A Year of College Affordability Solutions

College Affordability Solutions is dedicated to helping families keep higher education spending within their means. It uses this website to highlight postsecondary educational cost-management strategies at the times of the year when you and/or your student are most likely to need them.

21-of-the-most-beautiful-college-campuses-in-amer-2-20243-1428837186-9_dblbigDespite those who’ll try to talk your student out of college, postsecondary education is still worthwhile even if he or she has to borrow to pay for it. But student loans increase the cost of college, so do everything possible to minimize their use.

Over the last year, we’ve covered several approaches to keeping college and college-related debt affordable. Click on any of the links below to learn more . . .

Before College

Various investment and savings programs can help you prepare for college bills. Among these are 529 plans and college savings bonds, but you should explore them all – the sooner the better.

And be sure to apply for financial for every year of college. Complete the Free Application for Federal Student Aid (FAFSA) as soon as possible after October 1 but, by all means, before your FAFSA priority deadline arrives.

Student dependency status plays a big role in who completes the FAFSA. Other family factors do, too. But it isn’t as hard to complete as you’ve heard, especially if you fulfill 5 key steps, gather all the documents you need, and get answers to your last-minute FAFSA questions before doing so.

Long before the FAFSA, your student needs to begin aggressively searching for scholarships. It’s critical to know about the when and where and the how of doing this.

Pay close attention after you file your FAFSA to make sure you handle what happens next. Then carefully assess your financial aid offers as they arrive from colleges.

But it’s not all about financial aid and scholarships. A critical factor in college affordability is for your student to enroll in a college and major that fits him or her well.

During College

Once college begins, you can help your student keep his or her expenses within reason.140815_FF_BestCollegeCard Limited spending and indebtedness is important even with today’s low college loan interest rates.

Some of the most effective strategies for minimizing student borrowing include your student getting through college in 4 years or less while carefully managing money and avoiding rip offs such as the recent “student tax” scam. A little-known but highly-effective cost-saver involves returning unneeded federal loan dollars with 4 months of disbursement.

Help your student keep college more affordable by giving him or her some holiday gifts that’ll lower his or her reduce expenses upon returning to school and by recommending he or she generate funds through seasonal employment instead of borrowing.

After College

Seven out of 10 students borrow before earning their degrees, and over 90% of their loans come from federal loan programs. Fortunately, the government has designed  post-graduation strategies to help keep educational debt manageable.


Your student needs to understand what happens to college loans after graduation. It’s worthwhile to consider the pros and cons of student loan consolidation, an often-used tactic for reducing monthly debt payments. Equally important is knowing how your student might qualify for forgiveness on all or part of what he or she owes.

Coming in 2017

We’re taking a few weeks off for the holidays, but beginning January 4 we’ll start publishing again about plans for keeping college affordable. Here’s hoping you have the happiest of holiday seasons, and that you’ll rejoin us then!

 Find out more about College Affordability Solutions and its services at https://collegeafford.com, or by calling (512) 366-5354.

Is College Worth It? Damn Right It Is!

Many so-called experts claim college isn’t worth what students and families pay for it. This is especially true, they say, because students must borrow so much and, besides, there are lots of great job opportunities right out of high school.

This is rubbish! Pure baloney! How do we know? Because almost everyone who says it has a college degree. And they’re in jobs requiring college degrees.

Want to earn more and reduce your chances of unemployment? Get as much education as you can handle:

2015 Earnings and Unemployment by Education Level of Americans 25 and Older

Education Median Weekly Earnings Unemployment Rate




No High School Diploma



High School Diploma



Some College, No Degree



Associate’s Degree



Bachelor’s Degree



Master’s Degree



Doctoral Degree



Professional Degree



Source: U.S. Bureau of Labor Statistics.

Small wonder College Board found that 90% of college graduates from America’s lowest-income families moved up to higher income levels than their parents.

