The economics of higher education today is completely intimidating. It doesn’t matter whose statistics you choose to believe, the average undergraduate student is graduating with tens of thousands of dollars in debt. That debt can dictate employment options for the following decade or so, and may create a barrier to further academic pursuits. The value of a bachelor’s degree can be debated endlessly with no real resolution, but there is no question that it’s the only path to graduate work. And if the cost of a BA or a BS destroys ambitions for a higher degree its cost goes far beyond the student debt that’s been acquired.

A Practical Perspective

All of this suggests that a new perspective on undergraduate work may be in order. Unless you’re fortunate enough to have deep pockets supporting your education or you have earned a scholarship, it may not be practical to target the college of your dreams, but rather set a financial goal for the ensuing four years and see if you can meet it. This perspective is particularly relevant for students who are targeting a master’s degree; avoiding massive undergraduate debt is more important than the name of the school on the sheepskin.

The most obvious route to an “affordable” quality education is a public university. Many of them are among the finest large educational institutions in the nation, and the tuition rates are still a bargain although state budget crises are reducing the bargain factor yearly. Still, it costs less than $12,000 for a California resident to attend UC Berkeley; Schools in the State University System like San Jose State cost about half that. Tuition and books at a State University of New York (SUNY) campus is about $7,000. Those figures don’t include living expenses or transportation or other personal expenses, which brings up another cost saving option.

Bargain Basement College Credits

Community colleges are the best bargain in higher education today. Returning to our northern California example, tuition at any California Community College for a full time student is $312 per semester. Throw in the cost of books and the annual cost is still under $2,000 per year for a full time student. Couple that with a part time job and two more years living at home, and you’ve completed the first two years of college debt free. California is an example, but the ratios don’t change much in other states and in California, if you maintain a certain GPA for those first two years you are guaranteed admission to a state university in a vastly overcrowded system.

A degree from virtually any state college or university is perfectly respectable; the stigma that used to attach to transfer students is gone – graduate schools are primarily interested in your performance in upper division classes associated with your major. So now the challenge is getting through the junior and senior years without calling down an enormous student loan. One of the options is taking a part time approach, which can allow you to put in more hours on a part time job. If you knock your course load down by a third and attend summer school you can still finish on time.

The other option along this line is online courses or evening courses, which free up the day for employment. The SUNY Learning Network offers an astonishing number of online courses and degrees drawn from its 23 campuses. You have to enroll at the campus in order to take the course, which can be a hassle but not necessarily a major cost item. Many of the California State University campuses offer online classes as well, and the pattern repeats in other states.

Just because you sign up for some classes online doesn’t necessarily mean that you have to complete your entire degree in this manner. Many universities give you the opportunity to take classes both online and on-campus, which gives you the ultimate flexibility. If you want to work a few days a week and then enroll in classes on your days off, it is entirely possible by taking advantage of this option. Keep in mind that the less time you spend on campus, the more money you will save in terms of transportation costs and other expenses that arise when attending classes.

Majoring in Debt Management

We’re not suggesting that you can emerge from college debt free, but there are enough options available to undergraduate students such that someone with energy and a little discipline can complete a degree with a transcript worthy of consideration in one of the graduate programs you’ve targeted. Perhaps more important is the fact that student debt now becomes a consideration for undergraduate AND graduate school, a burden that will be manageable after five or six years of higher education that have left you with the education you set out to achieve

The following is a guest post from Greg McFarlane, author of “Control Your Cash: Making Money Make Sense“, a financial primer for people in their 20s and 30s who know nothing about money.

The housekeeper comes every second Thursday (it used to be every Thursday. We’re all hurting here.) She’s thorough, but methodical, which means if I want to get any work done I have to get out of the house.

Thus to The Coffee Bean & Tea Leaf, which beats Starbucks by virtue of having free internet for all customers – not just those with AT&T accounts. Nurse a $1.50 decaf for a couple of hours and no one bothers you. How CB&TL makes money under this arrangement is not this writer’s concern.

