Via LearnVest By Julie Halpert for The Fiscal Times ~
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When Julie Mayfield of Overland Park, Kansas decided to send her daughter to the University of Kansas last year, she didn’t count on all the extra expenses that added up. During her daughter’s freshman year, Mayfield paid $858 in required campus fees, $438 in technology fees, $130 for orientation, $190 for a parking pass and $150 for a sports and fitness pass.
But when her daughter decided to join a sorority, that’s when the costs really began to add up: There was $125 for rush registration, $2,247 in dues, $727 for a mom-and-dad’s weekend, family day and initiation luncheon, and $159 for a sorority pin. “I think parents have to get their heads around how much they are willing to pay for the college experience vs. the college education,” said Mayfield. “We want our children to have as many of the experiences as possible, but it can be costly.”
Mayfield is far from alone. According to an April, 2012, Merrill Edge Report by Bank of America, 56% of parents have paid or expect to pay more to send their first child to college than they had expected when the child was first born. When asked why, of those who currently have a child in college or have children who graduated, 64% say the college or university was more expensive than anticipated. An August 2012 report by Fidelity finds only 31% of parents with children heading to college consider the extra costs – causing most to fall short in savings.
While families often rely on a mix of student loans, scholarships and parents’ savings to foot the total bill, nearly two thirds of young adults between the ages of 19 and 22 receive financial help from their parents according to a recent survey from the University of Michigan-Ann Arbor. “I have seen parents’ eyes glaze over when they begin to realize that the amount of money they need to send their kids to college is much more than just tuition and fees,” says Charlie Nutt, executive director of The Global Community for Academic Advising.
According to a September, 2012, survey by New York-based marketing and research firm MRY, which specializes in youth trends, of 500 parents ages 45-65 with a child currently attending college full time, parents report spending over $7,000 each year in additional “hidden” costs – which adds up to $28,000 over four years.
Here is a glimpse into some of those costs that admissions counselors, in all likelihood, aren’t eager to trumpet during campus tours:
The Greek System
Dues cost an average of $2,000 a year, according to the National Panhellenic Conference. But they’re just one of the many fees associated with joining a fraternity or sorority. Costs for pledging activities, pinning, ceremonies and initiation fees can easily add up to $1,000 a semester, says Daryl Conte, educational consultant for American Student Assistance, a non-profit that helps students and alumni successfully manage college debt.
Hank Herman, author of Accept My Kid, Please! A Dad’s Descent into College Application Hell, says his son, a student at the University of Southern California, recently took part in his fraternity formal, dining at deluxe restaurants and staying in a luxurious Las Vegas hotel. Herman picked up the entire tab, which also included tuxedo rental and transportation. “It seemed like that’s where they were all going, so how could I put my foot down? It just comes with the territory,” he said.
Studying at a university in another country has become a rite of passage for many students. A record-high 270,604 U.S. students received academic credit for study abroad in 2009-10, up 4% from the previous year, according to the Institute of International Education. At If a student studies abroad through a program with its existing school, tuition costs could be equivalent – but not always. Travel and living expenses are usually extra, and parents often decide to visit their children abroad. Allan E. Goodman, president of the Institute of International Education, said that 10 years ago, that was unusual. But today, he says uniformly, even among students from socio-economically stressed parts of society, parents are thinking, “If my son or daughter is studying abroad, I’m going to find a way to go and see them.”
Although parents expect to pay for books, they’re often surprised at how expensive they are, especially for freshmen who are often less savvy about seeking out websites offering them at reduced cost. The average student spent $580 on textbooks in the 2011-2012 academic year, according to Student Monitor, which provides the only nationally syndicated longitudinal study of the U.S. college student market. The College Board’s number for books as well as supplies like book bags, notebooks, pens and pencils is $1,168 each year for a four-year public school and $1,213 for a private four-year institution.
