Many families are forced to get creative to pay the staggering cost of college. About 3 percent of parents and 3 percent of students now use a credit card to cover some of the tuition bill, according to Sallie Mae.
"Convenience fees" make that a bad idea for many people.
“It doesn’t make sense to pay your tuition with a credit card, if you’re charged a convenience fee,” said Matt Schulz, a senior analyst at CreditCards.com. A new survey of the 100 largest public, private and community colleges by the website shows the average convenience fee for paying tuition with a credit card is 2.62 percent. That would be a $262 fee for every $10,000 charged. The highest fee was 2.99 percent. “Even if you avoid interest by paying the bill promptly, the convenience fees outweigh the potential benefits of almost all credit card rewards programs,” Schulz said.
CreditCards.com found that 87 percent of the 300 colleges and universities surveyed accept credit cards for tuition payments for some students. Of those, 12 percent of community colleges charge a convenience fee. That climbs to 90 percent of public universities and 69 percent of the private institutions that accept credit card payments.
Herb Weisbaum is The ConsumerMan. Follow him on Facebook and Twitter or visit The ConsumerMan website.