Would you recommend I live on campus next year?

Paying for College
1

I have two scholarships that are worth $30,000 each and I have Florida Prepaid that already paid my tuition, most fees, and first year housing. The college I am starting at this fall is 40 minutes away from my house. If I live at home for the next three years of college I can pocket $50,000 that I would otherwise be spending on housing and the meal plan/food. I know I have all of this school year to decide, but would you recommend living on campus or at home?

During college I plan on working $8.25 at 10 hours a week, and I have an internship lined up for the summer that pays $12 an hour and is 9-5. Using rough estimates, if I live on campus, after paying everything (including food, going out money, and things like gas and toiletries) I’ll have about $19,000 after college. If I don’t live on campus I can have about $50,000 more after college, about $69,000.

I haven’t moved out yet, but I am very much looking forward to the independence of living on my own, and the whole “college experience”. However, it’s hard to justify giving up this huge financial opportunity.

2

Are you absolutely sure your scholarships will be awarded for monies in excess of the cost of attendance? Check that.

It sounds like you have the financial resources to live on campus and still have some extra money. I would suggest living on campus if that is the case…AND your parents are on board with you residing on the college campus.

This really is a decision you and your family need to make.

3

Remember to include the taxable scholarship amount on your income tax return. See IRS Publication 970.

4

I think you should live on campus your first year and decide it if is worth it to you. The dorms are not that expensive and UF is unique in that you don’t have to buy a meal plan so you can control how much you spend.

5

Live on campus your first year.
Research shows that students who don’t have to commute or live on their own but live in campus dorms are more involved, have a better college experience w and get better grades.
You can clearly afford it, so I don’t see a downside.
(Also, often, money for Education can’t be used for non Education purposes.)
Dinalky, a 40*2 commute will cut you from study groups, evening activities, clubs, socialization, not to mention review sessions and films (in my experience those were scheduled after 7pm).

6

As the others have said, check out the details on your scholarships, almost all only pay for college “cost”. Some will only pay the university directly. Check those details.

You really should stay your first year on campus. For all the reasons MYOS1634 lays out, plus this is the time where you start making friends and finding your “tribe”. Study groups are important, especially later on. A lot of group studying, social activities, clubs, design teams, etc., all take place in the evenings.

Think of college as being an investment in your future. Living on campus that first year is part of that investment. If you can afford it, it’s a great option.

7

College is about more than academics. Learning to mature by gaining independence, being responsible for all aspects of life (food, laundry, banking, medical stuff, sleep, exercise) is a great path to adulthood. Making and keeping friends and study partners, exploring new activities around campus and in the area–these things can happen as a commuter, but could take a lot more effort.

Living in a dorm pushes you out of your familiar surroundings. It is part exciting, part nervewracking, and part adventurous. You will encounter other students with different backgrounds, and you might figure out that your childhood experiences and the way you behave are not the only/right way. Accepting differences in others is a healthy thing.

After a year of living on campus, you can reflect on your situation and make a decision for future dorm vs commuter life.

8

Congratulations on your achievement. As everyone has suggested, stay on campus. it is a critical part of the college experience.

Looking back at our experience, my wife and I (would not have met her if I didn’t live on campus - two doors down in my dorm) frequently reminisce how great college was. Yes we enjoyed the academics, but we’re really referring to the friends and activities. Basic things like hanging out in someone’s room to 2 am just listening to music and laughing a lot. Playing intramural sports for the dorm team. Going to the dining hall with a group of friends (really was one of my favorite parts of the day) every day for dinner.

We are very close with several of these “kids” even though we live in different parts of the country. That is a big part of the “college experience”. Otherwise, it’s just taking a bunch of classes. You can do that anywhere.

9

Just read an article by a physics Prof who explained the lectures’ content are the chocolate chips of college. The college experience is chocolate chip cookies - includes the chocolate chips but are so much more :wink:

10

@MYOS1634 I always enjoy a cookie based metaphor. Do you happen to have a link to the article?

OP - I have nothing to add except to agree with the others. In particular, it would be very unusual if you were actually able to pocket $50,000 in excess scholarships.

11

^ Look up " you can learn everything online except for the things you can" + wired.
:slight_smile:

12

Well, his Florida Prepaid is a 529, so he has the choice to use it or bank it. That money is his/family’s to do with as they want. Assume one of the $30k scholarships is Bright Futures which is refundable to the student at UF. That leaves the other $30k which could actually be applied to the costs. It may be that if the student doesn’t live on campus that some of that is not refundable to the student. It may be that the r&b is only awarded if the student actually lives on campus.

