About Tom Melecki

40 years experience in the administration of and rule making for postsecondary student financial aid and loan programs. Tom's experience also includes advising students and their parents, providing personal financial management education to college students, research on college students and their finances, and nonprofit management.

Before College: Don’t Let Price Considerations Force Private Schools Off Your List of Potential Colleges — At Least Not Yet!

Anna and Nathan are twins who finished their college freshman year last spring. To protect their institutions, let’s just say that Anna attended University A — a private college receiving no state subsidies — while Nathan enrolled in state-supported public University B.

The total cost — tuition, fees, room, board, books, etc. — for an undergraduate at these universities is vastly different. Last year, it was $52,000 at University A but half that at University B.

Still Anna’s net price — what she and her parents paid after the grants and scholarships she received — was just under $12,000. Nathan’s was a bit above $18,000.

They’re from the same middle-income household, so both qualify for similar federal and state grant amounts. The difference is their scholarships — in this case, institutional scholarships. University A, with a smaller student body but significantly larger endowment, awarded Anna over $30,000 in institutional scholarships. Meanwhile, Nathan got just a $2,500 scholarship from University B. And Universities A and B aren’t the only private and public institutions where these counterintuitive price difference exist.

But there are also well-endowed private colleges and universities whose net prices are much higher than those of their state-supported counterparts. You’ll never know for sure until financial aid offers begin coming in, some of which come as late as next March or April for academic year 2020-21’s prospective freshmen.

The moral is this — don’t cross private universities off your college application list simply because their published total costs are higher than those of public institutions on that list, for private schools may surprise you with large tuition discounts in the form of significant institutional scholarships.

What can you do to improve your chances of winning institutional scholarships at any college or university? Here are some pointers:

  • File Your Free Application for Federal Student Aid (FAFSA) Early: The 2020-21 FAFSA becomes available October 1. Next Wednesday you’ll find out how to prepare to complete and submit it on that day or soon thereafter.
  • File the Institution’s Scholarship Application Form As Soon As Possible: Many colleges use their own scholarship applications to supplement the FAFSA. If so, be thorough but timely in submitting them.
  • Apply to Institutions That Are Good Academic Matches for You: If they’re good for you, you may be the sort of student that’s good for them. Anna, wanted to major in music, and was her high school’s leading pianist. University A’s highly rated music department was seeking talented young pianists, so some of Anna’s institutional scholarship dollars came from that department.

Never pick a school that’s unaffordable or a bad match for you. But right now is to early to narrow your options based on cost!

For more pre-college strategies to help keep the net price of your postsecondary education affordable, contact College Affordability Solutions at (512)366-5354 or at collegeafford@gmail.com.

During and After College: Prepare To Fight for Your Federal Public Service Loan Forgiveness!

The U.S. Education Department (ED) continues to block federal student loan forgiveness for public servants who qualify — i.e. those who’ve faithfully made 10 years of monthly payments toward their Federal Direct Loan Program (FDLP) debts.

Congress authorized the Public Service Loan Forgiveness (PSLF) Program in 2007 to help recruit well-educated millennial replacements for millions of baby boomers scheduled to retire from government and nonprofit jobs. But the Trump administration was running ED by 2017, when qualified borrowers began applying for forgiveness. And Trump’s ED despises PSLF. Last December, its Principal Deputy Undersecretary reportedly said PSLF is a disaster ED doesn’t support.

ED and FedLoan, its PSLF contractor, denied PSLF to thousands. Last year ED’s own statistics showed that 99.5% of PSLF applicants had been rejected. So in 2018 Congress created a fix, authorizing $700 million for a Temporarily Expanded Public Service Loan Forgiveness (TEPSLF) Program. TEPSLF qualifies otherwise eligible public servants for forgiveness after 120 monthly payments made under any FDLP repayment plan, not just certain plans as required by PSLF.

But last week, the non-partisan General Accountability Office (GAO) reported that 99% of TEPSLF applicants had been denied forgiveness. It found that:

  • Over 70% of those who requested TEPSLF by sending FedLoan the emails it requires didn’t attach their PSLF Forgiveness Applications or PSLF Employment Certification Forms. There’s so much confusion surrounding these forms that it’s clear applicants aren’t well-informed about them;
  • 12% of TEPSLF denials were because borrowers hadn’t yet spent 120 months making full, on-time payments or working the right jobs;
  • When TEPSLF applicants are denied, they’re never told how to contest their denials; and
  • TEPSLF forgiveness for the 1% who’ve gotten it averages about $41,000; but $653 million remain for TEPLSF to forgive other public servants’ FDLP loans.

