Some Students Clamp Down as They Gear Up
By Jonathan Starkey
Washington Post Staff Writer
Sunday, August 2, 2009
Getting that college tuition and housing bill under control is only the first step. Then comes the comforter and refrigerator and textbooks and -- well, the College Board has a list of 118 to-buy items on its off-to-college checklist.
And don't forget the pizza money.
The bill to outfit a freshman can run to thousands of dollars if you're not careful, financial advisers say. As recession losses have whittled down college funds and as part-time jobs have become more elusive, families are finding creative ways to stretch each dollar.
In recent weeks, Sharon Okolicsanyi of Manassas has scoured the Web for deals on a laptop for her daughter, Helena, who will be a freshman at George Mason University. They finally found a bargain: It cost $499, marked down from $700. A security and software upgrade cost $100, and a printer cost $30, marked down from $70.
"I don't know much about computers," said Sharon Okolicsanyi, a teacher and single mother. "I had to keep looking and looking. I had to find the best deal."
In many ways, their summer has been defined by college-prep bargain-hunting.
On a recent trip, the Okolicsanyis picked up $68 worth of supplies, including spiral notebooks, pencils, dividers, pens and packs of paper. They also cut down the cost of an $80 "11-piece dorm-in-a-bag set" with a 20 percent coupon. Extra-long sheets, two towels and a hamper were included. More expensive pens were left behind.
On top of her loans, Sharon borrowed $500 to help cover expenses. As for pocket money, Helena, 18, plans to work part time through the federal work-study program and may rely on Mom for some extra money. She has already sought out a financial adviser on campus, and she is still awaiting word on a school scholarship.
"On the one hand, you want so much stuff," Helena said. "On the other, you don't want to pay for it."
Christine Parker, a financial planner and president of Parker Financial in La Plata, advises mindful preparation.
Parker used the checklist drawn up by the College Board -- best known for its SAT and other tests -- to estimate the cost of moving from home into the dorm. By her count, there's paper towels for $6.99, notebooks for $19.99, audio equipment for $64.64 and a computer-printer combo for $897. Toiletries, including tweezers and floss, add up to $245.77. Buying all 118 items on the list would cost $4,250.35, enough to "break the back of most American families," she wrote in an e-mail.
Parker suggests making a shopping list, so as to avoid emotional purchases. Rather than buying new, take as much as possible from home. Also "separate wants from needs," Parker said.
She suggests that parents sit down with students to draw up a budget for expenses at college. A good place to begin: How much will the student need each week to cover personal hygiene items, laundry, the phone bill, and a movie or food off campus?
"How much are you going to allow them? Or how are you going to help them understand what money they are going to spend?" Parker said. Some parents provide monthly allowances typically ranging from $100 to $500, she added. In 2008-2009, personal expenses averaged $1,906 nationally for a student living on campus at a four-year private school, according to the College Board.
Too often, students leave home with unrealistic ideas about spending and accrue giant credit card balances, Parker said. According to a study issued this year by student lender Sallie Mae, college freshmen carried a median credit card balance of $939, compared with $373 in 2004. The average for graduating seniors is more than $4,100.
"Most financial literacy for kids comes from their parents," Parker said. "You have to be actively involved. It's better if we're teaching them than letting the credit card companies teach them."
Parents should remember, too, Parker added, that the federal stimulus plan has broadened options for covering college costs. Now students can use 529 college savings plans to buy computers and pay for Internet service, for example. An expansion of one credit allows low- and middle-income families to offset up to $2,500 spent on qualified education-related costs, such as tuition, room and board, and books -- the other big academic expense.
Alexa Stott of North Brunswick, N.J., is headed to the University of Maryland and plans to save by renting her books online. Stott, 17, and her mother, Beverly, said she can cut book costs by half by renting from Chegg.com. Chegg will send Stott the books plus return packaging, which she'll use to ship the books back at the end of the semester.
The cost of textbooks can easily approach $700 a year, according to a committee that advises Congress on student aid.
Sharing books also pays in savings, experts say, as does searching for used textbooks on sites such as Amazon.com and eBay's Half.com. Texts for some courses are available free at the Flat World Knowledge site (http://www.flatworldknowledge.com), where students can also buy books and study aids.
"It's hard to get back what you spent" on books, Stott said. Renting, she said, "is going to save me a lot of money."
And again, some parents provide help with dorm-room essentials as well as cash. For graduation, Andrew Holleran's parents promised a laptop, which he just picked up at school at a discount. To outfit his room, he said, they were waiting to shop until early September, because by then "most students will have gone off to college, and there will be some sales." (But he's not getting an expensive new sound system, said his mother, Donna Holleran.)
As for day-to-day money, his parents have opened a checking account, where they'll deposit a couple of hundred dollars a month. They'll settle on a budget after a couple of quarters, once they have a more accurate idea of how much college life costs, Donna Holleran said. Andrew is the first of four siblings -- ages 18, 16, 15 and 11 -- expecting to go off to college.
"My husband and I haven't been in college for 25 years, so we are not exactly sure how it's going to play out," said Holleran, a stay-at-home mother.
The economy hasn't helped. She said she and her husband, a lawyer, lost 25 percent, or about $7,000, of money invested in a 529 college savings plan when the market tanked last year.
"We made the mistake of keeping his account aggressive a little bit too long," she said.
Andrew is doing his part, too. After a couple of months, he finally broke into the tight summer job market. Work starts this week in the clubhouse at a Northern Virginia golf course, and it couldn't come soon enough. Holleran will use his earnings, plus some savings and graduation gift cards, to cover day-to-day expenses during his freshman year at Ohio State University. School starts in late September.
"That's probably going to -- hopefully -- get me through the first year," he said.
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