Volume 11, Number 1, Fall 1997 |
In This Issue: Training and Careers Community and Technical Colleges Money Talk
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College Tax Credits for Christmas
On August 16, 1997, The U.S. Department of Education provided details on new tax cuts "to make college and lifetime learning more affordable." Several major new programs provide students and families with options to reduce the financial impact of the cost of college.
The HOPE Scholarship tax credit is advertized as helping make the first two years of college universally available. It offers parents of dependent students (under the age of 24), or independant students, a 100% tax credit on the first $1,000 of tuition and required fees and a 50% tax credit on the second $1,000. This means that parent or student will be able to take up to a $1,500 tax credit per year, on tuition paid after December 31, 1997. The credit can be claimed in the first two years or vocational school for students who are enrolled at least half-time. The credit is phased out for families with incomes beyond $80,000 per year, or individuals with incomes above $40,000. The credit is not available if tuition is covered by grants, scholarships or other tax-free college aid.
The Lifetime Learning tax credit is targeted to college juniors, seniors and adults returning to college. It offers a 20% tax credit for the first $5,000 of tuition and fees paid each year, beginning after July 1, 1998. After 2002, the credit will be increased to cover the first $10,000 paid. This credit is also phased out at the same income levels as the HOPE Scholarship. The credit is also not available if tuition is covered by grants, scholarships or other tax-free college aid.
IRA Funds Available for College Beginning January 1, 1998, parents and grandparents may withdraw Individual Retirement Account funds, without penalty (treated as regular income), to use for the college expenses of the taxpayer, a spouse, child or grandchild. For children under the age of 18, $500 per year may be deposited in an 'Education IRA' in the child's name. Earnings on the Education IRA are tax free and no taxes will be due upon withdrawl if used for college tuition and fees, until the child reaches 30 years of age. This benefit is phased out for families with incomes above $150,000 and individuals above $95,000.
source: U.S. Department of Education, for clarification
call 1-800-4FED-AID
Finding a Balance between Learning and Lifestyle
The decision whether to attend college as a full, half or part time student depends on many factors. Coupled with this question is the one of employment; whether to work full-time, part-time or at all while attending classes. Few students have the economic freedom to forgo working during their college years. The question then becomes how to combine the quickest way of completing an education with the greatest financial security.
Full or half-time enrollment makes sense when the primary and immediate goal in a student's life is to earn an undergraduate or graduate degree, or when the degree is part of a larger life change (career or relocation.) Full to half-time status also makes sense when scholarships, fellowships, grants or assistanceships are available.
Part-time status makes sense for students who want to warm up their academic skills before enrolling full-time or for those who don't want to relinquish their present lifestyle or job, where the pressure to earn the degree is not as great. Part-time enrollment offers the flexibility needed to maintain careers and families while also attending class. The decision to attend class full, half or part-time generally comes down to non-academic factors: jobs, family, money, commuting time, etc. It is important to ask the admission and financial aid officers at each college what their policies are toward part-time students. Financial aid is more limited for part-time students. Course and degree options may be limited as well. If you are uncertain as to the most appropriate way for you to attend college, do some investigation. Inquire about the programs that interest you - they may only be offered to full-time students, or you may be able to build up to full-time enrollment after a period of part-time enrollment. Going to school will change your lifestyle, personally and financially. There are a variety of ways to do it. The more options you consider, the better able you will be to define your needs and meet them.
Major Shortage of Computer Programmers
"It's not just the money, it's availability. Even if I had $60,000 to pay a programmer, they're just not applying."
Mark Cain , Executive Director - Information Services College of Mount St. Joseph
Colleges and the business community are searching everywhere for qualified
individuals to fill computer programmer positions. According to the Chronicle
of Higher Education (9/5/97), the market for computer programmers is so
competitive that one in ten positions advertized, simply go un-filled. College
graduates with computer science degrees in 1986 totaled about 42,000. In
1995, just 24,404 such degrees were awarded. The result is a job-seekers
market.
The business world is not recruiting computer programmers who work for colleges,
offering salaries that the colleges cannot match. While the number students
majoring in computer science has declined, the job market for these individuals
has exploded. Computer programming grads are being heavily recruited right
out of college with salaries as high as $60,000 per year. With the rapid
expansion of the Internet and other computing needs, this demand is not
expected to decline any time soon.
