really owe it to yourself to shop around”.

Once you have student loans, can you transfer them to other lenders for better rates? — this was my number one question for Chris Penn of Student Loan Network and the Financial Aid Podcast.

Bummer news: nope, I can’t. Not since I consolidated my loans. So what about you? You’ve got burning questions, he’s got answers. Find out how you can participate in the first LIVE financial aid podcast. You can even download it into that iPod you bought with that “living expenses” loan. (Actually, no iPod required).

What are the goals of the Student Loan Network and the Financial Aid Podcast?

Student Loan Network is a loan origination and consolidation company, and we’ve been servicing student loans since 1998. We’ve got 25 people on staff and originate more than 200 million in student loans a year. Our goal is to provide competitive loans and basic financial literacy to our borrowers.

Our podcasts started back in April 2005. We have grown into a daily broadcast covering all topics relating to student loans for the millions of Americans who currently have and are in the process of getting student loans. This upcoming podcast is our first “live” call-in show and we encourage people to register for, and participate in, the podcast. It’s free!

A lot of people think they have to use the financial lender their school recommends. But, critics say the schools often get kickbacks from this arrangement and the rates are not necessarily the best options for students. What is your opinion?

No doubt, getting a student loan requires comparing a very complex mix of loan products. There are still some single-lender schools [those that require you only use one specific lender] but this is changing. Hopefully new laws will pass thanks to the negative publicity some major lenders got last year.

As with any major purchase, including student loans, you really owe it to yourself to shop around. You do this using Google and really dig into all the information because the fine print does make a difference. If you decide to be lazy about it and just sign whatever is offered first you can really do yourself a disservice. You can find later you’ve got a “gotcha” moment.

Yeah, I discovered that myself! After consolidating with Sallie Mae I forfeited my ability to move the loans elsewhere!

Exactly.

Should students stick with the “big guys” like Sallie Mae? Or do they have to?

In a case like yours, you have to stay with Sallie Mae. That’s the power of fine print. The best situation to be in is prior to getting your loans. Shop around! Try us, for instance.

What is your opinion of the strategy of paying down part of your loans using 0% credit cards? Is it totally risky, or fiscally savvy?

That depends entirely on the situation. If you have a small amount, say, $1,500 of loans and the money in hand to pay for them, sure — it might be worth it to pay on your 0% card and earn airline points or cash back. But, a Federal Stafford loan is fixed at 6.8%. Few students could qualify for a credit card with interest rates that low. You have to remember that those 0% cards will jump up to 14, 18, even 20% after the initial 0% introductory period. I’d be very, very careful.

How can people tune into your very first, free LIVE podcast?

Call in with your questions on the air and I’ll answer them. If you’d like to be a part of this, please reserve a ticket for yourself here.

Tickets are FREE, but I want to get a better idea of how many people might be calling in, hence the registration.

I’ll be answering questions about the FAFSA, financial aid, student loans, scholarships, and more.

Cool, thanks Chris! I’ll be there and I hope you guys in the Geezeo community with student loans will join me. As a reminder, you can track your student loans on Geezeo. And if you’re interested in podcasts, and making money from them, check out the Geezeo group Podcast Monetization.