Category Archives: financial planning

college planning, financial planning, parenting

Saving Money on College Costs

1 Comment

During these tough economic times, parents are committed to saving money on college costs. College tuition rises each year and there is little you can do about it; but there are other places that small savings will add up. Tuition will definitely be the huge chunk of your expenses. However, there are other expenses related to college where you can find some costs savings:

The expenses that cost the most

  • Computers—In today’s technological world a computer is no longer a luxury, it’s a necessity. When your teen goes off to college, they will need their own computer. Personally, I recommend a laptop instead of a desktop. Since it’s portable, they can take it with them to class, to the library, and to group meetings. To save some bucks, shop online for refurbished or even last year’s models. If you buy online, consider purchasing a service contract to go along with your computer purchase (Note: This will pay for itself—I learned from experience!)
  • Dorm furnishings—Most dorms come furnished with a bed, a desk and some sort of dresser. Beyond that, it’s up to you and your teen to decide what additional furniture and accessories they want. My recommendation is to buy used. You can find everything from small appliances (microwaves, coffeemakers, etc.) to furnishings (bookshelves, chairs and lighting) on Craigslist, Ebay or at local thrift stores. Be careful not to overload the room because they are traditionally small.
  • Room and board—Room and board can be a huge portion of your teen’s college expenses. One option is to live at home if the college is within driving distance. Another option to save might be to purchase a home near campus and rent it out to other students, allowing your teen to live in it. Not only will this save you on room and board, but it will also provide you with an investment and tax write off as a rental. However, make sure the home is zoned as rental property. And here’s one of the best savings of all: after freshman year, your teen can apply to become an RA (Resident Assistant) in one of the dorms, which will provide you with a huge break on room and board costs.
  • Meal plan savings—Most freshmen are required to purchase a student meal plan. But, there are usually options available. My recommendation is that unless your teen is an athlete with a large appetite, the full meal plan (3-meals a day) is costly and you will not get your money’s worth. Opt for the 1 or 2 meal a day plans. Most freshmen eat takeout with friends, microwave food in their rooms, skip meals periodically, and snack voraciously. Providing them with an in room fridge and microwave will save you some bucks in the long run.

Textbook savings

College students can spend nearly $1000-1500 a year on new textbooks. The good news is that you don’t have to spend that kind of money if you don’t want to. If you can, prior to the beginning of each semester, find out what books your teen will need (title, author and ISBN, or international standard book number). Then get busy and here’s a word of extra advice: DON’T WAIT UNTIL THE LAST MINUTE! (Note: Look at my List of Website Links in the Expert Links for all the links related to Textbooks)

  • Buy used–Never buy new textbooks if it’s possible (unless you are a fan of throwing money away). Used books are just as sufficient. Most students use their textbooks only while they are in class and end up selling them back to the bookstore at an incredibly reduced rate. (Many times the bookstore won’t buy them back because the professor changes texts or the textbook has been updated). You can easily find used books online at discounted prices and your teen will arrive on campus with their books in tow and won’t have to fight the last minute panic rush.
  • Try renting–There are numerous websites available that offer textbook rentals to students per semester. This is a fairly new concept, but seems to be taking off as more and more sites pop up offering this option.
  • Purchase Ebooks–Consider purchasing electronic textbooks. With the recent introduction of the new Kindle College version, your student can download their textbooks and carry all of them with them. Without purchasing a Kindle, they can download the ebook versions and store them on their laptop for easy access. These versions are typically 50% less than the printed text version. The only downside is that not all textbooks are offered in ebook format.
  • Share books–After freshman year, my daughter shared textbooks with her roommates. It was a huge cost savings. They were usually taking some of the same classes and would get together before classes began to discuss who would purchase which textbook. If your teen is a freshman, the likelihood of having the same courses as their roommate is extremely high. Sharing the book will save both of them money in the long run. There is also the option of using a library copy.
  • Look for free books–There are a few sites that offer free downloads of some electronic texts. Before you purchase, visit those sites to see if any of the books you need are listed and downloadable.
  • Evaluate the necessity—Do you really need the textbook? Wait a few days into class and get a feel for the professor. If he or she states that the tests will cover lecture notes, then consider not purchasing the book. Worst case scenario you can borrow one from a classmate if you truly need it or find a copy at the library.