I sat at a table for 4. A few minutes later, a couple came in and asked to sit across (or as we say in the Intermountain West, “acrost”.) There were other tables available, but that didn’t seem worth mentioning. She was loud, and barked orders at an obsequious husband and, via the phone, what sounded like a realtor. The woman was so self-unconscious during her phone conversations that she recited her phone number and full name several times. This being 2010, that made it easy to determine where they’d moved from and even get a hazy idea of where the husband would be working.

They were shopping for apartments. In Las Vegas. A city with more foreclosures and bank-owned properties per capita than anywhere else in the country. As an advocate of better living through 30-year (and these days, 15-year) fixed-rate mortgages with 20% down, I groaned, thought better of opening my mouth, and waited for the wife to get up and locate something to eat.

I needed an icebreaker, so I asked the husband what attracted him to Nevada. Was it the 15% unemployment? How about the negative net migration? To his credit, the first thing he mentioned was the lack of a state income tax.

Regardless, why would an upwardly mobile couple rent an apartment when they can practically name their price for a house? The husband had 4 reasons, none of which made sense:

1. “We’re not sure which area we’re going to stay in.”

Then why would you hire a realtor? Who, by the way, has far less incentive get you into an apartment for a measly kickback from a property manager than she’d have to earn a commission for selling you a house.

Hiring a realtor costs you nothing out-of-pocket if you’re buying: the seller pays the realtor’s commission out of the sales price. Part of her job is to find you a neighborhood you’ll like living in, which means you don’t want a realtor who moved to town a month before you did.

2. “We have a 2-month-old.”

The logic being that when the 2-month-old becomes a 13-month-old, the family will require a larger house.

I should have asked for clarification. Perhaps the 2-month-old is a Siberian tiger. But assuming it’s a human, how much larger of a house do you need? We might be a throwaway society, but hopefully not to the point where we discard houses after a year or two of use for so capricious a reason.

Obviously, this objection wasn’t a real one. It was a public stand-in for “I suck at commitment. If you don’t believe me, look at the wife I settled for and am having second thoughts about.”

3. “We’ve got family staying in our house back in North Carolina.”

By all means then, live your life for them. Especially from 2000 miles away. If the family members are able-bodied, they can find somewhere else to live. If not, then you’re paying for care anyway, right?

Upon further prodding, my new friend admitted that he was renting his house to a cousin who’s attending college and paying $0 in rent. Impoverishing yourself to benefit a family member is one thing. But when that family member is a college student – i.e., at that one stage of life where it’s perfectly normal and maybe even a little humorous or romantic to be poor – there’s no excuse for it.

4. “I only have a 2-year contract at my job.”

It was at this point that I unscrewed a table leg, reached over my laptop and beat the man into unconsciousness. (Editor’s note: figuratively speaking of course!)

I wanted to ask how short a contract he’d need to agree to buy a house. 30 years was the upper bound, sure, but could he go lower than that?

Home prices are historically low. Interest rates are, too. They’ve never been this low in concert, ever. Unless your credit is atrocious, there’s a house out there for you somewhere: an asset selling for a subterranean price.

The same people who palpitate when Best Buy or Macy’s has a 30% off sale will stand inertial when houses do the same. Why? Maybe because even at or near the nadir of the housing market, the prices remain in the psychologically treacherous high 5/low 6-digit range. Or perhaps because there’s so much of that tedious paperwork involved.

Whichever excuse fits best, there’s never been a better time to buy a house. The IRS brain trust still allows big mortgage deductions, for now. The nation’s population is still increasing, as is the concomitant demand for shelter. Yet for those renters committed to being noncommittal, no market conditions will convince them to seize a glaring opportunity.

The couple seemed clean and responsible. The husband clearly has a regular job. They’ll help make some landlord very happy, and very rich.