The average cost of a college education increases every year, and is expected to continue doing so in coming years. However, the benefits of obtaining a college education far exceed the costs.
An October 26, 2006 U.S. Census Bureau report states that in 2004, people with only a high school diploma had average annual earnings of $28,645, while adults with a bachelor’s degree raked in an average of $51,554.
With the prospect of significantly higher lifetime earnings made possible by a college degree, it is easy to see why so many Americans are willing to make the investment despite the soaring cost of college.
As students enter college and take the first step toward a promising financial future, they are also faced with budgeting for the hidden fees and costs that will inevitably arise.
When it comes to funding a college education, whether it is through a grant, student loan, or income, paying tuition is just the beginning.
Budgeting for these hidden costs will help you avoid financially straining surprises along the way:
-Textbooks and other necessary supplies. The price of textbooks can be summed up in one word: expensive. It is not uncommon for students to spend $400 and up for the books they need for one semester, so failing to plan for such costs is a major mistake. Adding to the cost, some classes require materials in addition to textbooks, such as a portable memory drive, a specific calculator, art supplies and the like. These costs are of course in addition to the basics you will need to have on hand at all times–notebook paper, pens and pencils, notebooks and binders.
-Deposits and start up fees for services. If you are moving into a new apartment or house, there will likely be deposits and other initial fees to begin utility services such as electricity, water, cable and telephone, all in addition to the deposit for leasing the residence. Speak with utility providers in advance to determine exactly what fees you will owe and when. If needed, inquire about payment options; some utility companies are willing to divide start up fees over a couple of months to make deposits more affordable.
-Your own upkeep. So you have allowed funds for food in your budget, great! But there are other costs associated with college living that many new students neglect to consider, such as laundry. If you will be using a common laundry facility, all those quarters can really add up! Also consider the cost for items such as toothpaste, shampoo, soap, razors, and any other items that you will purchase on a regular basis.
-Entertainment. Let’s face it–for most students, being in college is not just about academics. As long as your other bases are covered, allow some room in your budget for pleasure. Concerts, movies and other social temptations will inevitably arise, and allowing for them in your budget is a good way to avoid spending money that is designated for something else, like food.
In college or not, being confronted with unexpected expenses is a part of life. The benefits of having an emergency fund to which you contribute on a regular basis cannot be overemphasized. Smart financial decisions, such as developing a thorough budget that accounts for hidden costs and saving for unexpected expenses, will put you on track to enjoy the enduring financial benefits that arise from a college education.
About the Author
Edmund Rogers, a graduate student in English, is the editor for iStudentLoan.com, a student loan and student loan consolidation provider which also supplies a free online resource for learning about and applying for a student loan. For more information, please visit http://www.iStudentLoan.com Edmund Rogers may be contacted there.
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