The small things add up

It’s amazing how those little expenses can add up: gas, takeout, necessity items. But just as little expenses add up, small savings add up as well and you will be saving money on college costs.

  • Ditch the car–Many campuses don’t allow freshmen to have a car on campus. But if your teen opts to live on campus and the college allows cars, consider ditching it. Everything your teen needs can be found on campus. And many colleges offer student transportation at very inexpensive rates if they need to leave campus or there is always the option of purchasing a monthly bus pass. In emergency situations, one or more of their friends will usually have a car that they can use or will offer to drive them.
  • Use the student ID card for discounts–Most fast food restaurants and local eateries offer discounts to students with campus ID’s. Those small 10-15% discounts can add up.
  • Finish in 4 years or less–Encourage your teen to stay on track and finish in 4 years or less. Most financial aid packages are only good for 4 years. Staying an extra semester will tack on additional expense and is not necessary since most degree plans can be completed in 4 years.
  • Use family insurance coverage if allowed–Some colleges charge students for health plans. If you have a good family health plan, and the student insurance duplicates what is already covered, get any charges waived.
FAFSA, financial aid, financial planning, student loans

A Parent’s Guide to Financial aid

financial aid

Financial aid can be a confusing part of the college application process. Even if you can afford to pay for college, it’s a good idea to learn what aid is available and apply for it. You aren’t obligated to accept it, but most students qualify for some form of aid and, if it’s available, why not use it?

What is financial aid?

Financial aid is intended to make up the difference between what your family can afford to pay and what college actually costs. With college tuition rising rapidly, more than half of the students currently enrolled in college receive some sort of financial aid to help pay for college. The system is based on the premise that anyone should be able to attend college, regardless of financial circumstances. However, students and their families are expected to contribute to the extent that they are able.

There are two types of aid: need-based, and non need-based. Need-based aid includes grants and scholarships that are issued based on the family’s ability to contribute to education costs. Non-need-based aid is allocated solely based on availability, not need.

There are three main types of financial aid: grants and scholarships, loans and work study.

What is “free” money?

Not all aid is equal and the best aid is the aid you don’t have to pay back. It’s like getting a huge coupon of savings to use for your college education. Here are the types of aid you can receive that you won’t have to pay back after graduation:

  • Federal Grants – These are grants given by the federal government.
  • Pell Grant – This grant is given to students with exceptional financial need.
  • College Grants – These grants are awarded by the individual colleges based on financial need.
  • State Grants – These grants are given to students who plan to attend college in their own state (and states are strict about residency).
  • Private Scholarships – There are a multitude of private scholarships available awarded by private organizations and businesses for every type of student.
  • Institutional Scholarships – These scholarships are given by individual colleges based on the student’s qualifications or financial need.
  • Federal Scholarships – Scholarships funded by government agencies.
  • Tuition Waiver – This waiver is offered by colleges to students who meet specific criteria (e.g. child of a POW/MIA)

What types of education loans are available?

Not all college loans are equal.

There are two types of government-based loans: subsidized and unsubsidized. Subsidized loans have lower interest rates and are awarded based on the student’s financial need with interest deferred until after graduation. Unsubsidized loans are awarded without regard to financial need with interest payments beginning immediately and regular payments due after graduation. Following is a brief description of each:

  • Stafford Loan – Government based loans that can be either subsidized or unsubsidized.
  • PLUS (Federal Parent Loans for Undergraduate Students) – This loan is for creditworthy parents and has payments due beginning 60 days after it is disbursed with relatively low interest rates.
  • Private Loan – Loan offered by private lenders usually with higher interest rates than government loans.
  • Institutional Loan – A loan in which the school is the lender.

Once you have chosen the loan that best fits your needs, do the research and educate yourself about repayment, interest rates and grace periods.

To learn more about work study, the FAFSA, the EFC and award letters, read the entire article I wrote for TeenLife Online Magazine here.

financial aid, financial planning, Student debt

How To Avoid College Debt

1 Comment
college debt

Parents want what’s best for their children. I’m sure you do. You want your student to succeed in life and if that path is college, you don’t want them to be saddled with college debt after they graduate. Entering the work force with debt puts strain on your student and their ability to live independently after college.  

