Life & Style | Education

Climbing cost of that dream degree

Studying in the US is becoming ever more pricey, but there are options to mitigate the expense

  • By Peter Davos, Exclusive to Education
  • Published: 07:00 August 25, 2013
  • Gulf News

  • Image Credit: Getty Images
  • Picture for illustrative purposes only.
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Pursuing an education in the United States is becoming an incredibly expensive endeavour and tuition costs continue to rise, consistently outpacing the rate of overall inflation.

Many well-qualified international students hesitate to apply to colleges and universities in the US simply because of the sticker price, but options are available to mitigate costs.

Financial fit is just as important as any other criteria in determining which college or university is right for you and should be taken into consideration when conducting your college search.

While US institutions have resources that make higher education affordable for American students, the same level of funding is not available to international students.

In fact, colleges and universities are prohibiting from awarding any of the $125 billion in government aid to a student who is not a US citizen, permanent resident, or green-card holder.

Well-endowed universities, however, are able to offer merit-based financial aid to international applicants and the general rule is the wealthier the university, the more resources it will have available to defray the educational costs of international students.

For students applying to less wealthy universities, however, international applicants are often competing for a very small pool of money and are subject to different policies in terms of how available aid is awarded and how financial need affects the admissions process and the final decision.

Determine what an education will cost you

The total cost of attendance is a figure that includes much more than just tuition and fees. This figure includes housing, meal plans, books, supplies, local and international transportation, health insurance, and other incidentals. Combined, the sticker price for one academic year goes up drastically.

Recent data show that tuition at US institutions increases between 2 to 10 percent each year, so students and families must account for cost inflation in calculating the total cost of a US degree. Public universities have been hit particularly hard by the recent financial crisis and their fees have risen more dramatically in recent years than those of private universities.

To understand tuition amounts and estimated additional costs, look at each school’s admissions and financial aid pages, where you will often find information specifically directed toward international applicants. In addition to the institution’s own website, the US Department of Education’s College Navigator allows you to search for information on specific types of schools and compare data across institutions.

Understand financial need and the application process

Policies regarding financial aid for first-year international applicants vary from institution to institution and are closely linked to admissions policies for this group of applicants.

One factor that governs the relationship between financial aid and admissions practices is that immigration laws require verification of an admitted student’s financial resources before a student visa can be issued.

In fact, families must show that they have the funds available to cover the cost of attendance for one year - and at some schools, the duration of the program - by providing an official bank statement certifying their available financial resources.

Schools that have limited funds for international students employ a need-sensitive admission process in which they have to consider the student’s financial circumstances in deciding whom to admit. As a result, a large number of highly qualified applicants who are unable to meet the cost of attendance on their own or from third-party sources are ultimately denied admission.

While the majority of US institutions do not offer much financial aid for international applicants and some offer none at all, there are several institutions that in recent years have begun to apply the same need-blind admission process to international applicants as they do for domestic applicants. In need-blind admissions, the admissions committee will make the admissions decision solely on the basis of merit; admissions officers do not take into account the family’s ability to pay.

Schools like Harvard, MIT, and Yale are need-blind and promise to meet the full demonstrated financial need of each admitted applicant for all four years. These schools do not offer any merit-based aid per se - meaning that criteria like awards, test scores, GPA, athletics and other extracurricular interests play no part in qualifying students for funding - as the only criteria for securing such aid is being granted admission to the institution.

Harvard’s financial aid initiative goes one step further by promising that families with an annual income below $65,000 USD do not have to contribute anything towards the cost of attendance and that for families with an annual income of $150,000 USD or lower, the expected family contribution is no more than 10 percent of their income.

Seek out external sources of funding

International students that demonstrate financial and are less than confident about admission to a need-blind school like Harvard, MIT, or Yale, will undoubtedly have to look to third-party sources of funding or to a small group of schools that do offer aid to international students.

a) Start with resources in your home country. Are there government scholarships or subsidies available to students going abroad? Can you identify a sponsor who may provide support based on your intended field of study?

There are a number of databases with extensive scholarship listings that reveal scholarship opportunities after you complete a short questionnaire. FastWeb (www.fastweb.com) is one such database that will send you emails as new scholarships matching your profile are added.

Another good resources is the International Education Financial Aid database (www.iefa.org). Beware of any database or search engine that requires you to pay a registration fee and never pay a fee to apply for a scholarship.

b) Private loans are another option for international students and there are several lenders to choose from. Repayment will include the original loan amount plus interest, but lenders offer a number of different repayment plans.

A small group of international lenders have also begun to offer shariah compliant student loans. International loan applicants are required to have a co-signer who is a US citizen or permanent resident with an established history of good credit. If you plan to apply for an international student loan, start the process early as the whole approval process can take anywhere from two weeks to two months.

c) While finding a job once you begin your studies might seem like a promising way to fund your education, be aware that there are some restrictions on where and how much an international student can work.

Students on F1 visas are not allowed to work off-campus unless there are extenuating circumstances and the student is unable to find on-campus employment. However, they can work up to 20 hours per week on campus while classes are in session and can increase those hours during breaks. International students that graduate are also eligible to work in the US for one year in a job related to their field of study through the Optional Practical Training (OPT) program.

Keep an open mind

Being flexible about something like geographic location may mean a considerably lower cost of attendance. Use an online cost of living calculator to see how expenses other than tuition compare between locations to get a better idea of what your overall cost of attendance will be. Housing and food will cost less in cities like Houston and Atlanta than in New York City or Boston so limited funds are likely go further in the Southern part of the US, than in the Northeast.

You might also consider an alternative pathway to the degree you eventually want to earn. Community colleges in the US are becoming increasingly popular among international students not only because they often allow for a smoother transition to US higher education, but also because students are able to complete up to half of their degree at a fraction of what it would cost at a four-year institution. Students are then able to use the money they saved to complete their degrees at an institution with a higher perceived prestige.

Tips to remember:
  • 1) If financial aid is a big concern of yours, be prepared to broaden your college search.
  • 2) Follow instructions! Deadlines and application forms can differ widely from institution to institution so read web sites carefully and ask questions if you don’t understand something.
  • 3) Be creative in looking for funding. The earlier you begin your research, the greater your chances of amassing the funds you need.
  • 4) Be honest in the application process. If you demonstrate financial need and do not apply for financial aid in your first year, you are not likely to be considered for financial aid in subsequent years.
  • 2 to 10 per cent: The increasing costs of US each year
  • The total cost of attendance is a figure that includes much more than just tuition and fees.
  • This figure includes housing + meal plans + books + supplies + local and international transportation + health insurance + other incidentals.

Gulf News
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