So if you do or will qualify for TEPSLF, you may have to fight for debt forgiveness to which you’re entitled as long as Trump appointees run ED — and maybe longer! Here’s to prepare for that:

  1. Be sure you fully understand exactly what you must do to get TEPSLF — i.e. all TEPSLF eligibility criteria and required forms. This information is available through FedLoan’s and ED’s PSLF websites;
  2. Keep a copy of every form, email, and letter you send FedLoan. Use the Postal Service’s tracking function for anything you mail FedLoan and print, file, and keep the tracking function’s feedback to prove FedLoan received what you mailed;
  3. Keep clear, thorough notes — names, dates, times, discussion content, etc. — on every phone conversation you have with FedLoan or ED; and
  4. If you’re wrongly denied, appeal through ED’s Federal Student Aid Feedback System or Ombudsperson.

Sadly, you must assume Trump’s ED and it’s contractor are opposed to you getting the loan forgiveness you deserve under law. So these steps may be invaluable if you ever need help from your congressmen or to sue ED.

Need help understanding what you need to know about student loan repayment or forgiveness? College Affordability Solutions is available for free consultations at (512) 533-5354 or collegeafford@gmail.com.

Before College: Hey High School Seniors! If You’re Not Already Searching for College Scholarships, You Should Be!

Jacob just began his high school senior year. He and his parents recently consulted us about raising the money he needs for a quality college.

Mom and dad can help, but their means are limited, so Jacob needs government grants and loans, summer jobs, and part-time work during the academic year to go to school.

Scholarships would be a big help. They’re the largest source of free money for college, providing as much as three times the amount available in federal grants!

But Jacob hasn’t looked for scholarships. This means he’s about six months behind his more scholarship-savvy classmates. Notifications about scholarship opportunities began coming out this past spring, and fall of the senior year is the key time to apply for them.

Why hasn’t he looked? “I’m just a C+ student,” he said, “I play football and soccer, but I don’t start. Why should I bother looking for scholarships?”

And that’s the biggest myth about scholarships — that they’re limited to academic and athletic stars. They’re not. Scholarships also go to students who meet a wide range of eligibility criteria including, but not limited to:

  • Student community, extracurricular, and leadership activities;
  • Student interest in various college majors and careers;
  • Parent or student membership in various civic organizations, churches, labor unions; and
  • Residence in cities, counties, and towns served by one of America’s millions of charitable foundations.

Where should Jacob begin his scholarship search? There are two places to visit right right away, and keep visiting through high school graduation:

  • High School Counselor’s Office: It receives notices about scholarships throughout the year. It organizes the in file cabinets, notebooks, or online for students to access them; and
  • Scholarship Search Engines: These national internet databases use student-created profiles to generate lists of scholarships for which students are eligible. Students won’t win every scholarship on their lists, but they should apply for all of them because they’re at least qualified candidates.

Free scholarship search engines are the ones to use. Some of the biggest are College Board, Fastweb, and Scholarships.com. But be warned, many search engines sell student profile data to merchants, so resist the adds you’ll get for products you don’t use or can’t afford.

There’s no single database or application for scholarships. As a result, students have to invest lots of time searching and applying for them. But think of it this way — every scholarship dollar won is one less student loan dollar to borrow. And at today’s interest rates, every student loan dollar borrowed can cost up to $2.05 to repay.

So what are you waiting for? Get busy! Start your scholarship search today!

Need pointers about seeking and applying for college scholarships? Students and their parents may consult College Affordability Solutions for free. Contact us by calling (512) 366-5354 or emailing collegeafford@gmail.com.

Before and During College: We Must Address Declining Enrollments By Making College More Affordable

The United States has a serious postsecondary educational problem. It’s affecting individual Americans and the whole nation. And though it needs to be addressed, it’s receiving scant attention.

From 2010 through 2017, fewer students enrolled in U.S. postsecondary degree-granting institutions every year. In 2017 almost 1,254,000 (6%) fewer Americans were attending such institutions than in 2010.

Federal enrollment compilations for 2018 aren’t yet published, but National Student Clearinghouse numbers suggest last fall will mark eight straight years of enrollment decline.

We’re in the knowledge-based century, so this matters — e.g. 79% of American manufacturing jobs went to those with high school diplomas or less in the 1970s, but now over half such jobs require some postsecondary education. Over 95% of all jobs created since the Great Recession went to workers with at least some college.

And for our nation to remain economically competitive, we need more Americans with postsecondary degrees. The U.S. now ranks 13th in the percentage of 25-34 year olds with these degrees (47.76%) — behind competitors like Canada, Japan, Korea, Russia, and the United Kingdom.

Here are some myths about our postsecondary enrollment decline . . .

