Future college students who are trying to figure out how much student debt to take on or wondering how they will handle student loan balances after graduation may want to consider colleges and universities that offer formal cooperative education programs.
Co-op programs combine academic studies with paid work experience in a field related to a student’s major or career goals. They are supported by an agreement between students, employers and the college or university to provide students the opportunity to work in positions that provide extensive experience in their chosen field.
Along with real-world experience, the wages received during the co-op can be a significant part of the college funding mix for students, possibly letting them reduce student loans.
[See: 11 Steps to Minimize Student Loan Debt.]
Co-op education can potentially offset the amount of debt a student might take on to pay for tuition and other expenses in a number of ways:
— Access to competitive wages.
— Availability of funds throughout a student’s education.
— Potentially shorter length of time in college.
— Increased employability and earning power.
Access to Competitive Wages
Co-op students are compensated more competitively compared with student internships, which are more likely to be unpaid. Students involved with a co-op have earned more than $40,000 during their college career at some schools. When applied to tuition, that’s a big step toward graduating with reduced debt.
[Read: Understand the Differences Between a Co-op, Internship.]
Students in science, technology, engineering and math — commonly known as STEM fields — or other in-demand careers might enjoy even higher wages. The businesses taking part in co-op programs realize the value of hiring STEM co-op students and often offer competitive market-rate wages. Some co-op students in STEM fields have even enjoyed a bidding war between potential co-op employers when it comes to compensation.
In some cases, co-op students receive not only competitive wages, but also stipends for travel and housing assistance, which can also reduce dependence on student loans.
Availability of Funds Throughout a Student’s Education
Co-op programs allow students to alternate between working and studies throughout their education. Depending on the college or university, wages from co-op jobs could be available throughout a student’s college career, which helps with overall budgeting.
When looking at balancing student loan debt with co-op wages, be sure to understand the institution’s formal co-op program timing requirements. Co-ops can be offered in a variety of arrangements: parallel, which is part-time work and part-time study; extended day, which is full-time study and part-time work or full-time work and part-time study; and alternating, which is a quarter, semester or year of full-time work that alternates with a session of full-time study.
Potentially Shorter Length of Time in College
It’s a commonly held belief that co-op programs delay the completion of a bachelor’s degree. Yet it pays to look deeper. It now takes many undergraduate students not in a co-op program more than five years to complete their bachelor’s degree program.
Depending on how a co-op program arranges professional work positions and coursework, students can still earn their baccalaureate degree in less than five years. In fact, some schools with robust co-op programs say that students who participate in co-ops actually finish their bachelor’s degree in less time than average, which can result in the need to take on less debt.
[READ: How the Work-Study Program Can Cut Student Loan Borrowing.]
Increased Employability and Earning Power
Today’s graduates need to have employable skills right from the first day of work, and a co-op placement is the perfect opportunity to acquire skills that make graduates more competitive.
Co-op grads stand out from the crowd when applying for jobs, since employers value candidates with relevant work experience over those who graduate with a random job history or just academic credentials. Co-op grads show up as well-rounded applicants with up-to-date experience in their respective field, bringing solid interview and job search experiences as well as professional references from their network. This edge gives them more confidence when applying and interviewing for jobs.
Even better, some data indicates that students who graduate with co-op experience tend to start jobs at a higher salary because they enter the workforce with more experience.
While each person’s situation is unique, choosing a college with a co-op program can be a winning combination when it comes to funding higher education.
It’s no surprise the number of U.S. colleges offering cooperative education has grown. The advantages add up, making it easier for co-op grads to manage student loan repayment upon graduation and through the life of their debt.
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Ways Cooperative Education Can Reduce Student Loan Borrowing originally appeared on usnews.com
