5 Tips to Save for College
Sending your children off to college is an important parental achievement—congrats! Now how are you and your student going to pay for it? Cost of tuition, books, and campus fees are continuing to rise, but higher education is still a great foundation for future successes. Here are five tips to share with your undergrad before they pack for school.
Test Out of Classes
If your child is still in high school, they should consider enrolling in advanced placement (AP) classes. When your child passes the exam after their AP class, they may be able to skip general education classes in college. The CLEP test (College Level Examination Program) works in much in the same way. After they’ve graduated high school, they take the CLEP test which places them in the appropriate college level class based on their current knowledge of particular subjects.
Consider Your School
Attending a community college is a great way to save money. Community colleges offer courses at a much more affordable rate than a university or private school, and most credits will transfer. You can complete prerequisite classes, or you can earn an associate degree after two years. Both will help with job placement or transferring to a four-year university. Also, students can live at home while completing these credits and save money by not paying rent or room and board (sorry parents!).
PRO TIP: Consider your course of study, career plan, and how much you expect to earn after graduation before enrolling in college.
Scholarships, Grants, Financial Aid
Encourage your children to apply for financial aid. By applying for financial aid with a FAFSA, (free application for federal student aid) your children will know how much money they are eligible for in the form of grants or scholarships (money that does not need to be repaid) and the amount of potential loans needed to pay for tuition. Obviously, the more grants and scholarships awarded, the less they’ll have to pay back after graduation. Click here for more information on applying for a FAFSA and how financial aid can help save you money on college.
Find a Job, Save Money
By having even a part-time or work study job on campus, your child’s income could be used for rent, food, textbooks—anything they may need! By having a job, your student is getting accustomed to “adult life” by balancing responsibilities and obligations and gaining valuable workplace experience. Opening a savings or checking account at a bank they trust (if they don’t already have an account) is a safe, secured, federally insured place to hold surplus income where it can build interest and grow.
Student loans have a bad rep, but they’re not all bad! The key is determining how much you will need to borrow—after you have exhausted all other options—and borrow as little as possible. If your children do borrow student loans, it’s important that they have a plan for repaying those loans when they graduate. No two student loans are alike: there are private, federal, and PLUS parent loans; variable interest rates, subsidized and unsubsidized loans, and more. It’s best to do research before borrowing so your child knows their repayment options and obligations. Here is a great resource on repaying student loans.
PRO TIP: Paying interest on loans while enrolled in school will save thousands of dollars later.
Attending and paying for college is not a one-size-fits-all situation. You may need to use more than one strategy to pay for school, and that’s totally normal. As long as your student is organized and informed, they’ll have a much easier time paying for school, graduating on time, and entering adulthood as a successful young professional.