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Investing in your Education

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Postsecondary Education is an investment in YOUR future!

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Did you know?An investment is a financial

expense you make today in order to get a return – or money back –

in the future.

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Sample Investments:

•Buying real estate and flipping houses.

•Investing in the stock market

•Getting more education to raise your

income level over time

•Collecting antique coins or comic books and

then reselling them at a profit.

THINK IT THROUGHSome investments are riskier than

others. How do you know a smart investment when you

see one?

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Costs of CollegeEvery investment has costs.

There are different types of costs you encounter when you invest in your future through postsecondary education.

These include:

Financial costs like tuition, books, room and board, technology and transportation.

Opportunity costs like not being able to work full time, not being able to start your career right away, not being able to support a family right away

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Grants

Loans

Scholarships

Work Study

Ways to Pay For College: Financial Aid Types

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• “Free money”• Money given to you

based on your financial need.

• Institutional and federal grants can cover a lot of the cost.

• You need to qualify for the grants.

• You don’t have to pay them back. Ever.

Grants

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• Free money.• Money awarded to

students who meet certain academic or activity based criteria.

• Often have to apply• You don’t have to pay

them back. Ever.

Scholarships

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• Work for the school while you are in school!

• The school pays you to work for it.

• Awarded on a need basis.

• You never have to pay it back. Ever.

Work Study

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• Money you borrow from the bank or from the government.

• Has to be paid back plus interest.

• Interest rates for student loans are much lower than for other types of loans.

Loans

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How It Works: Financial Aid At-a-Glance

Cost of Attendance - Family

Contribution =Your

Financial Need

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How It Works: Financial Aid Packages

Grants:$10,000

Loans:$15,000 over four years

Scholarships:$2500

Work Study:$2,500

Each school creates a Financial Aid Package for you based on your financial need:

For example, $30,000 could be covered by a combination of:

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How It Works: Student Loans

Most students get grants, scholarships and work study too. But if you don’t, remember that federal student loans have a low interest rate of 4-10%.

If you borrow $30,000 in loans over two-four years to pay for your education:

Cost per month while you are a student (and six months after you graduate): $0

Cost per month six months after graduation (when repayment begins): About $60/ month

Affect on your earning potential: As soon as you begin earning post-secondary credits, your earning potential rises.

Affect on your earning potential: When you finish a degree, your earning potential rises exponentially. Check out these career examples…

TODAY:Initial Investment Costs and

Return

TOMORROW:Ongoing Costs and Return

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Xray Technician (2 year degree)Total borrowed: $15,000Monthly Income: $2,800Monthly Loan payment: $30

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Nurse (4 year degree)Total borrowed: $30,000Monthly Income: $3,300Monthly Loan payment: $60

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Pediatrician (4 year + Advanced degree)Total borrowed: $60,000Monthly Income: $9,000Monthly Loan payment: $120

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How It Works: High Interest LoansIf you borrow $30,000 to buy a fancy car at 7% interest:

Cost per month as soon as you drive off the lot: $325

Cost per month in 5-10 years after buying the car: $325

How much the car is worth: Less than you paid for it – maybe $20,0000?

How much the car is worth: Much less than you paid for it – maybe $10,000?

TODAY:Initial Investment Costs and

Return

TOMORROW:Ongoing Costs and Return

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So investing in your education is smart…

…because the costs are far less than the return, and the risk is minimal.

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So how do you start making smart investments?

1. Research your financial aid options in 11th grade by starting a scholarship list

and a personal financial portfolio.

2. Apply for financial aid starting in your senior year.

And as always…see your Launch and Navigator books, CSNav and your College Summit teacher for help!