  • Enrollment always increases during and drops after a recession: For nine straight post-World War II recessions, enrollment spiked in the fall closest to the peak of that recession’s unemployment rate. But the longest post-recession enrollment drop lasted just two years. Conversely, the seven-year post-Great Recession decline is the longest in U.S. history.

So what’s happening? Probably several things. But a most powerful one is surely the matter of postsecondary affordability.

In academic year 2018-19, the average total cost of attending public 4-year colleges and universities was 42% of 2017’s Median Household Income. No more than 24% of this cost was covered by the Federal Pell Grant, down from 43% two decades before. And 65% of 2017 bachelor’s degree recipients graduated after borrowing an average of $28,650.

These costs and debts doubtlessly frighten many students into joining, for example, the 56% who drop out of 4-year schools before completing bachelor’s degrees.

Moreover, the nation’s full-time equivalency rate of undergraduates fell almost 7% from 2010 through 2017. This indicates that increasing numbers are attending college part-time — a behavior strongly associated with dropping out.

But 78% of today’s postsecondary students work while enrolled, their jobs average 30 hours per week, and 25% of them work full-time. It’s nearly impossible to maintain full-time course loads with such demanding employment schedules. And what with escalating costs, family income limitations, and the shrinking “purchasing power” of their grants, students must work for money from sources in addition to or other than loans.

It’s time for policy makers to do something! It’s time to ensure that college becomes more, not less, affordable with each passing year. Reach out to your congressional and legislative representatives about this early and often between now and the 2020 election using Find Your Representative!

Seeking ways of your own to make education after high school more affordable? Let College Affordability Solutions help. Call or email us at (512) 366-5354 or collegeafford@gmail.com.

Authored by Tom Melecki, PhD, College Affordability Solutions.

Before College: Technical Schools May Be Better Options Than Colleges — But Shop Carefully For Them!

Kenny’s beginning his senior year in high school, and he’s looking forward to it. For one thing, his required schooling will soon end — something he’s looking forward to because subjects like civics, English, foreign language, and health bore him to death.

Kenny loves cars and the systems that operate them, so he wants to become a mechanic — and this year he’s got two classes directly related to that. One on computer systems; the other an advanced automobile mechanics course.

His guidance counselor tells Kenny that entry-level mechanics’ salaries average about $39,000 a year, but they rise for those with the right education, certifications, and experience. So Kenny knows he’ll need more schooling after high school. The question? Where can he get classes focusing solely on the workings of motor vehicles so he won’t be bogged down with subjects he doesn’t like?

Technical schools — also known as trade or vocational schools — are exactly what Kenny needs. Their classes and hands-on experiences lead to associate’s degrees, certificates, and diplomas for specific careers. And because their coursework concentrates on those interests, students can graduate from them more quickly and with a tighter focus than from 2 and 4-year colleges. They can also cost less than such colleges whether they’re for-profit or nonprofit.

Moreover, Georgetown University’s Center on Education and the Workforce reports that two-thirds of today’s jobs require postsecondary learning but not necessarily college, and that growing numbers of good jobs — positions paying 25-44 year olds at least $35,000 a year — don’t need bachelor’s degrees but do demand more than high school diplomas.

However, there’s a catch with technical schools. While many offer excellent classes and high placement rates, governments regulate and supervise this sector of postsecondary learning poorly — especially it’s for-profits — so some technical schools are rip offs. Their students suffer big educational debts, high drop-out rates, and few good jobs after graduation. Some are also in shaky financial condition, which can lead to overnight campus closures.

Kenny needs to shop carefully for technical schools, looking past their marketing pitches and instead:

  1. Checking out their costs, graduation and retention rates, salaries after attending, and student debt levels on the U.S. Department of Education’s College Scorecard;
  2. Finding and talking to their current and ex-students about whether they deliver what they promise;
  3. Doing Google searches to see if the media reports any complaints or scandals on them, or if they’ve recently closed any of their locations;
  4. Contacting their state regulatory agencies for whatever data they can share about them.

Good, sound technical schools help students achieve rewarding careers they want. But before enrolling, make sure they’re good and sound. Thoroughly check them out.

Searching for ways to get a quality but affordable postsecondary education? Call College Affordability Solutions at (512) 366-5354 or email us at collegeafford@gmail.com for a free consultation!

Before and During College: Ways to Cut Student Costs During and After College

Many Americans are starting a new year at college. Others are searching for the colleges they’ll begin attending next fall. One thing both groups probably already realize is that postsecondary education is very expensive.

College costs have skyrocketed. From academic year 1998-99 to academic year 2018-19 average total cost of nine months at college increased 133% for private 4-year schools and 148% for public 4-year institutions.

