1. PRESENTER
USC Lancaster
Kenneth T. Cole
USC
Director of Financial Aid
LANCASTER
2. Education as an Investment
Calculating College Costs
Reading an Award Letter
Comparing Colleges by Costs and Awards
Determining How Much You Should Borrow
3.
4. Tuition Room Books & Total 4 Year Cost
& Fees & Supplies Annual (assuming 7%
increase/year)
Board Cost
USC Lancaster $6,252 $6,840 $1600 $14,692 $71,000
(2 year Public)
York Tech. $3,496 $7,200 $1,200 $11,896 NA
(2 year Tech)
USC Columbia $10,168 $6,556 $1600 $18,324 $81,000
(4 year Public)
Clemson Univ. $12,668 $7,228 $1090 $20,986 $93,000
(4 year Public)
Coker College $22,200 $6,950 $1,000 $30,150 $130,000
(4 year Private)
5. Median Annual Salary for workers with
◦ No HS Diploma $13,000
◦ High School Diploma $21,079
◦ Associate’s Degree $30,937
◦ Bachelor’s Degree $40,166
About $20,000 a year for a Bachelor’s Degree
Source:
U.S. Census Bureau's annual survey comparing earnings with education
levels. Based on 2005 year data.
“Study Shows Higher Salaries for College Grads”, by Howard Schneider;
Washington Post Staff Writer
Thursday, March 15, 2007; 10:00 AM
6. What is the cost of education?
◦ 2 year degree $29,384
◦ 4 year degree $81,000
◦ Not considering what Financial Aid might pay
What you could earn in 30 years?
◦ Without a School Diploma $632,370
◦ With a 2 year Degree $928,110
◦ With a 4 year Degree $1,204,498
What the degree is worth?
◦ 2 year degree $266,356
◦ 4 year degree $491,128
College is an Investment that has a 600% return
8. Notification:
◦ Paper Award Letter
◦ E-mail notification (with secure link)
Most award information is now online
You should:
◦ Read Awards Terms and Conditions
◦ Accept loans if you want them
◦ Complete additional forms:
State Grant Affidavits
Student Loan Promissory Notes and Entrance Counseling
Work Study Job Applications and Interviews
9. 4 parts
◦ Estimated Cost of Attendance (COA or Budget)
◦ Expected Family Contribution (EFC from FAFSA)
◦ Calculated Need
◦ Awards
Award name
1st Term award Amount
2nd Term award Amount
Total Award Amount
Enrollment Status used for award (usually full-time)
Total Term Awards
Total Yearly Awards
Summer is usually not included in initial award.
10. Need Calculation Cost of $17720
Estimated Cost of Attendance $17720 Attendance
Expected Family Contribution $ 1000 Tuition & Fees $6500
Need $16720 Books & Supplies $1320
Total Awards* $14100 Room & Board $7100
Unmet Need $ 2620 Transportation $1800
Award Fall Fall Spring Spring Total Decision
Amount Enrollment Amount Enrollment Award (Accept/
Status Status Decline)
PELL $2300 12 (full) $2300 12 (full) $4600 na
LIFE $2500 12 (full) $2500 12 (full) $5000 na
Sub $1750 12 (full) $1750 12 (full) $3500
Loan
Unsub $1000 12 (full) $1000 12 (full) $2000
Loan*
* Unsub loans can be used to “offset” the EFC. So, in this
case only $1000 of the Unsub loan was counted against Need.
11. Give you an example of an “average” student’s costs and awards who
is similar to you.
It will ask:
◦ If you are filing a FAFSA
◦ Your age
◦ Your living arrangements
◦ Your state residency status
◦ Your marital status
◦ If you support any children
◦ Number of people in your Household
◦ Of those, the number attending college
◦ Family Income Range
It will give you:
◦ Estimated Cost of Attendance (COA)
◦ Estimated Total Grants
◦ Estimated Net Price (COA-Estimated Grants)
It does NOT tell you:
◦ What YOU are really eligible for
◦ What YOU will really pay
12. You must determine seven things:
◦ Actual Expenses
◦ Living/Transportation Expenses
◦ Cost of Attendance (COA or budget)
◦ Family Contribution (EFC)
◦ Need
◦ Total Aid Offered
◦ Unmet Cost (budget less scholarships and grants)
◦ Loans
Remember: Tuition, Fees, Books and Dorms are usually only
charged 1 semester at a time. You may need to calculate
13. Actual Expenses include:
◦ Tuition
◦ Fees
◦ Books
◦ Supplies
Tuition Offset:
◦A scholarship/grant provided from institutional funds towards the cost
of Tuition and Fees.
