The rising cost of tuition in the United States has made post-secondary education inaccessible for many. Having increased more than 25% in the last 10 years, the price of attending an accredited institution has increased almost 8 times faster than wages. As a result, students are considering alternatives to student loans to fund their college tuition.
With over 20 years of experience in the music industry, and as the Entertainment Advisor of the Bessie Smith Estate, Lindsay Guion is deeply familiar with the financial difficulties faced by students. Having established the Bessie Smith Scholarship Program to address the tuition gap, Lindsay Guion outlines the statistics of the rising cost of tuition in the United States, as well as the scholarships and financial aid available to students.
The cost of a college education is skyrocketing
From 2016-17 to 2017-18 school year, the average cost of tuition and fees increased by more than 3% at private and public colleges. Lindsay Guion explains that it may come as no surprise then to learn that student loans make up the largest portion of U.S. non-housing debt—more than credit cards or auto loans. This of course, is due to the rising costs of a college tuition and a lack of growth in wages. The average cost for almost all four-year institutions comes out to roughly $26,120 a year, saddling students with more than $100,000 in debt upon graduating.
The importance of a post-secondary degree
These statistics leave many students in a difficult position, as a college degree is often a basic requirement for landing a professional job. Statistically speaking, a college degree leads to improved financial security. In 2018, college graduates earned weekly wages that were 80% higher than those of high school graduates. In addition, the Bureau of Labor Statistics reports that Americans with a bachelor’s degree have median weekly earnings of $1,173 compared to just $712 a week for high school applicants. Another compounding factor is that in the United States, the cost of living has steadily increased over the past several years.
As a result of rising tuition, increased student debt, and stagnant wages, students across the United States are looking for funding alternatives. As the Senior Entertainment Advisor of the Bessie Smith Estate, Lindsay Guion runs the Bessie Smith Scholarship Program. While only 0.3% of students earn full-ride scholarships from their university, public scholarships are widely accessible. Whether it is through civic organizations, businesses, charities, or individuals, scholarships in the United States are plentiful.
Best of all, some scholarship funds simplify the process for students. The Bessie Smith Scholarship Program requires a letter of enrollment and a 500-word essay. Their submission is open until August 31st, 2020, and will pick three winners which will be announced in September 2020.
Another financial aid alternative are student grants provided by the federal government, states, and colleges. A grant, like a scholarship, is a form of financial aid that does not need to be paid back. While grants do not typically cover the entire cost of tuition, they can be a part of a comprehensive student aid package. The most common grant is called the Federal Pell Grant, which grants up to $5,815 per student.
Lastly, Lindsay Guion outlines the opportunity for students to engage in work study programs. Federal work study offers students a chance to gain work experience providing an income. Most work study jobs are part time, but some universities help students work in an area that is related to their specific field of study. In addition, income from work study jobs are subject to federal and state taxes, but this income is exempt from Social Security taxes—and it does not reduce eligibility for financial aid.
The bottom line
The statistics are sobering, and during a pandemic, the situation seems even more dire. As remote learning has become the new norm, students all over the country are petitioning for tuition to be slashed as universities and colleges go online. The existing pressures of college tuition have only been compounded, and Lindsay Guion explains that having a comprehensive student aid plan is critical for reducing student debt. It is more important than ever for students to seek out alternatives to student loans before resorting to borrowing. Even if the alternative measures do not cover the full cost of tuition and living expenses, they will reduce the amount you have to borrow in the end.