What to do about college?

Seniors in high school are pouring over acceptance letters trying to decide which college to attend in the fall. It’s an exciting time for students and parents. College is a fabulous experience, full of pomp and circumstance, football games, fraternities, sororities, student government, homecomings, etc. But what if you can’t physically attend college because of the Coronavirus?

Harvey Mudd, University of Chicago, USC, and Southern Methodist University all have annual tuition rates that cost more than $71,000.[1] Does it make sense to spend $71,000 for college if you are going to live at home to take courses online?

My sister and her family are wrestling with this issue as they ponder the schools my niece wants to attend in the fall. My niece has already lost the second half of her senior year of high school because of the shutdown, and it appears she may lose the fall semester too.

If students are going to balk at paying $71,000 to study from a laptop, is it time for community colleges to shine? To find out, I talked to Molly Beth Malcolm, Ed.D.  Dr. Malcolm is the Executive Vice President of campus operations and public affairs at Austin Community College. ACC opened in 1973 with 1,726 students on one campus, and it now serves more than 70,000 students across 11 campuses.[2]

Austin Community College is well-positioned to handle the online surge because last year, the school upgraded its IT infrastructure. As Dr. Malcolm mentioned the added capacity, she said, “It’s better to be lucky than good.” ACC has extended the online reach at three campuses to include parking lots so students who don’t have access to wi-fi can use the internet from their cars and continue to meet with other students – at a safe distance.  ACC bought 1,000 iPads to give to students in need, and the school is currently looking to purchase a thousand laptops. The school has spent $4 million to help students through these troubling times. Additionally, ACC has offered workshops to faculty members so that they can expand their online teaching presence through video meetings and web postings.

Community colleges are accessible and affordable. The annual tuition for ACC is $2,550, 96% less expensive than SMU. ACC has small classes, and students are required to meet with an academic coach. It’s “their highway” for the courses they ought to take to achieve their goals, added Dr. Malcolm. Dr. Malcolm also said ACC offers “wrap-around services.” What are wrap-around services? These services help students who are struggling financially to pay rent, utilities, or get gas for their car. The students can apply to the school for assistance through ACC’s emergency fund program – Keep A Dream Going. Austin Community College makes daycare services available for students.

ACC has a robust student life program where students can participate in student-government, intramurals, and theater. They also have a mascot – the Riverbat, and it makes several appearances around town and visits several elementary schools.

About 68% of students at ACC will acquire a bachelor’s degree within six years, according to Dr. Malcolm. She does encourage students to obtain their Associate of Arts degree if they decide not to continue their education, or they want to enter the workforce. “ACC is a critical partner to the region and to employers,” says Mike Perrine, chair of the Workforce Development Report Task Force.[3]

Dr. Malcolm expects a spike in enrollment due to the virus. She said community colleges usually experience an increase during times of crisis, but she said: “It’s always a great time to attend ACC.” In addition to students looking to transfer to a four-year college, ACC attracts individuals looking to change careers or improve their skills. The school offers several certificate programs.

ACC provides open enrollment allowing all who apply to attend. If students aren’t ready for college, the school offers college prep courses to help them get prepared for the road ahead.

What about safety? Dr. Malcolm oversees the school’s 93 police officers. ACC has a 24-hour police patrol, and each campus always has one or two police officers on the grounds.

Austin Community College is one of 50 community colleges in the State of Texas. According to the American Association of Community Colleges, there are 1,132 community colleges across the country.

If you are struggling with the decision to spend thousands of dollars for a virtual college experience, you’re not alone. My recommendation for the fall semester is to attend a community college and invest the money you were going to spend on tuition at a four-year university into a 529 College Savings Plan. A 529 allows your money to grow tax-free, and you can use the funds to pay for community college, undergraduate work, graduate school, law school, medical school, or certificate programs. If your child attends a community college for two years, you may be able to save enough money to pay for two to three years of tuition at a university.

Dr. Malcolm is a big advocate for community colleges, and she is passionate about her job. But, more importantly, she wants her students to succeed in life. She says to students, “We are not trying to get you out; we are trying to keep you in, so you can be successful.” She closed our interview by saying, “Students attend a university to get a degree, but they attend a community college to get a job.”

I attended Pasadena City College (Go Lancers!) for a year, and it was a valuable experience. My classes were small; the teachers were attentive. I grew up academically and emotionally during my year at PCC, and it opened my eyes to the college landscape, allowing me to attend a school that was a perfect match to continue my education – the University of San Diego. PCC gave me the tools needed to build a solid foundation for my future.

If you have not explored your community college lately, now is a great time to give it a look. You may be pleasantly surprised by what your local campus can offer.

Community colleges are the great American invention in terms of education. ~ Eduardo J. Padron

April 19, 2020

Bill Parrott, CFP®, is the President and CEO of Parrott Wealth Management located in Austin, Texas. Parrott Wealth Management is a fee-only, fiduciary, registered investment advisor firm. Our goal is to remove complexity, confusion, and worry from the investment and financial planning process so our clients can pursue a life of purpose. Our firm does not have an asset or fee minimum, and we work with anybody who needs financial help regardless of age, income, or asset level. PWM’s custodian is TD Ameritrade, and our annual fee starts at .5% of your assets and drops depending on the level of your assets.

Note: Investments are not guaranteed and do involve risk. Your returns may differ from those posted in this blog. PWM is not a tax advisor, nor do we give tax advice. Please consult your tax advisor for items that are specific to your situation. Options involve risk and aren’t suitable for every investor.

 

 

 

 

 

 

 

 

 

[1] https://www.statista.com/statistics/244041/most-expensive-colleges-in-the-us/, website accessed April 19, 2020.

[2] https://www.austincc.edu/about-acc

[3] https://www.austincc.edu/news/2019/08/acc-examines-urgent-workforce-needs-new-workforce-development-report, submitted by Sydney Pruitt.