High School graduation celebrates an epic milestone in life. Feelings of substantial accomplishment and pride, even the dubious sigh of relief, are well-earned sentimental expressions. Many students now feel an emerging sense of independence as they forge ahead in the direction of their aspirations for higher education. Surprisingly, many times, the realization of the ongoing need for family support throughout the college financial planning process becomes an unexpected revelation. How much thought have you given to what to expect when you’re expensing college education? A word to the wise: my most relevant takeaway from my daughter’s college experience is to expect the unexpected- always.
How does college tuition get paid? What length of time are parents obligated to finance the expenses of their children’s academic studies? Where are students expected to obtain the financial means to afford higher education without amassing a lifetime of student loan debt? These are just a few of the questions that arise in households across the nation as college financial planning is contemplated. Here is a checklist providing a guideline for students and parents to best get a headstart on navigating planning and budgeting for obtaining a college degree.
College Expense Planning Checklist for Students
Never assume. Have an early discussion with your family to best understand their financial involvement in contributing toward paying a portion or all of your college expenses. Decide together whether financial aid, student/parent loans, work study programs, savings contributions, scholarships and grants are viable options for affording college.
Figure out the expected costs of your education including tuition, related academic fees, books and supplies, housing/living expenses, meal plans or food costs, transportation, personal and medical care, and entertainment are typical factors to include in a projected budget.
Financial Aid Answers
Contact your school’s financial aid office to get answers to any question while reviewing the student aid package offered to help fund educational obligations. Take notes of any upcoming deadlines, possible additional aid matches, or requested documents required for eligibility.
Now is the time to dig deep- into those pockets. Will you be able to bring in additional income by working and attending school? Affording your college education requires an in-depth inventory of all sources of income. Research eligibility guidelines for need-based and merit-based scholarships to supplement budget gaps. Work with family, friends, and student advisors to explore all options.
Expect the Unexpected
Never did I expect to receive a bill from the local volunteer ambulance corp for transporting my daughter to the hospital on the day that her blood sugar dropped and she fainted on campus. Never did she expect that skipping breakfast, because she was in a rush would have such costly consequences. Keep money in the bank to establish an emergency fund. Build your credit profile by applying for a credit card to be used responsibly for unplanned circumstances.
College Expense Planning Checklist for Parents
The sky’s the limit works well in theory, however in reality college expenses should be capped within predetermined limits. Parent loans, student loans, and private loans are easily qualified for, yet not quite so easily repaid years later. Give your child a maximum tuition budget prior to beginning their college search to eliminate higher priced higher education options.
Find Financial Aid
Most college bound students are essentially financially dependent independents. With little or no income, parents, therefore, factor in heavily in planning and budgeting for college expenses. Financial aid availability is on a first come, first served basis. In the fall preceding the academic school year, begin the process of completing the Free Application for Federal Student Aid (FAFSA) application. Observe financial aid deadlines for the schools your child is interested in applying to for admission.
Not all loans are created equally. Opting to agree to the terms of the first loan offered to you may not necessarily be in your best interest. Take your time to research and compare estimated monthly payment facts and figures. Ask questions for a clear understanding of hidden loan fees, interest rates, and repayment terms.
Balance the Budget
College education is a worthwhile investment for career advancement in life, however, deciding who is accountable for financially investing toward tuition is a determining factor in establishing a budget. Parental involvement ranges from complete financial support to minimal, if any monetary contribution. Present your anticipated investment commitment to your child and explain the importance of their ability to finance the budget difference.
Expect the Unexpected
Firsthand experience from my own academic life and now as a parent has proven that the unpredictability of life is par for the course. Much that happens in life is beyond our control, however, we can control our response to these situations. Preparing an emergency fund and/or helping your kids to establish financial security for a little extra insurance is a win-win situation.