These costs typically include tuition and required fees, books, room and board, transportation to and from campus, and some personal spending. But there’s another cost seldom considered — student loan interest, which generally amasses every day but which customarily gets paid only after commencement..

Here are four great ways to downsize these costs:

    Quality Over Price! Some think that the higher the tuition and fees, the better the school. Not so! The government’s College Scorecard provides much more useful data about 5,800 postsecondary schools — average student loan indebtedness and monthly payments for graduates, graduation and retention rates, and post-graduation salaries.
  • Minimize Time-to-Degree. Less than 42% of undergraduates earn their degrees within 4 years. But graduating on schedule, or even early, can reduce in-school costs and diminish Federal Direct Unsubsidized and PLUS Loan interest accumulation. So enroll full-time enrollment every term, don’t drop classes, and avoid dropping or stopping out of school.
  • Live Modestly. Borrowing to support a professional lifestyle while in college creates loan payments that’ll limit you to a student lifestyle after college! Costs for food and shelter often exceed tuition and fee expenses — even though most students do just fine residing in modestly-priced apartments and dorms, living with roommates, choosing economical on-campus meal plans or, if off-campus, cooking at home instead of eating out. All these strategies are money savers.
  • Leave the Car at Home. Colleges, universities, and cities in which they’re located frequently let students ride free on their mass transit systems. Also, there are multiple ways — car pooling, mass transit, etc. — to go from campus to home and back. So cars at college are seldom necessary. They add costs for fuel, maintenance and upkeep, parking fees, and repairs for damage and vandalism — thereby increasing college debt.

There are many other tried and true cost-control methods, too. The College Affordability Solutions website has a Topical Index with Before College and During College sections, each with a “Cost Reduction Strategies” subsection. There you’ll find links to articles addressing more than 20 methods for cutting in-school costs and de-escalating student loan interest.

College will never be cheap, but it can be less costly. So do some homework. Set your strategies, and then stick with them!

Looking for help with strategies for controlling your college and your student loan expenses? College Affordability Solutions provides consultations to future, current, and past college students and parents — all at no charge. Contact us at (512) 366-5354 or collegeafford@gmail.com if we can help!

After College: On Student Loans, Neither a Delinquent Nor a Defaulter Be!

Federal Reserve Bank of New York data show that a whopping 10.9% of the nation’s outstanding student loan debt is “severely delinquent” — i.e. it’s borrowers are 90 or more days behind on their payments.

If you’re struggling to repay your student loans, inaction and procrastination are the worst things to do. They make you delinquent and eventually lead to default.

You become delinquent when you fail to make a full payment by its due date. When federal loan delinquencies reach 90 days, Washington notifies all three national credit bureaus, damaging your credit rating. This shrinks your chances of getting apartments, auto and home loans, cell phone plans, credit cards, homeowner’s insurance, jobs, and utilities.

After 9 months of delinquency on federal student debts, maybe less for non-federal debts, you’re in default and facing several painful consequences.

Delinquencies and defaults on institutional, private, and state student loans trigger similar penalties. Exactly what their lenders do to you, and when they do it, depends on the promissory notes (contracts) you signed for them.

If you’ll soon be or are delinquent, you have many options. Explore them and choose the best for overcoming what’s hurting your ability to repay. Contact your loan servicer — whomever you make payments to, your lender or a third-party it hires — to pursue them:

Changing Payment Due Date: Ask about resetting your monthly due date if you get paid after that date or your financial obligations leave you with insufficient funds on it.

Changing Repayment Plan: Federal borrowers generally begin in the Standard 10-Year Repayment Plan. Long-run, it’s the quickest, most cost-effective way to repay. But short-run, it typically requires the highest monthly payments. To reduce those payments, research the six other federal repayment plans, including income-driven plans, and use the Federal Student Loan Repayment Estimator to determine your monthly and total repayment amounts under each.

Consolidate: A Federal Direct Consolidation Loan gives you up to a 30-year repayment depending on your outstanding federal college loan balance. This usually lowers your monthly payments. But it’ll also increase what you spend overall to repay.

Deferment or Forbearance: Meeting certain conditions may entitle you to deferment of your monthly payment obligation. Under other circumstances, you may receive a forbearance, letting you either postpone or shrink your monthly payments for a stated period. There are big difference between deferments and forbearances but, long-term, each raises the total amount you repay, so study them carefully.

Most student loan borrowers never seek help as they approach or are in delinquency. But help is ready and waiting so, if you suffer repayment problems, do your research and run to, not from, your loan servicer!

Today College Affordability Solutions begins its summer break, so this is its last post until August 14, 2019. But feel free to use its Topical Index to find more than 150 articles on higher education affordability strategies to use before, during, and after college. Have a great summer!