But with college costs rising it almost seems impossible to attend without borrowing money to pay for it. At least that’s what you might think; but with some smart planning and wise financial choices, I t can be done and here’s how:

Know how much you are willing to pay

Before even starting the college search, you should know how much you are willing to pay. Set a budget before your student starts looking at colleges. If you know how much you are willing to pay, you can avoid going over-budget on a college, even though it’s a college your student wants to attend.

Have the money talk

After you know what you’re willing to pay, have the “money talk” with your student. Discuss with them how much you are willing to pay for college and how much you expect them to contribute. Do not (I repeat do not) allow them to apply to any colleges beyond your financial reach unless your student has been working toward and receiving scholarship awards. Do not count on financial aid or merit aid to fill the gap when planning for college. If your student applies and is offered admission to a college you cannot afford it makes for a difficult conversation and a very disappointed student if you cannot pay for the tuition.

Research individual college statistics

Before applying, research the financial aid footprint of every single college on the list. How much aid do they typically give? How much debt does the average student graduate with? Use their net price calculator and determine what it will cost to attend there before applying. If your student is offered admission, there will be no surprises and disappointment if you do your due diligence before the application process begins. Colleges offering small percentages of financial aid in the form of scholarships and grant

Think outside the box

There are thousands of colleges in this country. Many families make the mistake of not researching affordable colleges before applying. Smaller private universities offer more generous financial aid packages. Recognizable names and Ivy League colleges are not the only schools offering a quality education. Don’t assume that a state university is cheaper than a private college out of state. Look at the numbers, research colleges, and think outside the box.

Consider community college

Two years at a community college will save you and your student a substantial amount of money. After completing the basics at a much lower cost, they can transfer to a four-year college and graduate. Your student may also choose an associate’s degree in a technical field and graduate from community college with a skill and a career. In the past, community college has gotten a bad reputation from parents and students for being “less than” a “real” college. But smart parents and students know the education is the same at a much lower cost.

Apply for scholarships

Until your student graduates from college they should be applying for scholarships. The sooner they begin, the better. There are scholarships for all ages and if your student accumulates awards all throughout high school and into college those awards will go a long way to help them graduate without debt. There are resources to help you and your student find and apply for scholarships—take advantage of them.

Get good grades

Scholarships and grants are disbursed by colleges based on merit. Grades are a key factor colleges use to determine merit aid. They use this aid to entice student applicants to accept their offers of admission. Putting your student at the top of the applicant pool with good grades stack the odds of merit aid in your favor. Believe it or not, a great GPA results in more scholarship money than athletics. Use this to your advantage.

Graduate in four years or less

You might be surprised to learn that most students take more than 4 years to graduate from college. On average, a college degree takes six years. That’s two years more of college costs, not to mention two years of lost income. Plan to pay for four years and make a plan for your student to stay on track.

Become a National Merit finalist

Your student doesn’t have to win a National Merit scholarship to score some generous financial aid. All they have to do is become a semi-finalist—and with a little study for the PSAT, it’s entirely possible. Colleges who have money set aside for the finalists will use merit aid to entice your student to attend: full tuition, room and board, books and fees, laptops, study abroad and even spending money. They might also offer automatic entrance into the honors college, the best housing and priority registration until graduation.

Take AP exams or CLEP tests before college

It’s possible for your student to take AP or CLEP exams and test out of freshman subjects. Your student could enter college as a sophomore, cutting a whole year off the degree. For a small test fee, your student can save thousands of dollars and time by taking advantage of these tests.

With all these options available, your student does not have to take on college debt to receive a quality education. With knowledge and hard work, your student should be able to graduate college debt-free.

financial planning

Establishing a Saving Strategy

saving strategy

One of the key elements of adulthood is learning to save for the future. Before your student leaves for college, it’s crucial to teach them how to manage money and save for the future. They will be bombarded with opportunities to spend, making saving a low priority. There will be the usual college expenses, entertainment and the temptation to frivolously spend while they are in college.

