Is it a bad idea to put tuition on a credit card?

[AmbitiousSaver]

Or better to just not go at all this summer?

I am registered for 1 summer course (master's course)... I'm 9 classes away from finishing the degree and I'm going to a public, in state university. The cost of the course is $1000 + $200 for books and a summer parking pass.

Between unexpected vet bills, and repairs on our rental, and emptying my savings account to pay down the credit card - I know, bad planning - I've realized I'm just not going to have enough to cover the $1200 tuition & books.

Normally I'd just not go... BUT these courses are only offered once a year and the site they are offered at varies. This summer they are offered just up the road from me, next year the tuition will go up and it will be 30 minutes away adding to a commute & gas costs.

I have a low interest rate credit card I could use (7.9% purchase rate, another one is at 0% if I do a balance transfer with a 3% transfer fee)... is this a bad idea? I'm feeling pretty mixed about it so was just wondering if anyone could offer an objective opinion. Cause the other thing I have to weigh is that we may leave here in Jan 2010 or 2011 so no matter what I need to be finished by then.

I've considered student loans but forgot to fill out the FAFSA this year cause I had my baby in late January so my mind was side-tracked.

I also want to add that in order to do anything in my field I've been told there is a glass ceiling unless you have a certification, and in order to get a certification you need 150 credit hours = master's degree. So this is why I feel mixed on this - I could easily just not go but worry if I don't that something bad may happen down the road and I'll wish I had gotten my degree when I had the chance.

[LivingAlmostLarge]

So the EF is completely used up? Trust me I'm getting to that point as well for tuition. We've paid $12k thus far in less than 30 days, and owe another $3k by 6/30 (being paid that day).

It's going on our credit card for float because we're getting the $3k on July 1st ESPP. I decided to irrationally max out our Roth IRAs asap and so money is a bit tight.

So how long until you can pay back the $1200? Do you have other debts like car loans, etc? Can you safely pay it back in 3 months? Are you coming into money soon?

Also I won't say borrow from a friend/family because I would never do it. I'd take out a loan first.

[AmbitiousSaver]

We do have quite a bit of debt too. Problem is, I never really had an EF cause any money I accumulated in savings, I just paid down the CC cause I was afraid I'd spend the savings. In May I paid $3100 down on my CC ($630 over what I planned).

So I got the CC below $10K finally... BUT I don't have enough now to pay my tuition. Definitely bad planning on my part.

I don't want to put it on the same credit card since its at 3.65% fixed and the purchase rate for that CC is 7%... and I know once I do that then the CC company will start applying the payments to the lower interest rate amount and leave the higher interest rate balance.

I do plan to pay for my Fall class in cash. And DH is supposed to be getting some extra travel pay back from his business trip... he's estimating about $700 so the $1200 could be paid back sooner than we think, but nothing is "set in stone" either.

I guess that should be my first step in evaluating this... looking at a repayment schedule and seeing if thats doable. Thanks for pointing me in that direction... I guess I got so blindsighted on the "in order to do this we have to put it on a CC" - I didn't sit down to think about that next step.

[disneysteve]

As I said on your blog, I think this is one of those times where not using the CC may be short-sighted. This isn't a new handbag or concert tickets or a trip to the beach. This is your education and professional future we're talking about. In the grand scheme of things, $1,200 is nothing. If the only way to take this class is to charge it, I'd say to go ahead and hand over the card.

In May alone, you paid $3,100 toward the CC. I don't think $1,200 will pose a major problem for you.

ETA: Had you filed your FAFSA, you would be borrowing this money as a student loan. All that changes here is who the lender is. The amount borrowed is the same. Take the money and study hard.

[LivingAlmostLarge]

I agree about taking the class. However, I might consider putting it on another credit card. I'd love to have invested our tuition intsead of sitting on it in cash for 3-6 months at a time. BUT it's too risky. So I have to set things aside.

I think it sounds doable that you could charge $1200 and pay it off by the end of summer. But consider a second CC.

[MiikeB]

As I said on your blog, I think this is one of those times where not using the CC may be short-sighted. This isn't a new handbag or concert tickets or a trip to the beach. This is your education and professional future we're talking about. In the grand scheme of things, $1,200 is nothing. If the only way to take this class is to charge it, I'd say to go ahead and hand over the card.

In May alone, you paid $3,100 toward the CC. I don't think $1,200 will pose a major problem for you.

ETA: Had you filed your FAFSA, you would be borrowing this money as a student loan. All that changes here is who the lender is. The amount borrowed is the same. Take the money and study hard.

I agree with Steve. Especially because the 7.9% probably isn't much different from the rate you would get as a student loan.

[moneybags]

I charged my last semester of college. I knew my earning potential would be increased upon graduation, so I went ahead and finished up. No regrets.

[stressedmama]

Your situation would be one of the very few where I would say charge it. If you can swing getting an advanced degree now and up your earning potential, do it. In the meantime think of every way possible to pay off the credit card ASAP.

[Joan.of.the.Arch]

Are you currently working in that profession?
Are the certifications the same from one state to another? I ask because I gather from your other posts that you may well move elsewhere in the foreseeable future.

[AmbitiousSaver]

Thanks for all the insight. I'm thinking I'll probably go ahead and take the class and just set up a plan so that I can get the CC paid off ASAP.

JoanofArch, right now I work as a business analyst... although my actual "duties" varies widely. I'm in the process of evaluating our accounts payable process to see what improvements we can make but also handle a lot of reporting for the department . My bachelor's degree is in accounting and my ultimate goal is to earn a CMA (Certified Management Accountant) certification... but in order to do that I need 150 credit hours which a master's degree would give me.

The job is actually based in LA, but its an online company so I work from home and can take this job anywhere. I live on the East Coast now but when I was hired I lived on the West Coast. Pays well and offers benefits, have been with them for four years and I don't think my job is in any jeapordy BUT heaven forbid I lose my job, I'd need to be making 60-80K in order to keep our same lifestyle AND pay childcare. With my bachelor's degree I can't negotiate that... with a master's I probably could.

I'm not sure how transferrable the certifications are from state to state... but most states require 150 credit hours. And I believe it would likely be like the CPA certification where you would have to apply for reciprocity with the state. I hadn't looked too in-depth with that since all I knew was that in general almost across the board for accounting certifications you need 150 credit hours first and then take the exams

[ScrimpAndSave]

I've done this many times and now I am sitting here as a 4th year teachers with my Masters in Educational Administration with a Principal's Certificate..

It's all paid off and it was SO worth it.


Good luck!

[SnoopyCool]

I think education is worthy cause for debt. Not for everyone, not always, but in this case, I say definitely.