For students considering a college major, computer science currently offers
job options and salary levels that few other degrees can provide. At all
degree levels, associate, bachelor's and graduate, far more jobs than applicants
are available. Some speculate that the reason students might avoid computer
science is due to the 'geek factor.' As one college administrator noted,
"There's never been a TV show called 'LA Computer Science.' It's just
not thought of as a cool thing to do." Cool or not, computer programmers
are having the last laugh, on their way to the bank.
Making Your Own Map - Success at a 2-Year College
Is sometimes assumed that attending a community or technical colleges is 'easier' than attending a 4-year college or university. Not only is this false, the reverse is often true. Community and technical colleges can be more challanging than their 4-year counterparts.
The classroom experience at both 2 and 4-year colleges is of equal difficulty for equal courses. English 101 at a large university should not differ in any significant way from English 101 at a community college. Of course, every college has different levels of teaching expertice and the quality of the faculty can vary. One of the biggest differences between 2 and 4-year colleges is what happens outside the classroom.
The average age at many 2-year colleges is over 30. Community and technical colleges are convenient to adults, returning to higher education. Un-like many 18-24 year old students, adults have little interest is the many activities and support services provided by colleges outside of the classroom. At many 2-year schools, these activities or services are entirely optional. For young adults these services may provide essential counseling, advising or tutoring support but it is up to the individual to seek out these support areas. The challenge is in deciding which services or activities are appropriate (see accompanying article).
At 4-year colleges, students are counseled more closely on their extra-cirricular choices. Often, a student's academic progress is also monitored to be sure that the college is aware of potential problems. This seldom happens at 2-year colleges. Here, it is necessary for each student to consider their own progress and decide if additional campus resources are needed. Don't expect to be coached through admission, financial aid or registration. The student at a community or technical college who waits for someone to guide them through campus life will not be rewarded.
Community and technical colleges have many resources to offer students. Below are some tips to take advantage of the services and activities provided.
When a future employer reads your resume, are they going to care about where you went to college? The answer may suprise you. Once you get past your first job out of college, most employers give little consideration to the college name on your diploma.
Dr. Andrew Hacker is the author of Money: Who Has How Much and Why, a new book about the power of money. In his book, Dr. Hacker also focuses on the role of education in determining wealth. He states that Americans cannot get by on less than a bachelor's degree and an advanced degree is preferred. Then he goes on to say, "Once you get the B.A., it can be from Texas Tech or Saint Olaf, and within a short period of time that's good enough." He says simply that it is largely immaterial which institution grants the degree.
Whie some might disagree with Dr. Hacker, it is hard to argue with his statistics. He notes that out of the executives of the country's 100 largest companies, only 11 attended Ivy League universities. The majority attended local public or private colleges. How important then is a college's name recognition in the college selection process?
For some students, it's a confidence booster to be accepted for admission at a high-profile college. The actual admission decision may give other selection factors primary importance. Most important, the student must match up well with their college of choice. Program choice, location and financial considerations are the key ingrediants for many students and their families today. With colleges as with other major financial decisions, the product is always more important than the label. Do high profile colleges deserve their fine reputation? Certainly they do, but image is not a guarenty that this is the right college for you the student. Look beyond the packaging and find the college that offers academic excellence with the least disruption to your lifestyle or finances and you will be making the right choice.
A Consumer's Guide to the Admission Process
Admission methods change from one college to the next. For degree candidates, the selection process will be more thorough than for non-degree candidates. Most colleges assume that degree candidates will enter in the fall term, and the selection process becomes a yearly cycle, in one of three ways: rolling, regular or early.
Rolling admission programs set a date when the college will begin accepting applications - usually in December or January. Like 'first-come, first-served, rolling admission applications are reviewed as they are received, and are decided upon within 4-6 weeks. There is no specific application or notification deadline - but it is advanta-geous to apply earlier rather than later.
Regular admission refers to colleges which set a specific date when applications are due (usually January or February), and they set a notification date as well (usually in early May.) In this way, the selection committee can review the whole applicant pool at the same time, rather than person by person as in rolling admission.
