Education Archives — Beating Broke

Beware These Financial Pitfalls When Choosing a College

August 23, 2021 By MelissaB Leave a Comment

With more and more high school students deciding to attend college, the race to find the “perfect” college often begins as early as a high school student’s sophomore year, though more typically their junior year. Students may consider a school’s “vibe,” and its ranking when picking a college, but there are more important things to consider. As the parent, stepping into your child’s college search with a dose of reality is necessary. After all, attending college can cost tens of thousands of dollars. Advise your child to beware of these financial pitfalls when choosing a college.

Financial Pitfalls When Choosing a College

College is expensive! Even if your child attends a local university and lives on campus, the price tag could be $20,000 per year or more. For that kind of investment, you should carefully consider these factors, which will save you money and help you and your child choose the right college carefully.

The Retention Rate

How many students who come in as freshmen come back for their sophomore year? That is the college’s retention rate. Colleges with high retention rates are likely doing something right for their students. If the college your child is considering has a low retention rate, be concerned.

Transferring to a different college because your child is unhappy at the one she initially chose can be expensive. Not all of your child’s credits may transfer, which means she may have to pay more to complete her college degree, which happened to me. I left my initial college after one semester. It ultimately took me five years to graduate college, in part because of the college I initially chose and the fact that some credits didn’t transfer.

The average retention rate nationwide is 78%. If the college your child wants to attend is lower than that, make sure you understand why before sending your child.

The Graduation Rate

How likely are incoming freshmen to graduate in four years? That is the graduation rate. Unfortunately, the nationwide graduation rate is surprisingly low. “According to the National Center for Education Statistics, just 41% of first-time full-time college students earn a bachelor’s degree in four years, and only 59% earn a bachelor’s in six years” (CNBC).

What do those lower graduation rates represent?

First, some students drop out and never complete their degrees. My cousin dropped out of law school after one year, and he had tens of thousands of dollars of debt to show for it without the law degree. He did eventually get his Master’s in a different field, but paying off the law school loans took him years. This is the worst-case scenario.

Second, if your child does graduate but takes five or six years to do so, your child is in a better position—he has his degree. However, do you have the money to pay for an additional one or two years of college? Most families expect their child to graduate in four years and budget for that. When graduating takes longer, many families are left taking out additional loans they hadn’t planned on. Unfortunately, this scenario is surprisingly common as most schools have fairly low four-year graduation rates.

Some Scholarships Aren’t Renewable

If your child qualifies for financial aid, be forewarned that the college can usually manipulate the first-year financial-aid package to make attending the school possible. However, they often do that by finding scholarships the college offers. Yet, what you may not realize is that some of these scholarships aren’t renewable.

Perhaps for the first year of college, parents need to pay $7,000. However, for sophomore year, after some of these one-time scholarships end, you may be looking at a bill of $15,000 a year. Can you afford that if you were expecting to pay just $7,000 a year? That can be a shock to many parents.

Make sure when you sign your financial aid agreement that you know which scholarships are renewable and which are one-time scholarships so you’re not surprised next year.

Paying for College Can Increase Your Income

Some parents choose to pay for college by taking money out of their retirement accounts. However, when they do this, the money they withdraw counts as income in the next tax return that they file. Then, when the college sees this, they see that the parents’ income has gone up, and financial aid is further reduced.

Ideally, have a way to pay for college that won’t make your income increase and reduce the amount of financial aid for which you qualify. If you feel that taking money out of your retirement fund is the only way to pay, consider choosing another college. Or, choose to take out PLUS loans and either pay them back traditionally or pay them back with money from your retirement fund after your child graduates. Then, doing so won’t affect your financial aid offer.

Consider Living Expenses

When people think of the price of college, they most often consider tuition and room and board. However, your child will have many more expenses than that. Consider the following additional costs students may incur:

travel home for vacations,
clothing if the climate at school is different from the climate at home,
entertainment,
food when the college cafeteria is closed,
fraternity or sorority fees if they are pledging,
laundry,
parking fees,
summer storage for their college furniture and other goods when they are home on summer break

Final Thoughts

Choosing a college can be exciting, but make sure your child isn’t swayed by the college’s slick advertising. More importantly, consider the many financial pitfalls when choosing a college. Investigate the college’s retention and graduation rates. Understand your financial aid package, especially if the scholarships that your child receives are renewable or one-time scholarships. Don’t forget to also account for living expenses. If you consider all of these variables, you will be more financially prepared for what is to come in the next four (or six!) years your child is a college student.

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4 Side Hustles for Teachers

April 15, 2019 By MelissaB Leave a Comment

If you’re currently a teacher, you likely know that while this occupation can be rewarding, it doesn’t pay very well. You may be looking to supplement your income in the evenings or the weekend.