And that student debt? 2015 college graduates borrowed an average of $30,100 while in school. At the very most, it’ll cost them $69,356 to repay such a debt. That’s a lot! But median lifetime earnings for Americans with bachelor’s degrees is $954,000 more than for those with high school diplomas. Result? At least $13.75 earned for every dollar repaid — not a bad return!

Do you want to help make America great again? Get more education. The Congressional Research Service reported that, in 2013, 21% of Americans who only finished high school lived in poverty while just 7% of those with bachelor’s degrees were in poverty.

The College Board found that households headed by parents with high school diplomashappy graduates were as much as six times more likely than those with bachelor’s degrees to rely on expensive public assistance programs, and that Americans vote more, volunteer more, and pay more taxes as they become more educated.

Don’t overspend on college. Don’t seek a bachelor’s degree if you’re after a career requiring a less-expensive associate’s degree. And don’t borrow more than you absolutely need. But don’t let the phonies fool you, either! A college degree is the best investment you’ll ever make in yourself!

College Affordability Solutions brings 40 years of experience to help students and families figure out ways to pay less for college. Call (512) 366-5354 or email collegeafford@gmail.msn for such help.

Student Money Management — The $10 Latte

The average amount borrowed by America’s 2015 graduating class was $31,100 — $12,600, or 68% more than for the Class of 2005. Depending on how he or she chooses to img_4155repay, a member of the Class of 2015 could spend up to $57,865 to pay off a $31,100 debt.

But there’s a surefire way to graduate with less debt. Believe it or not, it’s best illustrated in an old Saturday Night Live skit, “Don’t Buy Stuff You Cannot Afford!

Funny skit, though it’s message sounds like another old cliche from those who “nag” students about controlling their spending. Still, like many cliches, there’s much truth in this message.

You have to borrow, from student loans or credit card companies, to buy something you can’t afford. And in the future you’ll repay what you borrowed — essentially dedicating future earnings to pay today’s expense, plus interest that builds up on that expense.

Fortunately, there are simple, sensible things you can do to hold the line on how much college debt you’ll have to repay.

Take Annie, a freshman. Annie finds it difficult to get going in the morning so, on theimg_4154 way to class, she spends $4.95 of her federal loan funds on a latte grande from a well-known coffee shop. Annie’ll pay another 42 cents in the sales tax on that purchase. And although the current interest rate on her federal loan is the lowest in 10 years, Annie will pay back as much as $10.00 for the $5.37 she borrowed to buy today’s latte.

If student loans can almost double what Annie ultimately pays for one latte, imagine how they’ll multiply the extra costs you’ll incur to live for 9 months in an expensive, high-amenity apartment; or to pay a campus parking fee for a car you could leave at home; or to eat out four-five nights a week instead of cooking in your apartment or chowing down in your dorm’s dining hall! As for Annie, she could get her pick-me-up and save money by drinking homemade coffee or asking for a home latte machine for Christmas.

There’s an old saying — “Borrow to live like a professional while you’re a student and your loan payments will force you to live like a student when you’re a professional!” Don’t victimize yourself! Find ways to borrow only for absolutely necessary expenses!

College Affordability Solutions can help devise strategies to limit college debt. Call (512) 366-5354 or email collegeafford@gmail.com to request such help.

Save Money: Return Excess Federal Loan Funds

Hanging onto unnecessary federal loan funds is a losing proposition — even if your student is “saving” them to use next term. At current interest rates, no savings account will pay more than the interest building up on those loans, and federal loan funds can’t be safely invested to earn as much as they cost in interest.

So as your student gets a feel for his or her fall college expenses, here are some tips for saving money on federal loan funds borrowed to pay those costs:

(A)  Return unneeded loan funds within 120 days: If your student figures out he or she won’t need them, he or she may contact the financial aid office and ask about how to best return the loan funds not needed for the term*. When this is done within 120 days of the funds being disbursed — i.e. paid toward tuition and fees or turned over to your student, whichever is earlier — Washington cancels its 1% loan fee, plus any interest that piled up on the returned amount. It’ll be as if those funds were never borrowed!