◦Large expensive colleges often offer an “offset” based on your
academics and/or need.
◦These are usually Institutional awards that reduce the costs before
other aid applies.
◦Tuition Offsets reduce Actual Expenses
14. Living/Transportation Expenses:
◦ Room (dorm; apartment, deposits, utilities)
◦ Board (meal plan, eating out, cooking, snacks)
◦ Personal (laundry, toiletries, clothing, furniture)
◦ Emergencies (car repairs, medical issues, clothing)
◦ Daily Travel (bus fare; bike; insurance, gas, parking)
◦ Vacation Travel (car, flights, gas, food)
◦ Cost of Attendance (budget):
◦ Actual Expenses + Living/Transportation Expenses
◦ Need:
◦ Cost of Attendance - Family Contribution = Need
◦ Need limits grants, work-study and subsidized loans
15. Total Aid Offered
Scholarships (except Tuition Offsets)
Grants (except Tuition Offsets)
Loans (you have a choice to accept or decline these)
Workstudy (student must work to earn this money)
Cost of Attendance – Scholarships & Grants= Unmet Cost
Unmet Cost is your actual “out of pocket expense”
Options:
◦ Student Loans
to pay one time fees, or keep in savings for monthly bills
◦ Working a Job
to cover monthly bills and save for up coming big bills
Family Support
College savings plans, car insurance, gas money, food, etc…
16. Total Resources=
Federal Pell Grant
State Scholarships
Scholarships from Sponsors (those not from colleges)
Federal Loans ($5500 as Freshman)
Savings Plans
Cash and other assets
For Each College, determine:
Cost of Attendance – Total Resources = Unmet Cost of College
Subtract Institutional Grants and Scholarships = Actual Cost
Use that to compare and determine which college you can
afford.
17. Will you need to borrow a student loan?
Example of a fairly inexpensive school
Tuition + Fees + Books + Supplies
$6000 + $500 + $1200 + $120
Need Grants Scholarships Need Grants
and Only Only
Scholarships
Actual Costs $7,820 $7,820 $7,820
LIFE - $5,000 $5,000 $0
Pell - $5,550 $0 $5,550
Lottery - $0 $0 $950
Unmet Costs $0 $2,820 $1,320
18. Calculate your anticipate Loans
◦ Determine how much you must borrow each year
◦ Add 20% to the total
12% for cost increases
8% for accrued loan interest
◦ This is how much you will have borrowed at this college.
◦ The undergraduate loan limit is $31,000
◦ You can also borrow private student loans, but it is
discouraged.
19. Your debt-to-income ratio can be a valuable number -- some say
as important as your credit score. It's exactly what it sounds: the
amount of debt you have as compared to your overall income.
Lenders look at this ratio when they are trying to decide whether to
lend you money or extend credit.
Monthly Debt payments/ Monthly income=DTI
You want to keep your “DTI” below 36%
20. If you borrowed $31,000 in student loans,
your monthly payments would be $400; and
if you paid a typical house payment of $1000 and
a typical car loan of $400 monthly; and
if you wanted to maintain a DTI of no more than
36% (to keep good credit); then,
you would need a monthly income of about $5000,
or about a $60,000 annual income.
Your student loan would therefore be about 51%
of your annual income.
Hence, we recommend...
21. Don’t borrow
More in student loans than
half
of your anticipated
annual income for your career!
22. Research your career field:
Career Starting Income Rec. Limit
◦ Attorney: $100,000 $50,000
◦ Software Developer: $92,000 $46,000
◦ Finance Manager: $85,000 $42,500
◦ Construction: $70,000 $35,000
◦ Mechanical Engineer: $65,000 $32,500
◦ Operations Manager: $60,000 $30,000
◦ Human Resources Manager:$60,000 $30,000
◦ Bank Manager: $55,000 $27,500
◦ Executive Assistant: $47,000 $23,500
◦ Accounts Payable Specialist:$37,000 $18,500
23. Thank you for your
attention!
Contact Us!
USC Lancaster
Kenneth Cole
BY MAIL: PO Box 889
Lancaster, SC 29721
BY PHONE: (803) 313-7068
Visit Us: 127 Starr Hall, Hubbard Drive
BY WEB: http://usclancaster.sc.edu/
A presentation like this is available at the USC Lancaster Financial Aid Office
Website
