New College Financial Aid Program Aims to Get Students Jobs, Not Debt Consumer Reports Tue, Aug 16 5:27 PM PDT The Obama administration is tackling two key problems in higher education today: Too many students go into debt to get a college degree, and too few land a job that puts their expensive education to use. Today, the Department of Education announced a pilot program, the Educational Quality Through Innovation Partnerships (EQUIP), that for the first time will give federal financial aid to students enrolled in nontraditional education programs, such as coding boot camps, online courses and corporation-based training initiatives. The aim is to give more students the chance to get trained for in-demand jobs quickly and affordably. In its pilot phase, the financial aid initiative will give up to $17 million in grants and loans to students enrolled in eight programs that have been preselected. The programs are partnerships between public universities and less-traditional education providers. All provide students protections, including refunds if they don’t get jobs after completing their training. Training Future Engineers and Managers EQUIP programs, which are largely focused on providing skills needed for high-tech jobs, include: Colorado State University Global Campus and Guild Education. A one-year certificate program in management and leadership fundamentals aimed at helping students move from low-wage jobs into supervisory roles. Marylhurst University in Oregon and Epicodus. A 27-week certificate program in web and mobile software development for low-income students to get jobs requiring computer software coding skills. Northeastern University and General Electric. An accelerated bachelor’s of science in high-tech manufacturing, initially only open to GE employees who will do their training at a GE jet-engine manufacturing plant. University of Texas Austin and MakerSquare. A 13-week computer-programming course to prepare students for mid-level software engineer jobs. The programs target lower income and nontraditional students who are either older, go to school part-time or want to update their skills mid-career. “In too many cases, low-income students have been unable to get the training they need because they don’t have access to financial aid to pay for them," Under Secretary of Education Ted Mitchell said in a press briefing. The ability of people to get jobs after doing the training is critical, he added. “It’s not enough to measure access and enrollment. We need a laser focus on outcomes.” In the next decade, 11 of the 15 fastest growing occupations will require some kind of post-high school education. New Model of Education Welcome but Not a Cure All Consumer advocates applauded the move. “It's no secret that there are skilled jobs in the U.S. that employers are having a hard time filling—and that online education and training has a role to play more broadly in expanding access to learning opportunities,” said Suzanne Martindale, a staff lawyer at Consumers Union, the policy and mobilization arm of Consumer Reports, who focuses on higher education issues. The financial aid program comes as a growing number of people question the cost of higher education. Today a four-year education at a state school—including tuition, fees, and room and board—costs an average of $78,000; at a private university, it’s more than double that. More than 70 percent of graduates leave school with debt. And it's wreaking financial havoc on their lives. A Consumer Reports nationally representative survey (PDF) of more than 1,500 student loan borrowers found that 44 percent of those who've left college say they have had to cut back on daily living expenses, and 28 percent have had to delay major goals like buying a house, and 37 percent put off saving for retirement. The financial impact is so daunting that 45 percent of borrowers say knowing what they know now, their college experience was not worth the cost. The EQUIP programs aren’t a cure-all, said Martindale. “They won't be the right fit for everyone—not everyone is going to be a software engineer,” she said. It's important that these programs remain affordable, "especially if they recruit from low-income communities, so that if a program doesn't work out for the student she isn't stuck with a ton of debt at the end," she said. The financial aid programs will start rolling out early next year. The institutions are in the process of setting them up and getting final approval from the Department of Education. Mitchell estimates about 1,500 students will enroll in the first year.