If your student received funds from multiple federal loans, the returned amount will pay them down in the following order — (1) Federal Direct Unsubsidized Loan, (2) Federal Direct Subsidized Loan (3) Federal Perkins Loan; and (4) Federal Direct Parent PLUS Loan.

(B)  Reduce next term’s federal loan(s) if that’s affordable: If your student is scheduled to get federal loan funds for the next term, this is a good time to consider whether or not all those funds will be needed to cover that term’s tuition and other expenses. If not, advise your student to tell the financial aid office to downsize that term’s loan(s).

(C)  Amounts returned can usually be re-borrowed if necessary: What if your student’s expenses turn out to be higher than expected? He or she can always go back to financial aid and request more loan funds, generally up to the amount that was returned. And interest won’t begin building until the new disbursement date for the re-borrowed funds. Note: Your student needs to request these funds at least two weeks before they’re needed. It sometimes takes that long for the funds to arrive from Washington.

 * Sometimes financial aid offices will return unneeded loan funds for students and sometimes they will give students guidance on how to return such funds themselves.

College Affordability Solutions offers 40 years of experience with federal student loans. Call (512) 366-5354 of email collegeafford@gmail.com if you’re interested in getting its advice on your federal loans.

A Degree in 4 Years: The Best Way to Limit College Costs

The new school year is here! Fall semester is beginning on campuses all across America. You may have just dropped your student off at college. If you did, chances are a few tears were shed as you pulled away from campus.

Yes, the college years generate many opportunities for parental tears. One of the most common occurs every time you pay those college-related bills — for tuition, fees, books, room, board, and the other expenses your student incurs. The latest data available from College Board show that, for two semesters in 2015-16, all these expenses added up to an average of $24,062 at public in-state institutions and $47,831 at private schools.

Higher education costs are particularly subject to escalation, so every year your student’s college expenses are likely to grow faster than inflation. They’ve increased an average of 5.5% per year at public colleges and 5.0% at private universities since 2005-06. At this rate, 4 years at public and private institutions will average $110,226 and $215,938, respectively, for this fall’s entering freshman class. But only about 40% of American undergraduates complete their degrees within 4 years, so it is important to remember that, in 2020-21, the average cost of extra time in college will cost approximately:

                                                                           One Semester        Academic Year

Public College or University                           $15,725                    $31,450

Private College or University                         $30,380                    $60,760

Clearly, the best way to reduce college spending and borrowing is to get a degree within 4 years. To help reach this goal, here are five things you should coach and coax your student to do:

(1) Complete the heaviest possible course load every semester. The math is simple. Let’s say your student is in a degree program that requires 120 semester credit hours for completion. Absent transfer or credit-by-exam hours (see below), he or she will need to enroll in and successfully conclude an average of 15 hours per semester in order to graduate in 4 years.

Some colleges offer what might be called “flat rate tuition” to students who register for more than a certain number of credit hours. Under such an arrangement, your student would pay the same amount to take, for example, 15 or 18 hours per semester as 12 hours per semester. Urge your student to check into this with his or her academic advisor.

And remember, the objective is not just to register for courses, but to successfully finish them. Dropping a course not only lengthens time to degree but, even worse, you pay for it again if your student must pass it to graduate. So urge your student to avoid dropping courses if at all possible.

(2) Take courses that fulfill requirements for graduation. Yes, college is a place for exploration and self-discovery. But it’s a mighty expensive place to explore and discover to much. So you may want to urge your student to forgo courses that “might be fun” or “sound interesting” unless they also apply to core (i.e. out-of-major) or major (i.e. within major) requirements. Fortunately, many colleges and universities offer a broad menu of courses that fulfill such requirements.

