Here's the Latest School to Make College Free
Plus, register now for tomorrow’s webinar on where crypto is headed in 2023
Ric Edelman: It's Monday, February 6th. Hey, tomorrow at 3 p.m. Eastern time, I'm hosting a one-hour webinar, What's Coming for Crypto in 2023. Yeah, I know we're already in 2023, but work with me here, people. Hey, is crypto going to grow mainstream this year? Is the crypto winter going to end? Are we going to see new laws and regulations as a result of FTX? Are crypto prices going to fall or are they going to hit all-time highs? Join me and Matt Hougan of Bitwise Asset Management. We're going to tackle all of this tomorrow, 3 pm Eastern time in a one-hour webinar. This event is for financial advisors. It's free. Advisors get one CE credit for attending. You can register for free at DACFP.com.
Today, though, I want to talk with you about college. There’s big news from the University of Maryland. It's the latest institution to make college free. Yeah, students from low-income families won't have to pay for tuition or fees. You've got to be a Maryland resident and you've got to be a recipient of a Federal Pell Grant. The most you can get from Pell Grants is about $7,000. But at the University of Maryland, their in-state tuition and fees are $11,000. So the university is going to cover the extra $4,000 as a result of this new program. They say that nearly 5,000 students are going to end up with a free college degree.
Now, this program only covers tuition and fees. What about room and board? That's another $15,000 a year at the University of Maryland. And so the university is going to pay half of that as well. Everybody needs money. That's why they call it money. This is big news. But the University of Maryland is not the only college giving away free degrees. Dozens of schools now do something like this. The University of Virginia, UMC, Michigan, Antioch, University of New Hampshire, Stanford, Princeton, Yale, Harvard, Duke, Louisiana State, Vanderbilt, Cornell, Columbia, Brown, Penn, Dartmouth, Alice Lloyd, Berkeley and a lot more. A lot of states as well are beginning to offer free college, too, for their residents. You can get a four-year degree at state colleges if you live in Colorado, Indiana, Iowa, Louisiana, Massachusetts, Minnesota, New Mexico, New York, Oklahoma, Washington, Wyoming. And 31 states are now offering free two-year associate degrees.
And if that's not enough, a lot of companies are now paying for college for their employees. Fidelity, Chipotle, Starbucks, Walmart, Amazon, Macy's, JPMorgan Chase, Boeing, Discover, Disney, Papa John's, Target, Verizon, Taco Bell, T-Mobile, Home Depot, Lowe's, Publix, Qualcomm, Waste Management, and so many more. Not to mention, the US Armed Forces.
For decades, one of the biggest challenges that parents have had is college planning, because we know that the average cost of a degree now can be $100,000, $200,000 and $300,000 depending on the college you go to in the field of study and whether or not you need to send your kid to grad school or an advanced degree such as in law or medicine.
This is incredibly daunting. And oh, by the way, it gets compounded when you realize that cost is per kid. What do you do if you've got two or three of those kids in your household? This has been scary for every parent because they realize they've only got, what - 15 years per child to save? Because most parents don't begin to save for college until they already have children.
You might have 30 or 40 years to save for retirement. You've got 10 or 15 to save for college per kid. This is a really scary, daunting thing, especially since while you're trying to save for college for your children, you're also trying to save for your own retirement for yourself. And if that ain't bad enough, you're also trying to pay for your parent's retirement or long-term care needs because they saved insufficiently because when they were growing up it never occurred to them, they'd be living so long or incurring such costs in retirement. The so-called sandwich generation is where parents find themselves today.
Well, at least now we can take one of these three major burdens off the table. Yeah. You still got to save for your retirement. And yeah, you still got to care for your aging parents. But now, increasingly, you don't need to worry about saving money to send your children to college, because increasingly the options are growing for your children to get that degree, either free or at a substantially reduced cost.
If you're a financial advisor, you need to make sure you're altering your financial planning recommendations for your clients to adjust for this new dynamic so that you aren't scaring the heck out of your clients at the incredible costs they're going to incur and, not making them save money in a strategy that will prove to be unnecessary because of the changing dynamic of higher education. Make sure your advice is changing with the times, and at the same moment you'll be able to provide your clients with reassurance that their financial planning has just gotten dramatically easier.
And if you're the client, the investor, the parent; recognize that your financial future isn't going to be as daunting as at first you may have believed. You need to recognize that the need for saving for college is not as important. That allows you to focus on your own retirement so that you don't become a burden to your children the way that maybe your parents are a burden to you. The world of personal finance is changing due to technological innovation, changing social norms and legislation and public policy. Make sure you're changing your financial planning along with it. And if you want to learn more about how your child can get a college degree without having that degree ruin their lives, watch my new master class on exactly that topic. It's available to you for free at TheTruthAYF.com.