It is every parent’s dream to see their child off to college. Not only is it a significant milestone for the child, but it is also a proud moment for all parents! Today that college education is considered a privilege, rising college expenses are subjecting families to a tremendous amount of stress!
Sending Kids to College: Why Does It Matter to A Parent?
A college degree boosts your credentials. It opens up career opportunities in life. As opposed to earning only a high school diploma, obtaining at least a bachelor’s in any field promises a broad range of employment options. According to the Economy Policy Institute, college graduates earn nearly 50% more than high school graduates. In today’s employment landscape, jobs that require a bachelor’s degree offer more benefits and opportunities for advancement.
But here’s the reality that’s keeping parents from fulfilling that dream for their child: college costs that are soaring through the roof.
Just how ludicrously expensive has college become? A study conducted by the Institute for Higher Education Policy (IHEP) revealed that in 2017, 70% of colleges in the United States are beyond the reach of lower- and middle- income families. In that same year, the sticker price for the average private college tuition was $45,570. In public schools, the average cost was $20,090. Indeed, new college students who attend a 2-year or a 4-year program in a private or public school at any given time are paying more than those before them.
What You As A Parent (and Your College Kid) Can Do
Here’s our take on this prevalent problem: The hefty price tag of college continues to be a real challenge for the average American family, but in no way should it become a dream killer. With some careful planning and a lot of patience, you can mark these college costs down significantly so they don’t ruin your budget. There are ways to do it; you just have to know where to look!
Are you completely sold to the idea of seeing your children pursue and complete higher education for their future? Here are some of the proven ways and actionable tips for a step closer to that college dream for them:
Look Into A 529 Plan
Saving up to pay for future college costs is a fail-proof strategy. While you can do this using a regular savings or a taxable investment account, a 529 Plan can be the viable option. You can open a 529 Plan, an account that you can withdraw money from–federally tax-free at that under the condition that you will use it for education purposes. What’s great about the 529 Plan is you can start with it while your child is still in high school. Should your college dreams don’t work out for the child you intended it for, you, as the account owner can transfer your 529 Plan funds to another qualifying beneficiary or family member, such as your other kid.
Families know for a fact that the more they save for school, the less debt they will incur. However, a 2017 survey by financial services firm Edward Jones showed that 7 out of 10 Americans are not aware of this option. Other studies support this data, as their findings also revealed that 529 college saving plans are “underutilized” because most parents are unaware of this saving strategy.
Your 529 Plan may limit your child’s eligibility for college aid. Need-based financial assistance generally does not qualify 529 beneficiaries. However, schools have different methodologies for determining and granting financial aid so it will depend on the college your child will attend.
File for FAFSA
The Free Application for Federal Student Aid (FAFSA), more commonly known as the FAFSA, is a form that a college student fills out to receive federal aid. It features federal grants such as student loans or the Pell Grant. According to a 2017 analysis by NerdWallet, $2.3 billion in federal grant money was left unclaimed because students did not fill out their FAFSA form.
Speaking of filling out the FAFSA form: make sure that the applicant does not make any mistake! First, fill out the form ahead of time; cramming is not an option. Second, always double check. A single error in your social security number may cause your application to be revoked. Third, disclose every school you plan to attend. Fourth, never use a pseudonym. Fill out the form with your legal name. Fifth, include correct IRS information. Most importantly, do not leave anything blank.
Apply for Scholarships
Scholarships are some of the most famous options. There are several scholarship programs in your state that can help with your college child’s tuition costs. In most cases, these programs require students to maintain a certain GPA grade or do volunteer work. It is recommended that students apply for scholarships before going to their college of choice.
Searching for a scholarship that is right for your child may be very exhausting but in this era of instant information availability, this task has become easier. Many schools also provide a list of scholarships students can apply for. You can also research or ask around to find private institutions, companies, nonprofits, and community groups that award scholarships. Just make sure that your child submits the requirements before the deadline.
Explore Work-study Jobs
Another option is for your college kid to get part-time work while studying. Many schools offer jobs for students or assist them in finding work to give their budget that extra cushion. Most of these pay at least once a month. In some work-study jobs, your meals, board and lodging, and transportation costs are covered. To qualify for these jobs, the student will need to present their filled-out FAFSA form. Work-study jobs don’t only help your family pay for college; they let your child gain valuable work experience that can lead to bigger opportunities.
You can opt for jobs on-campus or off-campus; both are available at your disposal. If you choose to work on-campus, your employer will probably be within your college. Working off-campus means you will be in a private institution or a non-profit.
Consider Concurrent Enrollment
There are cases when states allow students to earn college credit for classes that they attended in high school. Concurrent enrollment lets high school students receive college credit prior to graduation for enrolling in college courses that are usually taught by college professors.
Concurrent enrollment helps a student minimize college costs through college credits while also giving them that college experience. It is a low-cost option that allows students to gain college exposure while still in high school. This program is usually run by public universities and, depending on where you live, the credits you earn can be transferred to state schools.
Get Parent PLUS Loans
Parents have the option of borrowing money through the Parent PLUS Loan. It is a reasonable means of paying for your dependent undergraduate’s education. The loan has a fixed interest rate and a flexible loan limit. However, this is not highly suggested as a primary option. Before parents can apply for Parent Plus Loan, they are advised to get their children to explore other ways such as Direct Loans with considerably lower interest rates and fees.
That said, the Parent PLUS Loans worked well for many parents of college students. Do in-depth research of Parent PLUS Loan to see how it can help ease your financial burden and address student loan problems.
Go For Tuition Reimbursements
Tuition reimbursement is a genius program that many companies offer to attract top talents to join them right after graduation. It is essentially an offer to reimburse some or all tuition and fees that their employees spent during college. It is a win-win arrangement for both parties – the company gets highly skilled graduates, and the employee receives a quality education and a shot at becoming part of a company. Simply put, it is a means to an end that produces loyal and goal-oriented members of the labor force.
Every company offers a different tuition reimbursement arrangement that considers the amount to be reimbursed and the conditions that apply to the program. They also vary their refund terms, taking into account the student’s academic standing and performance in the company.
Find Student Research Positions and Internship
Colleges and universities all over the country are committed to providing their students with numerous financial aid opportunities. Through Student Research positions, college institutions are honing the next generation of expert researchers. Plus, the position is an excellent opportunity to train students to become proficient in all levels of research across all disciplines.
Internships, on the other hand, provide college students with a chance to broaden their knowledge while gaining practical and hands-on experience in their industry of choice. There is a program that will allow you to spend your internship at the White House, particularly through the U.S. Department of State Student Internship Program. Duties in the White House include participating in meetings of senior-level officials, as well as drafting, editing, and contributing to policy-making. This experience lets you engage in government processes. You can find various internship programs in your state.
Live Off Campus
A wise way to reduce college spending is to live off campus. Finding a roommate to share your expenses with lets you stay clear of incomprehensible student debt. Did you know that this strategy cuts your rent by half and gives you sizable savings? Living off campus saves you an average of $219 in monthly rent payments. That is a lot for a financially struggling college student!
There might be a few caveats that come with living off campus. Residing in the vicinity of your college does cost higher, but you get easy access to the campus with less travel time. But all things considered, traveling is a small sacrifice for quality education—and you save in the process too.
With college costs reaching an all-time high, many view higher education as an opportunity for the privileged few. For a parent who knows how education can impact their child’s professional future, the financial challenges are all but insurmountable–thanks to the many money-saving options that are worth exploring.