(3) Transfer college credits in. While in high school, did your student successfully finish any “dual credit” courses through a community college? Did he or she pass any AP tests? If so, many colleges will accept those credits — especially as substitutes for their core requirements. So if your student has not already transferred them in, suggests that he or she go to the registrar’s office and arrange to do so.

Likewise, one way to stay on track for a 4 year degree is to transfer summer courses from local community colleges back to the schools at which students are seeking their degrees. Tuition at community colleges is lower than at 4-year institutions and, since your student can live at home, there’ll be no room and board to pay during the summer. Also, community college students can usually complete 6-10 summer credit hours even as they work part-time to save money for the rest of the school year. But note — it is important check with an academic advisor ahead of time to ensure that community college credits transferred in will count toward core or major requirements at the 4-year school. Otherwise, all summer enrollment does is generate extra tuition costs.

(4) Don’t transfer your student out if you can avoid it. Remember, if your student transfers to another college or university, chances are he or she won’t get credit at that institution for all courses completed at his or her current school. This creates another situation in which your student will have to take (and pay for) some of the same courses multiple times. Of course, if your student’s current school turns out to be a horrible fit, it may be necessary to transfer elsewhere but, if he or she can stick it out until graduation, urge your student to do so.

(5) Test out of courses if possible. Many colleges and universities have on-campus testing centers. For a relatively small fee, your student may be able go to this center and gain credit-by-exam in certain subjects. Credit-by-exam substitutes for full-tuition classroom courses — especially those applicable to core requirements. This can help your student lighten his or her semester course load while speeding time to degree.

It may not be easy for your student to implement these strategies. Extra effort and sacrifice is often required. Your student may not have as much time to socialize as much as others do. He or she may need to spend extra night and weekend hours studying. And he or she may have to persist in some difficult situations.

You’ll probably need to provide lot of encouragement and support, so don’t forget those “care packages,” phone calls, and visits! But it’ll be worth it — for both you and your student. Those who graduate within 4 years, save tens of thousands of dollars by forgoing extra college expenses and, not surprisingly, at least one study shows that such students incur  35% less debt than those who finish in 5 years.

A 4-year graduate starts his or her career 12 months earlier than 60% of his or her peers, leading to a much faster yield of college educated wages – which currently average more than $1,100 a week or $59,000 a year. So there are definite and tangible payoffs to graduating within 4 years. You’re most likely the person to whom your student listens the most, so you can help those payoffs become realities!

College Affordability Solutions brings 40 years experience to coaching families about these and other higher education affordability measures. Call (512) 366-5354 or email collegeafford@gmail.com to learn more.

Getting Your Federal Student Loans Forgiven

Do you owe on federal student loans? Did you know that, under certain circumstances, the U.S. government will forgive (or “cancel” or “discharge”) all or part of it? You need to know about these if you are or soon will be on the job market!

Public Service Loan Forgiveness (PSLF): Ten years ago Congress realized many baby boomers who performed public service will soon retire, requiring lots of well-educated young workers to replace them. So now PSLF will forgive any Federal Direct Loan Program (FDLP) debt you owe after you (1) work full-time for 10 years for federal, state, or local government, or for a 501(c)(3) nonprofit, and (2) make on-time monthly loan payments for all 10 of those years.

You’ll also need make to make your monthly payments under the government’s standardpublic%20workers%20cropped%20shrunk repayment plan or one of its income-driven repayment plans. The standard plan normally requires you to pay your debt in full within 10 years, eliminating your opportunity for forgiveness. But if you replace your current federal loans (including your Perkins Loans) with a Federal Direct Consolidation Loan of $7,500 or more, you’ll get a 12 to 30 year repayment period. This lowers your monthly payments and helps you qualify for the maximum amount of loan forgiveness once you hit the 10 year mark.