7 degrees, no student loans, and 5 years of savings BY KATHLEEN ELKINS WITH BUSINESS INSIDER Justin Hall and Tina Hanisch, both 29, invested a lot of time in their education. Hall received a bachelor's degree, two associate's degrees, and a master's degree, while Tina earned two bachelor's, an associate's, and is slated to complete her master's in two years, which will up their degree count to eight. Their education came with a hefty price tag of $206,000. They whittled that sum down to $68,000, and paid it without taking out any student loans. What's more, through diligent saving and creative strategies, Hall and Hanisch—who are not married—have saved enough money that they could choose not to work for the next five years. Their impressive savings were an indirect result of living below their means and keeping expenses at a minimum. "Neither of us can sit still, so not working is out of the question," Hall, who works in financial services, tells Business Insider. Hanisch is a registered nurse and works when she's not taking classes or studying. "Being financially responsible is more about the opportunities versus not having to work. We want the ability to take more risk, to try new things, and to experience life in ways you normally couldn't." Here's how they covered $206,000 worth of education and set themselves up for several years of financial independence. 1. They Took Advantage of Company Programs and Scholarships to Cover Tuition. While their education amounted to $206,000 total, they only had to cover $68,000 out-of-pocket. The remaining $138,000 was paid for in scholarships ($65,000) and through company programs offered by their employers ($73,000). "There is so much money available to students who take a proactive approach to finding it," Hanisch tells Business Insider. "Being proactive was one of the key factors to my success. Every night I religiously sifted through online scholarship websites and local college funding programs for opportunities. I also stayed in constant communication with my [undergrad] school adviser, as they have up-to-date information about new or upcoming scholarships that you can apply for." 2. They Made Smart Investments. One of Hall's smartest investments was a home he purchased in 2008 with three partners. They proceeded to flip it later that year and earn a profit. At the time, he was completing his associate's degree from Mesa Community College. While a risky investment, he had the funds to invest in flipping the house because he was working two jobs while in school. "You always have a little fear in the back of your mind about potential risks," he tells us. "But in reality that fear is actually a tool that keeps you on your toes; it helps you stay on budget during renovations and it helps you overcome problems." Another major investment vehicle for Hall is the stock market. "I usually focus on five to 10 stocks for long-term investing. Since I do not trade for a living, I try to manage a smaller portfolio," he explains. "One of the benefits of being young is that you are able take more educated risks and still have time to secure your financial future if you fail," he says. 3. They Didn't Drain Their Savings to Buy a House. In 2011, Hall and Hanisch opted out of buying a new home together, and purchased a $60,000 fixer-upper in Mesa, Arizona instead. They've since put in $20,000 of renovations and completely remodeled the home without hiring a contractor and relying on help from family instead. They estimate they could sell it today for more than double the amount of money they put into it—for roughly a 125% return on their investment, Hall says. They were strategic when it came to buying their home. They bought it at a good time, when prices were still fairly low following the market crash of 2008, and they paid all cash. Not having a mortgage and interest payments provided emotional and financial freedom, Hall says. They were able to spend money on significant renovations to make the home their own, and never felt financially stressed about making payments. 4. They Created a Joint Account and Maximized Credit Card Rewards. Right before buying their fixer-upper, the couple created a shared account and opened a credit card to split joint costs like utilities, food, and other necessities. "All costs are run through our credit card, which gives us 1.5% cash back, so we basically get paid to pay our bills," Hall tells us. One month, he explains, they had to pay several thousand dollars on home and car repairs, but it resulted in about $550 cash back, which they will either put back into their joint account or use towards a vacation. While they set up a joint account for certain costs, Hall and Hanisch also maintained their own accounts, which has allowed them freedom to spend their own money as they please and prevented financial disagreements. They each put 10% of their earnings into the joint account, 10% into their 401(k)s, and 5% towards charitable donations. Hanisch allocates 30% of her earnings for personal expenses and 45% for savings, while Hall puts 20% of his monthly earnings towards personal expenses, 40% towards investments, and 15% towards savings. 5. They Made Sacrifices In Order to Live Below their Means. "Tina and I both lived below our means throughout school," Hall tells us. "There were times when we did not go on vacation, nor go out with friends or family. Instead we worked, studied, and saved. We really took the concept of 'live a few years of your life like most people won't so you can live the rest of your life like most people can't' to heart." Some of the bigger sacrifices included working throughout college and post-grad programs, and living with family until buying their fixer-upper. They're reaping the benefits today, and have exciting opportunities on the horizon. "We have an opportunity now where we can decide where we want to go," Hall explains. It will likely be California, where Hanisch could finish her master's online, but they're still deciding. "And I want to start my own business," Hall says. "With this financial freedom, I’m choosing to go that route." "We're going to take more risk now, step outside of our comfort zone, and travel more," he continues. "We're going to try to experience things differently. Instead of just saving, we're going to invest, experience life, and enjoy it now that we've put in the hard work."