Posted by CovidNew Coronavirus OutbreakDuring the period, the overall enrollment rate of American college freshmen fell by 13%, but college tuition did not decrease.
A recent hot news is that Columbia University was sued by students in court due to the problem of remote classes during the epidemic, demanding tuition refunds.
In the spring of 2020, Columbia University announced that it would move all classes online.Students believe that this does not match the high tuition fees, and demand a refund of part of the tuition fees.
In November 2021, Columbia University pledged to refund $11 million in tuition and reached a settlement with students.
It is a consensus that American college tuition is high. Whether it is self-paying or choosing to take education loans, it is a large financial burden for families.
In the case of students suing Columbia University, Columbia University finally chose a partial refund, which will relieve the financial pressure of each student's family to a certain extent.
How expensive are American college tuition fees?
In the 2018-2019 academic year, the average tuition at a public university in the state was about $9,716, compared with about $35,676 at a typical private college, according to a college tuition ranking published by USNews, which also increased year-over-year based on inflation indicators.
USNews counted 737 national private universities (National Private University/College), with more than 100 private universities with tuition fees of at least $50,000 or more.
The tuition fees are high, and while it does not mean that all of them have to be paid out of their own pockets, I will introduce the tuition subsidies that can be applied for every year. The advantage is that they do not need to be repaid.
1. What is free tuition assistance (Financial aid)?
University Tuition Grants are used to help students pay for education-related expenses such as tuition, room and board, books and supplies, and transportation.
Among the types of tuition assistance, there are the following two,is Free Money without repayment : Grants, Scholarships.
These two free money,The application requirements are not harsh, it is not difficult to apply.According to 2020 data, 48% of households,All applied for grants, with an average of $6,030 per grant.
In 2020, 58% of families received scholarships (Scholarsips),An average of $7,923 per transaction.
Free tuition subsidies may not be enough for the tuition fees of prestigious schools and private schools.Grants and scholarship grants, according to a four-year public college tuition survey report,It only accounts for 4%-9% of the total college expenses for 12 years.
In order to make up for the tuition fee difference in the middle, JPMorgan hit the spot in one sentence,"Don't Just Save, Invest!" (Don't Just Save, Invest!)
2. 529 Education Fund Program
The most common way to invest in education and finance is to apply for the opening of a529 Education Fund Account, one-time, or on an annual or monthly basis to save money for financial management.
Regarding the 529 Education Fund, the most common misunderstanding is that you need to save enough money, such as XNUMX yuan or XNUMX yuan, to open an account.
This approach is indeed very suitable for grandparents, parents, and mothers to care for their children in one step at a time, and can put more than 30 US dollars at most at one time.But this way of filling two generations of a family at once is very rare.
As a long-term education and financial savings, many financial institutions allow families to invest as little as 100 yuan per month.
In addition to parents, grandparents can also deposit money into the same account every month, so it has a very high flexibility.
The disadvantage of the 529 education fund account is that the application for free financial aid has"Low Impacts"Impact.
3. Growth Life Insurance Plan
The impact on the application of tuition subsidies is almost zero, and at the same time, accidental life insurance is provided for children, and foreigners can also apply directly.This is the comparative advantage of opening a life insurance account for financial management of education funds.
The most common misconception about growth life insurance is,It is believed that the investment and financial management efficiency of life insurance accounts is not high.
By simply comparing the average annualized rate of return over the past 10 years, the selected growth life insurance account has beaten many 529 funds in terms of indicators, and the 15-year annualized rate of return has basically remained at the same level.
If you use a growth life insurance account for education savings and financial management, it is only suitable for families with young children or newborns.In terms of the breadth of the age range, the advantage is not as good as the 529 education fund account.
Article summary
"Which is the best education fund plan for my child?" My answer is, both are good.
Under the influence of time and compound interest, the sooner you open an account to invest in wealth management and start accumulating funds, the better it will be for you.
Due to the brands of 529 education funds and life insurance, there are just too many types.With the data support of professional consultants, we can analyze and compare the advantages and disadvantages of different financial account plans, and finally, according to the preferences of ourselves and our family, we can choose the preferred plan.
Families in need are also welcome to contact me and ask for it for free"2022 College Education Families Self-Help Planning Guide (Latest)".
(End of the article)
* "Columbia University to pay $12.5 mln to settle COVID-19 refund claims", 11/24/2021, Reuters.
* “How America Pays for College”, 2020, SallieMae.
* Finaid.org. Based on full-time students at four-year colleges.