Teacher Loan Forgiveness: Congress also knows our nation has a tough time getting teachers to teach, and keep teaching, vitally important subjects, especially in our poorest schools. So under this program you’ll qualify for forgiveness of your FDLP and Federal Family Education Loan Program (FFELP) loans – although loans made to parents don’t qualify for Teacher Loan Forgiveness — once you hit five complete, consecutive years of full-time teaching in a Title I or low-income school as a highly-qualified teacher. Up to $17,500 of your debt may be forgiven if you teach math or science to high school students or special education children with disabilities. Teaching other elementary or secondary school subjects qualifies you for up to $5,000 of forgiveness.

Perkins Loan Teacher Loan Cancellation: This program — under which you can have up to 100% of your Federal Perkins Loan debt cancelled — began when the Soviet Union launched Sputnik in the 1950s, causing Congress to realize that we needed more teachers for national security purposes. It’s been amended a bit through the years. Now, to qualify for it, you must have served full-time in a public or nonprofit elementary or secondary school system while (1) teaching students from low-income families; or (2) providing special education services to infants, toddlers, children, or youth with disabilities; or (3) teaching math, science, foreign languages, bilingual education, or any other field in which your state education has a shortage of qualified teachers.

If you’re eligible, your Perkins debt will be canceled in the following increments:

Ÿ  – 15% each for your first and second years of teaching; and

Ÿ  – 20% each for your third and fourth years of teaching; and

Ÿ  – 30% for your fifth year of teaching.

Interest that accrued during each year gets cancelled, too, and you may defer repayment while performing teaching service that qualifies for cancellation. Contact the college or university that made your loan to you for information about deferment.

Other Perkins Loan Cancellation and Discharge: Washington also has programs to cancel your Federal Perkins Loan debt if you perform various types of service. These include but aren’t limited to serving as a nurse or medical technician, in law enforcement or corrections, in the U.S. armed forces in areas of hostilities, in ACTION or the Peace Corps, and in child or family services. The amount that may be canceled depends on what service you perform. Depending on when you took out your loan, you may be eligible to cancel part of or all of it.

The government also forgives federal student debt if you die or become totally and permanently disabled (not recommended). It also has a few other, highly specialized and little used discharge programs for students whose colleges misbehaved. Follow the links embedded above for more information on all types of federal student loan forgiveness.

College Affordability Solutions has decades of experience with the federal student loan forgiveness programs. Need help understanding them? Call (512) 477-5354 or email www.collegeafford.com to find out how we can help you.

Some Good News for College Borrowers

If you’re a parent or student who needs to borrow to help pay for college expenses, your 2016-17 Federal Direct Loans will enjoy the lowest interest rates in five years.

The Federal Direct Loan program provides nine out of every 10 college loans in the United States. Interest rates on 2016-17 Federal Direct Loans will be 0.53% lower than in 2015-16:

Federal Direct Loan Type

2016-17 2015-16






Graduate Student PLUS



Parent PLUS



Each year’s Federal Direct Loans interest rates are fixed, meaning they never go up or down, and the interest rates for loans made the year1 are based on the interest rate for 10-year treasury notes auctioned by the government in May.

While lower interest rates are good news, it’s still important to borrow conservatively. For example, a student who borrows the maximum allowable amount of subsidized and unsubsidized loan during his or her freshman year will save only $42 under the new interest rates versus the interest rates in place for 2015-162.

Need strategies for keeping your college debt manageable? College Affordability Solutions brings 40 years of experience in higher education and student loans to advise you. Contact (512) 366-5354 or collegeafford.gmail.com if you want to explore what College Affordability Solutions can do for you.

1    2016-17 Federal Direct Loans are loans whose proceeds are fully or partially disbursed from July 1, 2016 through June 30, 2017. 2015-16 Federal Direct Loans are loans whose proceeds are fully or partially disbursed from July 1, 2015 through June 30, 2016.

