written by TOM LAURICELLA
Posted by Minjune Kim
Going back to college later in life is a great way to bolster a career, re-enter the job market or simply expand horizons. And it doesn't have to cost a fortune. Not only can adults benefit from most of the same financial-aid programs and college-savings plans as recent high-school graduates, there also are options for older adults alone -- which can significantly reduce the cost of learning.
Tom Miller, a 68-year-old former Marine and art director for a Wall Street firm, is on his second round of going back to school. And that's on top of the master's degree in fine art he earned earlier in life. Between 1997 and 2003, Mr. Miller used his veterans benefits, which help cover the cost of education, to save more than 80% on his tuition as he earned a certificate in entrepreneurial studies and business management at Fairleigh Dickinson University in New Jersey. Today, he takes an art class at that same college for just $250 per semester, through a Fairleigh Dickinson program for older adults called the Florham Institute for Lifelong Learning. A typical class at the university is three credits and costs $2,511, or $837 per credit, though it can vary. Both financially and from a personal fulfillment standpoint, "it's very rewarding," Mr. Miller says.
For those looking for help with the cost of going back to school, a good first stop is financial-aid site FinAid.org. It provides a wealth of information on loans and scholarships, including a page on financial aid for older students. (Click on a link on the home page that says "other types of aid.")
When it comes to financial aid for older students, "if you're pursuing a degree, just about everything that works for a traditional 17-year-old will work for you," says Mark Kantrowitz, publisher of FinAid.org. He adds that there even are some schools that offer scholarships just for older adults. That said, there are some restrictions that may pose a problem for some senior students. For instance, the federally sponsored Pell Grants program, which provides money to low-income students, is available only to those who don't already have a bachelor's degree.
Older students also may have their own concerns. Mr. Kantrowitz hears from individuals who need a student loan but worry about what would happen if they die before the debt is paid off. "It's a bit morbid, but it is a concern...that the loan will be held against the estate," he says. With the federal Stafford loan program, however, the debt is forgiven should the borrower die.
Many older adults will find they may not need to pay full tuition. Purdue University in Indiana, for example, waives half the tuition for people age 60 and older (but with a cap on the number of credits taken with the discount). It's even cheaper for those who don't want to pursue a full degree. Most schools provide bigger discounts for students who "audit" classes; they participate in class but don't take tests or get credit toward a degree. At the C.W. Post Campus of Long Island University in New York, anyone 65 or older auditing a class pays one-quarter of the regular tuition. That lowers the cost of a typical class to about $640, from more than $2,500. And in more than 20 states, including Texas, Florida and North Carolina, public colleges offer free tuition to older adults auditing classes. One thing to remember: Space may be limited, and schools usually give priority to for-credit students. Moreover, some schools restrict when audit students can register. At C.W. Post, for example, registration for audit students is allowed only the week before school starts. "But it usually seems to work," says Rita Jorgensen, director of adult student services at the school.
Consider 529 Plans
It also pays to consider another tool that has become common for younger students: 529 college-savings plans. These accounts allow money used for college expenses to be invested free from federal income taxes. Many states also offer tax breaks for contributing to 529 accounts.
"It's almost a no-brainer," says Joseph Hurley, who runs Savingforcollege.com, a Web site specializing in 529 plans. That said, those planning on attending school within the next several years should be wary of putting money into investments that could lose money. And a handful of states, such as Louisiana, have minimums on how long money has to be in an account before it's withdrawn in order to receive the full benefits of the accounts. Still, Mr. Hurley notes that some state programs, such as Michigan's, have investment options that offer high-yielding but safe accounts. Michigan's Principal Plus Interest Option currently provides a 3.75% guaranteed return from plan manager TIAA-CREF. That rate could change at the end of September. Some people may be able to take advantage of 529 accounts opened for children or grandchildren. "You can always change the beneficiary back to yourself, or you can open [accounts] with yourself as the beneficiary," says Mr. Hurley.