Early admission programs are designed for students who are certain of their first choice college. The student applies in the fall (usually November) and hears within a month. There are two kinds of early programs: early action and early decision. Early decision involves a commitment on the student's part - so that if accepted, the student is automatically matriculated. Early action, on the other hand, does not involve that commitment. The student accepted under early action programs has until late spring to notify the school whether or not he/she will attend.
In both early admission programs, students can be accepted (generally it is very competitive), rejected (usually only those who clearly would not be accepted in regular action), or deferred. Deferred students are automatically reviewed in the spring with the "regular" pool and colleges often accept additional information to up-date the deferred student's application.
Service Learning - College Credit for Community Service
Many colleges are encouraging students to combine their academic studies with community service. Known as 'service learning', students receive college credit for volunteer work in the community. The usual process is for the student to spend several hours a week as a volunteer, keep a diary of activities and prepare a paper or make a presentation as a final report.
In 1985, Campus Compact was started by college presidents to encourage service learning. Today, 520 colleges participate with 18 members in Washington State. The University of Washington has 22 courses that offer service learning. Seattle University and Seattle Pacific University also offer service learning opportunities. At Seattle Pacific, over 20,000 hours of community service are provided by students each year. At Seattle University, students provide diverse services such as having business and accounting students help local residents fill out IRS tax forms.
Several added benefits of service learning are that it may contribute toward eligibility for merit scholarships and can provide students with connections to job offers after graduation. Ideally, students select volunteer work where they already have an interest or skill to offer.
source: Seattle Post Intelligencer, 6/2/97
Quick Takes - Admission Numbers from the University of Washington
For Fall 1997, the UW welcomed the largest freshman class ever, 4,400 students. 7,640 applications were received from Washington Residents, of which 6,751 or 88% were offered admission. From out-of-state, 52% of the 5,243 applicants received offers of admission. Washington residents make up 85% of entering freshman. Applications for the 1998-99 UW freshman class are due by January 31, 1998 and those received by January 1, 1998 are eligible for President's Scholars and Undergraduate Scholars merit awards.
Quick Takes - Seattle University welcomes New Students and New President
Almost 6,000 students started classes on September 24th at Seattle University. Several new programs were also introduced on campus. These included a cross-cultural communication program, allowing students to study abroad in China and the opening of the new Institute for Ecumenical Theological Studies. Seattle University also welcomed the Reverend Stephen V. Sundborg, S.J., as the institution's 21st President. The University expects to begin building a new School of Law in February 1998.
In 1980, student loans were only 30% of all college financial aid. In 1995-96 they are 76% of available federal aid and growing. Between 1991-92 and 1995-96, federal loans to college students grew 95%. In 1995-96, $28.3 billion in education loans were borrowed by students and parents. By the time students pay off these loans, over $50 billion will be repayed when interest payments are included. The numbers for 1996-97 are not yet available but even more dramatic increases in student loans are expected and trends for 1997-98 may bring the single largest one-year jump ever recorded in student/parent borrowing.
The burden of paying for college has been firmly placed on the backs of students and their families. During the same five year period shown below, the Federal Pell Grant Program increased only 4% with an actual decline in the number of recipients. The message today is very clear. If you want to go to college, borrow the money.
What is not so clear, is how this fundimental shift in college financing from students and parents will effect our education systems and economy. Hard data is much more difficult to find but some points are clear. The most educated members of our society, college graduates, are carring substantial amounts of debts as they leave college. The average student receiving a 4 year degree has $13,500 is student loans. It is not uncommon to see students with over $40,000 in students loans after graduation. How likely are these recent graduates to be able to carry the financial obligations that most often follow college? Can they afford to get married and have children, start a business, buy a home, a new car or even furniture and appliances? Declining sales of new homes and new cars to young adults have been widely reported yet the possible tie to student loan debts has not been raised.
As a student or parent preparing for college, what can you do to minimize the negative impact that student loans might mean for your future? Be sure to exhaust all other sources of financial aid before considering loans. No student should use loans until all grants, scholarships and work study options have been fully explored. Consider COOP programs that combine work and study or seek employment with a company that offers educational benefits. Closely compare college costs. Which colleges offer the best value? Be clear on repayment terms and options if you do borrow. Student loans can open college doors for families in need but they should not at the same time be closing career, family or lifestyle opportunities after graduation.