2    This assumes the student repays the loans according to the standard repayment schedule used by most students.

10 Strategies for Keeping College Debt Manageable

It may be necessary to borrow in order to go to a college that’s a good fit. But making smart and disciplined decisions can help keep your student’s college debt from becoming an unaffordable monster. Here are some strategies for doing that . . .

(1)  Make Those Dollars Stretch: Your student needs a plan to guide his or her spending at school. Tuition, fees, and on-campus room and board will be deducted from financial aid at the beginning of each semester. Then remainder has to pay for books, transportation, and personal expenses for the rest of the semester. Making and sticking to a spending plan can help your student avoid running out of money before the semester ends — at which point the only type of aid that’s left is likely to be loans.

(2)  Get a Job: You may worry about your student working, especially while adjusting to the rigor of college during the freshman year. But research shows that undergraduates who work 10-14 hours per week average higher GPAs and lower drop-out rates than those who don’t work at all. Working helps your student earn money to limit borrowing, gain resume-enhancing employment experience, and generate future references for graduate school and job applications.

(3)  Borrow Only What’s Absolutely Necessary. There’s an old saying, “The student who borrows to live like a professional before graduation will have to live like a student after graduation!” If his or her spending plan indicates your student can cut back on borrowing, urge him or her to do so.

(4)  Don’t Borrow It Just Because It’s Offered. That’s right. No rule requires your student to accept any loan funds that are offered. In fact, most financial aid award letters provide ways to wholly or partially reject loan awards. If your student accepts loan funds on the award letter but then figures out they’re not needed, he or she should contact the aid office to reject them. If your student ends up needing some of those rejected funds later, he or she can go to the aid office and have his or her Federal Direct Loans reinstated.

(5)  Borrow from Uncle Sam First. The U.S government provides $9 out of every $10 student loan dollars. Why? Because federal loans are just better than other student loans. Unlike private loans, interest rates on federal loan are fixed, so interest on them will never rise. They offer six different repayment plans — including plans limiting monthly payments to a percentage of after-college income — and borrowers may switch plans whenever they need. Borrowers can lower their monthly payments by stretching out their repayment periods and, if they suffer short-term economic problems, they can postpone their monthly payment obligations. Federal loans also have generous forgiveness programs.

(6)  Minimize “Unsubsidized” Student Loan Borrowing. Even within the federal programs, some loans are better than others. Federal Direct Subsidized Loans and Federal Direct Unsubsidized Loans have the same interest rate, but subsidized loans will cost your student much less than unsubsidized loans. How? Interest doesn’t accumulate on a subsidized loan until your student has been out of school for 6 continuous months — i.e. the “grace period.” Conversely, unsubsidized loan interest begins accumulating the day loan funds are disbursed (applied to tuition and fees or transferred to your student). No payments will be required until the grace period ends, but then outstanding interest gets added to loan principal, and interest begins accumulating on an inflated principal amount.

(7)  Prepay It. If your student can ever afford to make a payment while in school, even a small one, it’ll reduce what he or she will pay later. Better still, repaying Federal Direct Loan funds within 120 days of disbursement causes the government to cancel any interest and loan fees that accumulated on the amount repaid. The financial aid office can tell your student how to make such a payment.

(8)  Don’t Save Unsubsidized Dollars for Next Year. At the end of each academic year, some students bank the loan dollars they received but didn’t use. Bad idea! This is especially true for unsubsidized loans which, at today’s rates, accumulate interest at 4.29% per year. Paying over 4% for funds on which a savings account will yield 1% to 1.25% is a lousy investment strategy and, remember, your student can get new loans next academic year. One exception: using leftover loan funds to cover tuition and books for summer school courses at the local community college. The community college must considerer your student as a “transient student” while completing such courses, but your student will likely be able to transfer them back to his or her university — thereby accelerating time-to-degree.

