Millions of American students have just a few weeks until high school graduation. There are big things on the horizon for these seniors. For those planning to attend college after graduation, there are many things to consider when choosing a school, not the least of which is cost. While tuition and expenses may seem daunting, there are ways to help make higher education more affordable for many families.
Mary Jo Terry, a managing partner at Yrefy, gives CafeMom some tips to help families navigate the financial side of choosing the right college. Terry gives us info on saving, spending, and finding scholarship opportunities that many people don't even realize are available. Yes, it is overwhelming and confusing, but we are here to help.
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First, let's look at financial aid.
Terry explains that families should consider what financial aid they may qualify for before applying to colleges. First, she suggests the Federal Student Aid Estimator, a tool the US Department of Education offers. The estimator asks questions about income, assets, and other financial information, then gives an estimated family contribution and potential eligibility for federal financial aid options.
Second, she says that most colleges and universities must provide a net price calculator to help families determine expenses and the cost of tuition after grants and scholarships.
She also recommends families complete a College Board’s CSS Profile. Some colleges require the CSS application, and it allows families to see what non-federal and institutional aid families qualify for.
“It’s important to note that these tools provide estimates only and may not reflect the actual amount of financial aid a family will receive. Families should also be aware that eligibility for financial aid can vary depending on the college or university, so it’s important to research each school’s specific financial aid policies and deadlines,” she explained.
Next, Terry says families need to key in on scholarship opportunities.
Millions of dollars in scholarships are available to high school graduates that they may not even realize exist. Did you know you can get a scholarship for being tall or planning a career working with potatoes? Scholarship search engines like Fastweb, Scholarships.com, and Cappex are great starting places. Terry also recommends looking at local businesses and organizations that may offer scholarship money; think of your local Rotary Club or alumni groups. Professional organizations also give scholarships to students who plan to work in a specific career.
Terry says that the earlier families seek out scholarship opportunities, the better.
“It’s important for families to start looking for scholarships early and to apply to as many as possible, as scholarships can be competitive and have specific eligibility criteria. Families should also be aware of scholarship deadlines and requirements, and be sure to submit all necessary materials on time.”
Start college planning early and as a family.
Even though it may seem like a lifetime away, any parent knows that your child grows up right before you the second you blink. Terry says it’s never too early to start to plan for college, and setting up a 529 college savings plan and contributing often is a great way to start. She also encourages parents to teach their children to budget and live within their means to build good spending habits.
“Overall, encouraging children to prepare financially for college requires a combination of education, budgeting skills, and a focus on reducing debt. By starting early and setting clear expectations, families can help their children succeed both academically and financially,” she said.
Terry thinks that children should play an active role in choosing where they want to attend college, and they should also pay attention to the financials. Students need to understand the financial commitment and what student loan debt will look like. This can help them to decide how much debt is too much. She also thinks it is a good idea for students to get a job while in school to help save money for school and expenses.
Understanding debt is crucial.
Terry tells CafeMom that recent Institute for College Access and Success data shows the average student loan debt for the class of 2020 was $37,929. It is essential to note this is average and could be lower or substantially higher, depending on factors like what college a student chooses and their study area.
“Regardless of the amount of student loan debt, it’s important for students to have a plan for repayment and to understand their options for managing their debt. This may include exploring repayment plans, refinancing options, or forgiveness programs, depending on their individual circumstances,” Terry said.
Terry also points out that the COVID-19 pandemic impacted student loan debt, and temporary relief measures were implemented to help students repay their debts.
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It is also important to remember that college is not for everyone.
Success isn’t always dependent upon whether a person goes to college. There are certain things that families must weigh out before deciding the best career or educational path their child should take. Taking on a large debt may only be worth it to some people. Terry wants us to remember that it is OK to choose a path other than college.
“Ultimately, parents should work with their children to help them explore their options and make informed decisions about their education and career goals. This may involve discussing the pros and cons of attending college, researching alternative pathways, and encouraging their children to pursue their passions and interests, regardless of whether or not college is part of that plan.”
