The question of whether to live on campus during college is an important one due to the amount of money the decision involves. Schools can charge thousands of dollars for room and board and students can sometimes pay less to live off campus and commute. That said, there are some clear financial pros and cons to living on campus, however, and knowing what they are can make it easier to decide where to live.

On Campus Vs. Off Campus Living
When deciding whether to live on campus, funding from scholarships and student loans are key. Many scholarships and loans can be applied to on-campus housing because the money is directed straight to the school; in many cases, students may not be able to use it to pay off-campus rent.

Further, students with 529 plans or other college savings plans may find that plan rules limit them to living on campus. In general, there is a limit to the amount of money you can deploy from the 529 plan to pay for off-campus housing before it becomes subject to taxes. Depending on the plan in question, a student may have enough money to live off campus comfortably, but not be able to actually use the money for that purpose without incurring significant penalties. (Learn how to put your kids through school without being hounded by the tax man in Clearing Up Tax Confusion For College Savings Accounts.)

The Pros of Living on Campus
While off-campus rents may be cheaper than the price of room and board at school, rent rarely provides the range of services that a school offers. Living in a dorm eliminates electricity, gas and water bills, and sometimes even cable and internet bills. At most schools, the price students pay also covers food - three hot meals a day. Also, unlike apartments, dorms don't require a security deposit.

Another cost that living on campus eliminates is buying furniture. Every dorm room comes with at least a bed and a desk. Most residence halls also offer common areas with couches, televisions and other comforts of home.

The potential cost of having a roommate also decreases when a student lives on campus. If a student leaves mid-semester, his or her roommate doesn't need to worry about covering the full cost of rent or utilities. Schools also handle a certain amount of roommate matching, eliminating the hassle of advertising for roommates and covering full costs until you find one who is suitable.

One benefit of living on campus can be especially financially significant: the cost of a car. Even for students living on campus with cars, gas bills are minimized because they don't need to drive to school every day - they're already there. If a student chooses to do without a car entirely, most colleges and universities are perfect for pedestrian transportation. Students who live within walking distance of their classes also don't have to pay for pricey campus parking permits. (For related reading, see The True Cost Of Owning A Car.)

The Cons of Living on Campus
Many schools promote their room and board offerings as cheaper than living off campus. The truth of those claims varies depending on the area in which the college or university is located. But even in expensive areas, thrifty students may be able to live off campus for less. (Learn more in Are You Ready to Rent? and Easy Ways To Cut Rental Costs.)

Meal plans are an obvious area of inflation: few students eat as often as their meal plans provide for. Also, many cafeterias offer only limited options for healthy eating and special-needs diets, which for some students, could mean regular trips to the grocery store despite the meal plan.

Another drawback to living on campus is that students who live on campus can face larger penalties than their off-campus counterparts. If, for instance, a student must withdraw from school part-way through the semester, he or she could face significant penalties for breaking the housing contract. Even if the student plans to come back the next semester, he or she will need to move out of campus housing immediately. Furthermore, students can face a whole list of fees for infractions like noise complaints that are fairly minor issues when living off campus.

While some schools provide less expensive housing than a student might find on his or her own, students from the area surrounding a college or university often have an option for free room and board if they can live at home, or with family or friends.

Where to Drop Your Head and Books
You may not have a choice in the matter if you attend a school that has a residency requirement. The University of Louisiana, for instance, requires that freshmen live on campus unless they live with their parents or otherwise receive special permission. That said, most schools provide special exceptions for married students.

In contrast, there are also a number of schools that make the decision to live off campus for their students. Not all schools offer an on-campus option for students through all four years of their studies.

The decision to live on campus during college is often described in terms of social networking, student retention and scholastic achievement. But while parents do want to give their children the best education possible, finances can play a large role in the decision. Because each school has varying costs for room and board, the decision can be different for individual students - so be sure to carefully research the particulars of the schools you are considering in making this decision.

For related reading, see Five Ways To Fund Your College Education and Pay For College Without Selling A Kidney.

Related Articles
  1. Professionals

    Is A Stockbroker Career For You?

    Becoming a stockbroker requires a broad skill set and the willingness to put in long hours. But the rewards can be enormous.
  2. Investing Basics

    How to Become A Self-Taught Financial Expert

    Becoming a self-taught financial expert may not be as daunting of a task as it seems.
  3. Personal Finance

    University Donations: Which Schools Got the Most

    A closer look at the staggering $40.3 billion donated to colleges and universities in 2015.
  4. Credit & Loans

    Student Loan Refinancing: The Pros and Cons

    To refinance your student loan or not? Here are the top pros and cons to consider.
  5. Investing

    Job or Internship?: A Guide for College Students

    College students, which is better for your future - an entry-level job or a unpaid internship? Find out now.
  6. Savings

    The Top 12 Weirdest Scholarships Available

    Cut your college expenses drastically by winning one of these off-the-wall scholarships.
  7. Budgeting

    3 Alternative Ways To Save for College

    The cost of college is skyrocketing at a time of record student loan debt. But there are ways to earn a college degree without traditional borrowing.
  8. Savings

    529 Plan Contribution Limits in 2016

    Learn about the contribution and account balance limits on 529 plan accounts and discover how these contribution limits differ in each state.
  9. Professionals

    4 Degrees Most Oil Companies Are Looking For

    Find out which four degrees oil companies want to see on the resumes of new hires, and find out why the industry still pursues these graduates.
  10. Professionals

    8 College Degrees with the Best Returns on Investment

    Find out which college degrees offer the best opportunities to earn a salary that can generate a solid return on your investment in education.
  1. What's the difference between microeconomics and macroeconomics?

    Microeconomics is generally the study of individuals and business decisions, macroeconomics looks at higher up country and ... Read Full Answer >>
  2. Can I get renters insurance without a lease?

    Renters insurance does not require the policy owner to have a lease. For example, many college students acquire renters insurance ... Read Full Answer >>
  3. What’s the difference between the two federal student loan programs (FFEL and Direct)?

    The short answer is that one loan program still exists (Federal Direct Loans) and one was ended by the Health Care and Education ... Read Full Answer >>
  4. Why might landlords require renters insurance?

    Landlords can require renters insurance to lower their own liability and insurance costs. According to data from the Insurance ... Read Full Answer >>
  5. Student loans, federal and private: what's the difference?

    The cost of a college education now rivals many home prices, making student loans a huge debt that many young people face ... Read Full Answer >>
  6. Can I use my IRA to pay for my college loans?

    If you are older than 59.5 and have been contributing to your IRA for more than five years, you may withdraw funds to pay ... Read Full Answer >>
Hot Definitions
  1. Harry Potter Stock Index

    A collection of stocks from companies related to the "Harry Potter" series franchise. Created by StockPickr, this index seeks ...
  2. Liquidation Margin

    Liquidation margin refers to the value of all of the equity positions in a margin account. If an investor or trader holds ...
  3. Black Swan

    An event or occurrence that deviates beyond what is normally expected of a situation and that would be extremely difficult ...
  4. Inverted Yield Curve

    An interest rate environment in which long-term debt instruments have a lower yield than short-term debt instruments of the ...
  5. Socially Responsible Investment - SRI

    An investment that is considered socially responsible because of the nature of the business the company conducts. Common ...
Trading Center