(9)  Graduate. Remember, the holder of a bachelor’s degree averages earnings of $964 thousand more in a lifetime than the average person who gets a high school diploma. The extra earning power a degree brings can go a long way toward making your student’s college loan payments more manageable. If your student drops out without a degree, he or she’ll miss out on this earnings boost, not to mention all the other benefits that go with college completion.

(10)  And Don’t Dawdle Along the Way to Commencement. Accelerating time-to-degree can be a real money saver. One major university recently found that its undergraduates who earned their degrees within four years averaged 35% less debt than those who earned degrees in five years, and 51% less debt than those who did so in six years. So urge your student to get that degree as soon as possible.

College Affordability Solutions has educated thousands of Americans on the ins and outs of student loans. Call (512) 366-5354 or email collegeafford@gmail.com if you need help.

What Student Loan Debt Costs

Counselors, financial aid advisers, and parents urge students to borrow only what they absolutely need while in college. Many students disregard this as irksome nagging. But it’s good advice because what your student borrows will cost a lot more than what he or she gets.

Your student’s exact borrowing cost can’t be calculated ahead of time. There are just too many variables at play. Still, we can get a fairly close estimate by taking into account the typical behaviors of students who go into debt to go to college.

Your student will likely borrow Federal Direct Subsidized Loans and/or Federal Direct Unsubsidized Loans. These account for almost 90% of what today’s students borrow. They have the same interest rate – currently 4.29% — and repayment terms. But they’re very different.

The difference is how their interest accumulates. There is no interest on subsidized loans while your student is in school and in his or her grace period — 6 months that begin at graduation and during which payments are not required on his or her loans. On the other hand, interest on unsubsidized loans begins accumulating the day loan funds are issued to a student borrower. It keeps accumulating until the debt is repaid in full.

Federal law allows students to pay interest that piles up on unsubsidized loans while in school and grace, but most students can’t afford this or they choose to spend their money elsewhere. That’s a problem, because the law also permits the government to add unpaid interest to unsubsidized loan principal when the grace period ends. This is called “capitalization.” It inflates the loan’s principal which, in turns, causes more interest to accumulate on unsubsidized debt.

Let’s assume your student gets a degree in 4 years while borrowing $2,500 — $1,250 in subsidized loan and $1,250 in unsubsidized loan — when each of his or her 8 semesters begins. At graduation, your student’s principal amount is $10,000 for each type of loan, a total of $20,000. Also assume he or she repays the debt just as most students do — under what’s called the “standard” repayment option, which requires equal monthly payments for 120 months.

Here’s what the $20,000 your student borrowed ends up costing:




Principal borrowed before graduation




Interest accumulated while in school and grace period




Payments made while in school and grace period




Interest capitalized at end of grace period




New principal balance at end of grace period




Interest accumulated over 120 months of repayment




Total amount repaid




Cost of borrowing


41.81% 32.51%

There are other repayment options, but they all end up costing more. So your student really needs to:

  1. Borrow only what he or she needs;
  2. Minimize unsubsidized loan borrowing; and
  3. Pay unsubsidized interest while in school and in grace if possible.

College Affordability Solutions provides counseling and education on managing and repaying student loan debt. Call (512) 366-5354 or email collegeafford@gmail.com if you’re interested.

Texas Undergraduate Debts Grow 53% in Ten Years

The average amount borrowed by Texas undergraduates who used loans to help finance their bachelor’s degrees increased 53% from 2004 to 2014, surging from $17,170 to $26,250. This is nearly double Texas’ 28% inflation rate during this period. The percentage of Texas undergraduates who borrowed also rose, from 51% in 2004 to 59% in 2014.

This according to an October report from the Project on Student Debt entitled Student Debt and the Class of 2014The Project on Student Debt is an initiative of the nonprofit Institute for College Access and Success. It works to increase public understanding of student debt and its impact on families, the economy, and society.

Nationally, the percentage of undergraduates who borrowed climbed only 4% from 2004 to 2014 (65% to 69%), but the average amount they borrowed escalated 56% — from $18,550 in 2004 to $28,950 in 2014.