Dorm Room Decor
Parents will spend an average of $907.22 to head back to campus and get dorm rooms looking spiffy, according to the National Retail Federation’s 2012 Back-to-College Survey, a number that has risen $100 since last year. Today, “must haves” include new laptops, printers, and clothes, according to a survey by MRY. Electronics are now considered prerequisites, says Herman. His son and his roommate were tremendous football fans, so he purchased a 40-inch flat screen television in their room to watch the games. “Things that used to be considered luxuries are now expected by a lot of college students,” Herman said.
Many universities automatically charge a fee for college health insurance and use of health services. That health fee can vary dramatically, from $200 at Allegheny College in Pennsylvania to $824 at New York City’s Columbia University. Students may be covered under a parent’s existing medical plan, so they could be doubly insured. To avoid this, it’s up to the parent or student to take the initiative to opt out of paying the college fee.
At the same time, private medical insurance may not cover unexpected medical costs if a student attends an out-of-state university. Parents assume that group health insurance policies cover out-of-state students at the same rate as in-state, which is not always the case, says Carrie McLean, a consumer health insurance expert from eHealthInsurance.com.
Clari Nolet, a financial adviser, says she’s paid for many extra items not included in the Division III school where her daughter played three varsity sports. She felt obligated to donate money or provide food for the tailgates after the games, as well as contribute to coaches’ gifts. Alison Tatham, CEO of The College Tourist, has a daughter who is on the crew team at a Division I school. The school asked for a $750 “donation” for spring training, which shocked her. “They don’t [explicitly] ask for the funds,” she says, but she felt compelled to pay the fee.
Fees assessed to students can include processing fees, technology fees, lab fees, student activity fees and athletic fees. In a report by the Center for College Affordability and Productivity (CCAP) conducted in January 2011, mandatory fees can add as much as 25% to the cost of tuition. Student fees at four-year public universities averaged more than $1,700 per year in 2008, the last year figures are available, according to the Department of Education. That’s up more than 36%, even after being adjusted for inflation, since 2000.
It’s not unusual for colleges to solicit students’ parents for money during fundraising drives and other events. While some resist the notion of spending even more money, others may feel it will help their student. Scott Barrett, assistant dean at the School of Information Studies at Syracuse University, says parents typically begin supporting the school when their children are attending as undergraduates, since they’re appreciative of the support their child is receiving and “want to provide opportunities for others.” He says the average gift from a parent in 2012 was slightly over $2,000.
Giving doesn’t generate special treatment for a student or a parent, he says, but he adds: “We often know our donors, and those extended relationships throughout the school do provide families with contacts that they may be able to take advantage of.” But that’s not the case at all schools. “We realize our current parents are generally doing all they can by paying tuition, room, and board, so we don’t generally solicit” them, says David Newberry, assistant vice president of Freed-Hardeman University in Henderson, Tennessee.
Schools usually charge a fee to park on campus, but that doesn’t include the often inevitable parking tickets. During his freshman year at Texas Christian University, John Grace’s son received numerous $75 campus tickets, along with $125 citations from the city for parking in fire lanes, totaling $900. He says most students at the school, even freshmen, have a car on campus and many, his son included, think they won’t get caught if they park illegally. Though irritated, Grace felt compelled to pay his son’s parking fines, fearing the school would not keep his son on as an active student if he didn’t.
If a child is far away, transportation costs – whether it’s bus fare, train fare, plane fares or gas costs – can be significant. Hank Herman shelled out $400 to fly his son home from Los Angeles to Connecticut four times this past academic year, and he and his wife also visited him at school. To save on airfare, the dad drove cross-country with his son’s beloved pet Beagle last year – a trip he’s taking again this year.
All of the above costs can escalate dramatically, of course, if a student spends more than four years in school. Parents may enroll a child presuming they’ll graduate in that time frame. But only 37.9% of full-time students who started college in 2004 graduated within four years, according to a March, 2012, report by the National Center for Education Statistics. Graduation can often be delayed when students can’t take a course they need and have to wait an extra semester or two to try again – or when students don’t take advantage of working with their academic advisers to develop a plan to graduate within four years, says Nutt. “Every semester past those four years is additional tuition, fees and living costs.”
LearnVest is the leading lifestyle and personal finance website for women.