If you’re a former teacher who is now staying home with your kids, you may be looking for a way to bring in money utilizing your teaching skills. However, you’ll need flexibility so that you can do your work when your children are sleeping at night or napping.

Luckily, there are plenty of ways to earn a side gig with your skills as a teacher.

Private Tutor

Teacher Hustles — Make Money as a Teacher

One of my friends worked at Nielsen, became a high school math teacher, and then stayed home when she had children. For the last 10 years, she has been a private math tutor. She gets her clients from referrals from her former colleagues and through word of mouth thanks to satisfied customers. She makes several hundred dollars a month and enjoys being able to still teach even though she is no longer working full-time.

VIPKID Tutor

If you have a bachelor’s degree, you can get apply for a job at VIPKID teaching children in China how to speak English. Most of the available tutoring hours are very early in the morning or late in the evening when your kids are likely already in bed. You can set your own schedule and decide how many hours you want to work each week.

Depending on your experience, VIPKID may pay up to $22 per hour.

Curriculum Developer

Many former teachers make a nice income developing curriculum and selling it on Teachers Pay Teachers. Other teachers are always looking for quality curriculum material and homeschoolers also take advantage of the site.

Online Teacher for Gifted Students

A number of prestigious colleges such as Johns Hopkins, Duke, and Northwestern offer online classes for gifted children. You can teach here, and the schedule offers flexibility as you can decide what semesters to teach and what classes to teach. You’ll be able to challenge gifted students, and you’ll have students who will likely challenge you, too.

If you don’t want to work with gifted students, you can also look at the many online schools available for K-12 students. You can teach from home, and you may have to have a live course or tutoring once a week. My kids were enrolled in an online school this year, and every time they had a tutoring session or interacted with their teachers, the teachers always worked from home, which provides a great deal of flexibility.

If you’re a teacher looking for extra income, you can see that there are a variety of ways to do that, and this list isn’t exhaustive. Here’s another list of ways to make extra money that’s not focused on teachers, but could certainly apply to teachers. If you’re a teacher who opted to stay home with kids, there are many ways you can work from home using your skills and keeping current so you’ll be able to reenter the teaching workforce should you decide to in the future.

If you’re a teacher or were a teacher, have you found ways to turn your skills into a side gig or part-time income stream? If so, what do you do?

Teen Employment: 4 Questions to Ask Before Your Teenager Takes a Part-Time Job

May 25, 2017 By MelissaB 2 Comments

Working part-time is a rite of passage for many teens. Teen employment can lead to increased independence—new friends at work, extra spending money, money to save, etc. However, teens should think carefully before applying for and taking a job. Ideally, they won’t just by default apply to the local restaurant or fast food restaurant. Instead, they should choose a job that matches their goals and aspirations, if possible.

Before the job search begins, you and your teen should consider these questions:

Teen Jobs Employment — Orig. img. credit: Innovate Impact Media on Flickr

What is your teen’s interest? What is your child interested in and good at? What kind of job could he do that he would enjoy and that wouldn’t feel like a grind after a few months? If he loves animals, maybe he could consider working at a pet store or a dog groomers.

What career is your teen considering? If your child is a junior or senior in high school, she likely has a career choice in mind. If she’s choosing between several, now is the time to learn more and help her narrow down her choices.

When I was a senior, I worked at a vet clinic. I had the opportunity to work with the animals and even observe surgeries. I had been toying with the idea of being a veterinarian, but after a summer at the job, I decided I didn’t want to invest all of the time and money it took to become a vet. The job just wasn’t one I’d enjoy that much.

Ideally, your child’s job can help them discern if this is the right career path for them. If it’s not, you and your child have saved thousands on an education they might not have used in the future.

What is your teen’s temperament? How does your child do under pressure? Is he introverted or extroverted? Jobs available to teens can vary widely. Some jobs will have them interacting with the public regularly while others will not. Choose the job that best fits his temperament.

However, sometimes a good job that doesn’t perfectly fit your child’s temperament can provide learning opportunities, so also consider that a stretch in comfort level isn’t all bad.

Will this job help your child get into college or get a job in his career field? Ultimately, a job should not just give your teen some spending money but also help her get into college or into her career field. The jobs that teens take should be stepping stones into the life that they see for themselves.

Also, don’t be afraid to end the job if it is distracting your child from his ultimate goals. Too often, teens take what looks to be a good job only to be given more work hours than they can handle, which causes their schoolwork to suffer. Getting experience in their chosen field IS important and can help them get a better job later in life, but they also must focus on their studies.

Did you have a job as a teen that helped open doors for you or helped you choose your career field, or did you simply work whatever job was available?