The Project on Student Debt also provides undergraduate borrowing data on a school-by-school basis for each state. These data are the basis for lists (included below) of Texas’ ten highest and lowest debt schools for 2014 in the public and private non-profit sectors of higher education.

At least, these are the highest and lowest debt schools The Project on Student Debt could identify in Texas. Half of the state’s institutions of higher learning — accounting for 27% of the Lone Star state’s 2014 bachelor’s degree earners — did not make their 2014 student borrowing data available. These include some of the state’s largest and best-known schools – for example, Baylor University, Lamar University, St. Mary’s University, Texas Woman’s University, and the University of North Texas.

No law requires colleges and universities to provide the debt levels of their students. But why would they withhold such information? Perhaps they are worried about its impact on their freshman recruiting efforts.

Recommendation: No matter what the reason, if a school has not disclosed its student borrowing data, be a smart consumer and demand these numbers before making any commitment to attend that school — especially if you already know your student might need to borrow while working toward his or her degree. Student debt should not be the sole basis on which you select a college or university, nor should you be afraid to borrow if necessary. But student debt is growing so fast that it should be one of the factors you take into account.

Highest and Lowest Debt Texas Colleges and Universities 2014 by Institution: Average Debt of Graduates/Percent of Graduates Who Borrowed

Highest Debt Texas Public Colleges and Universities 2014

  1. Texas Southern University: $43,600/95%
  2. Sam Houston State University: $31,433/71%
  3. Prairie View A & M University: $27,500/67%
  4. The University of Texas at San Antonio: $27,337/66%
  5. Stephen F Austin State University: $27,278/66%
  6. The University of Texas at Austin*: $27,207/55%
  7. Texas A&M University Corpus Christi: $26,445/69%
  8. Tarleton State University: $26,267/64%
  9. Texas State University: $26,031/64%
  10. Midwestern State University: $25,550/67%

Lowest Debt Texas Public Colleges and Universities 2014

  1. The University of Texas Pan American: $14,900/61%
  2. Texas A&M International University: $17,394/74%
  3. University of Houston Main Campus: $18,453/48%
  4. The University of Texas at Dallas: $19,613/48%
  5. West Texas A&M University: $20,682/59%
  6. The University of Texas at Arlington: $23,210/58%
  7. University of Houston Downtown: $23,249/57%
  8. Texas A&M University College Station: $23,703/47%
  9. The University of Texas at El Paso: $24,000/67%
  10. Texas Tech University: $25,306/56%

Highest Debt Texas Private Non-Profit Colleges and Universities 2014

  1. Abilene Christian University: $43,841/67%
  2. Texas Christian University: $39,584/43%
  3. LeTourneau University: $38,211/76%
  4. Mary Hardin-Baylor University: $37,048/90%
  5. Texas Wesleyan University: $37,014/92%
  6. University of St Thomas: $36,497/57%
  7. University of Dallas: $35,561/61%
  8. Trinity University: $35,318/50%
  9. Hardin-Simmons University: $34,800/75%
  10. McMurry University: $34,742/90%

Lowest Debt Texas Private Non-Profit Colleges and Universities 2014

  1. Rice University: $22,241/29%
  2. Concordia University: $24,882/75%
  3. Wayland Baptist University: $25,725/71%
  4. Lubbock Christian University: $27,949/78%
  5. Dallas Baptist University: $28,279/80%
  6. Our Lady of the Lake University: $28,362/84%
  7. Schreiner University: $29,364/87%
  8. Incarnate Word University: $29,744/82%
  9. East Texas Baptist University: $30,718/88%
  10. Southwestern University: $30,935/60%

Author: Tom Melecki, PhD

Next – What Does Student Loan Debt Really Cost?

* Disclosure: The author is an alumnus of UT Austin and previously served as UT Austin’s director of student financial services.