Best State to Attend College For Low Post-Graduation Debt: New Mexico

New-Mexico-College

High school seniors are busy applying to colleges. Some of them want to stay close to home. And still others see college as a great opportunity to get away from home. There’s a lot to be said for putting some distance between yourself and your high school friends and family. Going away to college gives you the chance to escape your local reputation and reinvent yourself. It gives you the chance to be more autonomous, less dependent on your parents. Going to college out of state may give you a better chance to figure out who you really are without parents hovering over your shoulder, second guessing your every move.

Students who go to college in New Mexico graduate with the lowest college debt in the United States. New Mexico college grads have, on average, an $18,656 debt for a four-year degree, according to the Project On Student Debt published by the Institute for College Access and Success. That may seem steep, but not when you compare it to the average debt of graduates from colleges in New Hampshire. New Hampshire graduates find themselves saddled with a whopping $32,795 average debt. Only 54% of New Mexico’s college grads actually have debt. While New Mexico schools do not enjoy the reputation of Harvard or Yale or other ivy league schools, they do offer the opportunity to get a four-year degree without incurring high debt payments after graduation.

Many college students acquire debt blithely because it does not seem real to them. However, when you get your first job, earning, say $28,000 a year, your debt will be very real. After taxes and insurance, your take home pay is likely to be around $450 a week. If you took out only federal loans, you qualify for the “pay as you earn” program which caps what you have to pay on a sliding scale. If you are eligible for that program, payment on your college loan is capped at $28 a week or around $122 a month. While that is still a modest sum, for a recent graduate who has to pay rent on his own apartment and car payments, it can be something of a hardship. It can mean having to buy a much older car than you wanted. Or it can mean the difference between being able to go out to a club with friends and having to stay at home because you’re broke. And there’s further bad news: When you get a raise, your loan payment will go up in proportion to your new earnings. Using the pay as you earn program also means that it could take many, many years to pay off your debt.

If you are lucky enough to already live in New Mexico, there are many good state schools that offer very low in-state tuition, but these excellent rates are for legal residents of the state. Out of state tuition fees can raise the cost of an education by one hundred percent or more. You can get around out-of-state tuition by moving to New Mexico, sharing an apartment and working for a year to establish legal residency, and then applying to one of the state universities. Most single high school graduates living independently of their parents qualify for Pell grants which cover a significant portion of college costs. This is a great strategy for would-be college students who cannot count on a lot of support from their parents.

According to the Project on Student Debt, the cheapest New Mexico state university is Navajo Technical College where tuition and fees for a four-year degree are a modest $13,040. Sixty-four percent of Navajo Technical College students are on the Pell grant which covers not only their tuition, but also a good part of their housing costs. The more prestigious University of New Mexico-main campus costs $19,074 for four years of in-state tuition and fees ending in 2013. It’s worth noting that the Pell grant which funds $5,730 of eligible students’ college costs annually covers that cost entirely.

Be a safe driver, not a statistic

In 2012, 1.8 out of 100,000 New Mexico drivers under the age of 21 were killed in alcohol-related car wrecks, according to the United States Census. It’s not the highest fatality rate in the nation, but not the lowest either. To put that statistic into context, in much more densely populated New Jersey, the number of under-21 alcohol-induced traffic fatalities was a mere .08 out of 100,000. Such accidents are, strangely, much more common, however, in Montana where the rate is 3.8 out of 100,000. Young men are at a much higher risk of dying behind the wheel of a car than young women, because men are statistically more likely to drink and drive. They’re also (statistically) more likely to go flying through the windshield because they neglected to wear their seatbelts. If you are a young man and you’re starting to feel insulted, let me hasten to point out that these are just statistics. If you don’t drink and drive and you make wearing a seatbelt part of your religion, you won’t be a statistic. At least not that statistic.

The moral here? Don’t let the beautiful wide open spaces in New Mexico lull you into forgetting the essential danger of driving a vehicle that is careening through space at a rate of 60 miles per hour. Stay sober, and keep your eyes on the road and your hands on the wheel of the car. If at all possible, leave your cell phone in your dorm room or apartment when you are driving short distances to eliminate the temptation to send a quick text. If you can simply avoid driving under the influence of alcohol AND your cell phone, your chances of surviving to graduation in any state are excellent.

Car insurance for New Mexico college students

When you’re calculating the costs of going to college, you must consider the cost of insuring your car. New Mexico ranks right about in the middle for car insurance costs. It is neither one of the highest priced states, nor the lowest, according to a 2010 study issued by AAA.

The bottom line here: the cheapest way to get by in college is not to have a car. Period. Many, many students get through four years of college, happily, without a car. If you live in a dorm or an apartment within a mile of your school, you really don’t need a car. And the freedom of not having to pay for insurance, registration, and repairs can be wonderfully liberating. You can catch a ride with friends when you want to go to a movie or restaurant off campus or take your spring break in Daytona. Going carless in college may help you stay on task, keep going to classes, and avoid the distractions that help many students flunk out.

If you MUST have a car, the best way to insure it is to bundle your car insurance with your parents’ insurance–even if you have to pay your share of the premium. To make this work, one or more of your parents must be the legal owner of your car. If you bought your own car in high school, the smartest thing you can do is to swallow your pride and deed the vehicle over to your mom or dad. Then you can be a dependent on their insurance which will cost much, much less than if you go it on your own. If you go this route, you must take care to maintain some degree of dependence on your parents. In general, this means they help you financially–even if it’s only a few hundred dollars a year and you spend at least one college break–summer, winter, or spring–with them per year. The good news is that, so long as you maintain this nominal dependency, you can stay on your parents’ insurance indefinitely, no matter how old you are. That means you can graduate, go to medical school, and then do your hospital internship while still on your parents’ car insurance. You will save a tremendous amount of money, even if you have to split the bill with your folks.

One of the many reasons for being a car free college student is that auto insurance rates for people under 25 are severely high. They are even higher for men under 25, according to the United States Department of Motor Vehicles.

Driving a car when you’re under 25 is a strange game, and your only winning move is not to play. Many New Mexico universities are in semi-urban areas which means that there are numerous entertainment opportunities nearby. For instance, within a half mile of the University of New Mexico campus, you have a pizzeria, a taqueria, a hookah bar, and several pubs and bars. Why would you need a car when there are so many places to grab a bite and relax within easy walking distance? Be brave. Leave car ownership for later.