Loan Program 1991-92 1995-96 Five year borrowers/avg. amt. Tot Loans borrowers/avg.amt. Tot. Loans % Increase Perkins Loans 660,000 - $1,248 $800 mil. 776,000 - $1,233 $1 bil. + 25% Subsidised Stafford Loan 3,854,000 - $2,761$10.6 bil. 4,674,000 - $3,450 $16.1 bil + 52% Un-subsidised Stafford 670,000 - $2,951 $2 bil. 2,450,000 - $3,590 $8.8 bil. +340% Loan (previously SLS) PLUS Parent Loans 348,000 - $3,234 $1.1 bil. 426,000 - $5,716 $2.4 bil. +118% Total Federal Loans $14.5 bil. $28.3 bil + 95% recipients/avg. amt. recipients/avg. amt Federal Pell Grants 4,027,000 - $1,302 $5.2 bil. 3,600,000 - $1,502 $5.4 bil. + 04%
source: The Chronical of Higher Education, Almanac Issues - 1991-92, 1995-96
Student Loan Interest Now Deductible
Students or parents with federal education loans may take a tax deduction
for interest paid in the first 60 months of repaymenton. The maximum deduction
is $1,000 in 1998, $1,500 in 1999, $2,000 in 2000 and $2,500 in 2001 and
beyond. The deduction is phased out for families with incomes beyond $60,000,
and for individuals beyond $40,000. The deduction is available on all federal
educational loans made before August 1997, but only if they are still in
the first 60 months of repayment.
UPDATED SCHOLSHIP LISTINGS FOR 1998-99
(samples from the Pacific Northwest Scholarship Guide - upcoming 1998 7th edition)
Albert Mann Memorial Scholarship
c/o College Planning Network
Campion Tower - 914 E. Jefferson
Seattle, WA 98122-5366
Contact: Vicki Breithaupt
Phone: (206) 323-0624
Deadline: February 15 Amount: $1,000
Renewable: yes No. of Awards: 1-2
On-line Application: http://www.collegeplan.org
Eligibility: geographic (WA) high school junior
Criteria &Procedures: A completed application, with essay, activity list, and recommendations. An official transcript from the high school or college the student is currently attending or if not currently in school, an official transcript from the last school they attended. Achieving students are encouraged to apply (GPA between 2.5 and 3.5). Academic achievement counts for only 10% of the decision. Leadership and community service are key criteria.
Microsoft Scholarship Program
Contact: Laurie Swift
Phone: (206) 882-8080
Deadline: Amount: $2,500
Renewable: Number of Awards: 4
On-line Application: http://www.microsoft.com/education/k12/resource/msschlr.htm
Eligibility: Geographic High School
Criteria &Procedures: Local Techinal Scholarship (2 X $2,500), is targeted at East King County and Seattle area high schools. A 3.0 GPA is required and financial need is not a factor. Seniors pursuing degrees in math science or engineering are encourged to apply ( with a specific interest in Sciences preferred. The scholarship is merit based.
Minority Scholarship Program (2 X $2,500), is targeted at Seattle area high schools. Seniors pursuing a four year degree in math, science, or engineering will be encouraged to apply (with a specific interest in Computer Sciences preferred).
Students must be African American, Hispanic, or Native American to apply.
BECU Foundation Scholarship
Boeing Employees' Credit Union
Financial Counseling and Education
P.O. Box 97050
Seattle, WA 98124-9750
Contact T. Skott Pope
Phone (800)233-2328 ext. 5037
Deadline: June 1 Amount: $2,000
Renewable: Number of Awards: 25
On-line Application: http://www.becu.org
Eligibility: Family Affiliation ,High School, Undergraduate,Graduate,Returning
Critera &Procedures: Applicants must be a member of BECU (employee or relative of Boeing employee), be a graduating senior in high school or current college student with a GPA of 3.0 or higher. Notification of recipients is by July 15th.
Material in Beyond High School is published
quarterly by the nonprofit College Planning Network, Campion Tower,
914 E. Jefferson, Seattle, WA 98122, (206) 323-0624. President and Editor:
Douglas J. Breithaupt; Designer: Castonguay Design; Illustrator: Kiam Wright.
Material may be reproduced with acknowledgment of the source.
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