As is the case with everything else the cost of education has risen greatly. Tuition increases of more than 6% a year are commonplace these days. Just as one example, in 1973 the cost of registration at The University of California (UCLA) was about $200 a quarter while today it is well over $2,000 a quarter.
That tenfold increase is not at all unusual and lots of things now cost ten times more than they did back in the 1970s. By contrast, wages have increased about three times in the same time period from about $15,000 - $30,000 a year to about $39,000 - $42,000 a year. These numbers vary according to gender, age and more although as a rough guide a three times increase is about right.
Luckily there is some good news. There are far more forms of financial aid available now to both parents and students than there has ever been. As its name suggests, financial assistance is money which parents and students get from grants, loans and scholarships granted by both Federal and private lenders to assist students to pay for their education.
A few years ago, students depended almost totally on Stafford loans and Pell grants to finance their education costs and living expenses. Today Pell grants are still issued although they are needs based and meet a very small percentage of the education cost today. Stafford loans are similarly needs based but can range from 25% to 40% of the average cost of financing school today. Another type of aid is Perkins loans that are similar to Stafford loans but that are reserved for the lowest income families.
Happily, PLUS loans are also available these days and these loans were not around 25 years ago. These are loans provided for parents rather than students to help parents to pay for their child's education. Interest rates on PLUS loans are reasonable and there are certain restrictions and fees levied but they often form an important part of the student's overall package of funding.
A word to the wise on fees. A lot of loans are for a specific amount of money such as $6,000 a year disbursed in several payments (typically one payment each semester). However it is common for up to 4% in fees to be taken from that amount before the funds are disbursed. This 4% fee on a $6,000 equates to $240 that you will never see but that you must repay. If you are looking for a loan make sure that you do your homework and look for a low-fee or no-fee loan.
Though Federal loan programs like the subsidized Stafford loan program carry low fees and the government pays the interest, they are not the only source of financial assistance today and are not always the best option.
Meeting the cost of college today is a complicated undertaking and the majority of students will need to assemble a funding package that includes scholarships, grants, Federal loans and private financing.
Happily, there are now far more sources of finance available than ever before and market competition between private financial institutions especially means that you can get funds at a price that is not going to break the bank.
It is also fortunate that you live at a time when getting hold of the information that you need to make sensible decisions about the choices available to you is also relatively easy.
Author Resource:-
TheStudentLoansCentre.com provides a wealth of information for students covering everything from an introduction to student loans to a detailed look at student loan refinancing
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