Families
with college-bound students find themselves slammed by a one-two economic
punch: shrinking household incomes and rising college costs.
As
treasurer for the City of Chicago, I want to help families make the most
important investment they can: an investment in education.
Student
debt has now surpassed credit card debt in the U.S. More than $800 billion is
owed in student loans. The average college senior graduates with $24,000 in
debt, and is facing the bleakest job market in decades. To make matters worse,
student loans cannot be written off due to bankruptcy.
Families
need to navigate the sometimes intimidating paperwork and jargon that can keep
them from getting the help they deserve.
They can
get help from high school counselors, organizations like Ladder Up, The Center
for Economic Progress, and they can get it in English or Spanish.
The first
strategy should be to find any scholarships available for their children: these
could be based on scholastic, musical or athletic abilities. After all, free
money is always better than borrowed money.
The next
step is to explore student grants and low-cost loans. Thousands of dollars in
state, federal and private money is available to students, but these limited
resources run out fast, so time is of the essence. Applications can be filed
anytime after January 1, and should be completed by the end of March.
The
documents required to file for the Free Application for Students Aid are the
same as for tax filing. Every year there are dozens of free events around the
city that combine the two services: tax preparation and the completion of FAFSA
forms. Filing income taxes helps
streamline the financial aid process.
Families
need the help more than ever. At current rates, the cost of a college education
is doubling every 12 to 18 years. That means for students earning a 4-year
degree the last year of college can cost 25 percent more than the first!
In the
past, five years of college costs have increased by almost 40 percent, while
the median income for families has grown by only 1 percent. Unfortunately, the rising costs are
pushing college out of reach for a growing number of families.
Some of
these families should consider community colleges and vocational schools as
alternatives. They should also be very careful about claims made by for-profit
schools. Many times for profit
colleges and universities exaggerate the value of their degrees and the
opportunities available after graduation.
For more
information log onto www.chicagocitytreasurer.com or www.economicprogress.com.
Remember:
it's your money. Your choice.
Stephanie
Neely is treasurer for the city of Chicago.