OP, you say that the FPP has already paid your tuition? That’s unfortunate as that money could have remained ‘banked’ or withdrawn without penalty as a 529. You want to carefully plan which scholarships to use for tuition for the best tax benefits and refunds.

13

The Florida Prepaid is being used to pay tuition because taking the money out would only get us $8,000 as that was what we put into it.

The two scholarships that we are cashing in are Bright Futures and the UCF Provost Scholarship, both of which I’m sure I will be able to pocket. However twoinanddone makes a good point that I haven’t considered taxes on the scholarships, but I do know that I can use the money on anything.

I’m already living on campus for my first year because Florida Prepaid already paid for it, and we paid prices from around 2003, so there’s not much point in taking it out. Plus I do want to have the experience of at least the first year.

After the first year I have to decide if I want to continue living on campus for the next three years, or to move back home.

If I decide to live on campus all four years plus all summers, I will have roughly $19,000 after college. This is after paying for all fees (including estimated class fees), food, $20 a week in spending money, parking, gas money, and reoccurring costs such as toiletries and haircuts. I overestimated on all of these costs to leave extra space. I also estimated the money for the jobs I will have, as I already know what they are, how much they pay, and how many hours I’ll work per week, and what weeks I’ll be working.

If I go the complete opposite end of the spectrum and stay at home after my freshman year for all of college, using the same estimates, I’ll have $69,000 after all costs because I can pocket the scholarship money. It might be less though because I couldn’t figure out whether Bright Futures and the UCF Provost Scholarships are taxed. If anyone knows this would be very helpful.

In reality, I’ll probably end up doing something in the middle. I just was wondering what others might do in this situation. While I do like the idea of living on campus on my own, if I live at home during the summers or for one school year, I can save money from housing and food.

14

Ok, so I just looked at IRS publication 970.

It says that a scholarship is not taxed if it does not exceed the cost of attendance. Each individual scholarship does not exceed the cost of attendance, but the sum of them does. Does this mean the scholarships are taxed or not taxed?

15

Did you enjoy your time on campus? If not, was it the dorm living arrangement or something else? You can always move off campus to an apartment and still have the full experience. If you move home and commute, you will be missing out on a tremendous personal growth opportunity.

I’m assuming there was an issue your first yr or you likely wouldn’t be asking this question.

16

Any portion of a scholarship not used for Qualified Expenses, which are basically tuition, fees, books, is taxable. If you use the FPP for tuition and room and board, it is not taxed because it is not a scholarship or grant, it is a 529, but then the BF given to you will be taxed as it is not used for QEE. You’ll have to check to see if you’ll get the UCF scholarship given back to you in cash if not needed for tuition or on campus room and board. It is up to the school if they’ll allow you to keep that too. If so, it will be taxed.

It is still a wonderful deal to have a refund of BF and any other scholarship as you won’t be paying at 100% rate - you get to keep some money, you just don’t get to keep it all.

17

It’s the sum…not each individual number.

@BelknapPoint …isn’t it qualified educational expenses…not “cost of attendance”?

Any scholarships you receive in excess of qualified educational expenses are viewed as taxable income. You need to also be very aware of the rate at which you will be taxes…the kiddie tax is sometimes a shocker to folks.

So…all that “extra money” you are pocketing each year…plus any amount used for room and board will be considered income for you, the student. So…make sure you save enough to pay your federal income taxes.

18

His room and board is being paid with Florida Prepaid, which is like a 529, so not taxed when used for QEE or room and board. The BF and UCF scholarships will be taxed yearly, not as a $30k lump sum at the end. If he uses any of the BF or UCF money to pay for room and board in years 2-4, it would be taxed.

19

My advice for you is to track every penny you are spending that counts as a “qualified educational expense” including computer and books. When it comes time to do your taxes, the school will provide you with a document that probably isn’t correct, and you’ll need your own paperwork to do your taxes.

You will be taxed on any scholarship monies you have received that are in excess of the QEE. That includes, unfortunately, room & board. My DD is on a full ride scholarship that even covers her travel expenses to/from school, so I familiar with this process. Software can help you with the process. There are going to be changes for taxes that make the future process a little uncertain, as the new tax code hasn’t been published yet and some details are unknown. Based on the old tax rules, you would have had to report the amount as unearned income. As such, it is taxed at the parents’ tax rate (aka kiddie tax). I was surprised by how much it ended up being, but, it was far better than paying for everything out of pocket!

20

I agree that he should track every penny. He’s using the Florida pre-paid to pay his room (I don’t think it covers board) and that is not taxed as it is treated as a 529 for tax purposes. If he does have a meal plan, and if it is paid with UCF grant or BF, it will be subject to tax.