American Education｜Are Scholarships and Student Loans Enough to Attend College?

The cost of almost everything has gone up within these recent two years! However, there is one particular cost that has been on a steady rise for decades. The average person may not even realize how surprising the cost of getting a higher education in America has grown over the years.

In recent reports, the consumer price index has shown to have increased by 8.3%, However, did you know that according to statistics, the cost of education from 2002 to 2022 has undergone an annual growth rate of 5.2%? With or without considering the factors of inflation, the overall cost of tuition has increased by as much as 1.8 times. On top of inflation, tuition fees have increased by 3% each year. At the time, everyone was unaware of how astonishing the cost of tuition has risen. In the past, fluctuations of inflation varied within 2%; however, the stark increase within these two recent years has everyone concerned. Yet, no one had said anything about the rise in the cost of tuition over the past 10 years.

Some believe that scholarships will be given when they attend college. However, one must have amazing talents and excellent qualifications in order to receive them. The amount provided by the scholarship must also be considered. If one does not qualify for a scholarship, one may apply for grants or other student loans based on the family’s income status and assets. If you are an office worker, and your annual reported income exceeds USD80,000, then the chances of applying for scholarships or grants are very slim.

Some may feel that getting a student loan may be a good option, as the interest rate for a student loan may not be as high. However, this is not always the case, as there are many factors and stipulations for obtaining a student loan listed in the details. Such factors include, whom you wish to obtain a loan from, the purpose of your study, whose name it will be under, etc. Corresponding interest rates will apply according to different scenarios. The lowest interest rate for obtaining a student loan is 3.7%, and the highest may be around 12% per annum. You might be wondering why there exists a huge range of differences. An individual has once taken out a student loan based on a 12% interest rate. Of course, there are many factors and measures involved when calculating the interest rates of student loans. For instance, daily interest rates can be calculated based on simple or compound interest rates. Just the thought of it can become overwhelming. The federal union’s calculation is based on simple interest; however, some private student loans are calculated on the basis of compound interest. You will notice there is a significant difference in the calculations based on simple or compound interest rates.

From the above, we see that grants and student loans are not easily obtainable. It is far from enough to cover the cost of tuition just from the loans alone. So how can we provide the funding for our children’s education and our later years during retirement? For details, you can contact our TransGlobal Group to learn more. We have a dedicated team of professionals who can answer all your questions. For more information, please call 888-831-8868.

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Please contact the local agent of TransGlobal today or call 888-831-8868.

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