As their parent, you know the importance of saving for college and continuing to save for retirement. You can set an example by your actions and encouraging them to establish their own saving strategy. If you help them set up a savings account before college, it will be routine for them to put a portion of their earnings in the account during college; and, it establishes a good saving strategy after graduation.

Start in high school

CIT Bank can help you with their Savings Builder account. You can start an account for your student while they are in high school with as little as a $100 deposit. The savings you accumulate can be used for textbooks and any additional college expenses after high school graduation. Just a small monthly deposit of $100 quickly becomes $1000 and more to help your student with college expenses.

Here’s how it works

With $100 you can open an account with CIT Bank and earn up to 2.20% APY by making a single deposit of $100 or more every month. By using this online bank, it’s easy to grow and preserve your savings safely and securely because they are FDIC insured. There are no opening, monthly servicing, or line transfer fees.

You can easily access the funds in your account using free electronic transfers between your savings account and any other account at another bank; or, you can call and a check will be sent in the mail for free.

You can open a Savings Builder Account with CIT Bank by:

  1. Entering your information online
  2. Funding your account with a minimum of $100 with an electronic transfer or check
  3. You will receive an email confirmation and you are ready to start saving

The benefits of a saving strategy

By establishing a savings strategy for college, you are not only saving for those college expenses, but helping your student see the value and the benefit of putting money aside for the future. As the savings grow (with interest), you are teaching your student good money management and setting them up for financial success in the future.

financial aid, financial planning, student loans, Uncategorized

Paying for College: Borrow Wisely

2 Comments
borrow wisely

I received an email from a concerned parent whose student was going to be attending orientation next week. In the email, he confessed that he might need some help with information regarding financing his son’s college education. I was surprised that he waited so long. Unfortunately, I had to advise him that at this point his only options were private loans and advise his student to apply for scholarships over the summer.

Parents should consider college funding even before their student applies to college. The inevitable result of lack of planning is parents and students borrowing to pay and usually borrowing more than they can repay after graduation.

What do the statistics say?

With school starting shortly, student loan borrowing often appears in the news. It’s especially prevalent now with presidential candidates promising to erase student loan debt. Wherever you stand in the political landscape, it’s clear from the statistics that students have borrowed more than they can repay.

According to a 2018 report by the Federal Reserve Bank of New York, as many as 44.7 million Americans have student loan debt, that’s one in five adult Americans. The total amount of student loan debt is $1.47 trillion as of the end of 2018 — more than credit cards or auto loans.

How do you make wise financial choices?

Before applying to college, you and your student should investigate the cost. You can gather the information either on the college website or by using College Navigator. When viewing these figures, you should also research the college’s financial aid statistics—what percentage of students are awarded aid, how much aid is awarded and how much do students typically borrow. Since every family’s financial situation is different, these figures should help determine if the college is affordable to attend.

How does financial aid play into the equation?

If you complete the FAFSA, your student will receive some form of financial aid. The most common is student loans, but colleges also award grants and merit aid as well. Always complete the FAFSA, even if you don’t think you will qualify for aid. Colleges use the information on the FAFSA when awarding scholarships and grants. No FAFSA, no aid.

What’s the key to avoid borrowing too much?

Use repayment calculators before you sign on the dotted line. The rule of thumb is that students should only borrow as much to pay for college as their first year’s salary. By keeping your debt under one year’s salary, you won’t have to put more than about 10% of your income towards student loan payments. Borrowing more than your student can afford to repay sets them up for overwhelming debt after graduation. Your student can look at salary comparisons for their anticipated career at PayScale.com.

How can you avoid borrowing to pay for college?

The key to not borrowing to pay for college is to receive merit aid, grants, and outside scholarships. Your student should apply to a college at the top of his or her applicant pool. This means the college will be more likely to award aid to attract your student. Grades and standardized test scores are also a key factor in awarding aid. Your student should focus throughout college to pursue excellence in these areas. And, don’t forget outside scholarships. Your student should focus time and effort in applying to every scholarship he or she qualifies for. This means starting early and planning to submit the best application. Click here for scholarship application tips and see how your student can win enough money to pay for college.

Finally, borrow wisely. Only borrow what you need. Your student can borrow the maximum amount, but only borrow what is necessary. Just because you can, doesn’t mean you should. Choose the loans with the lowest interest rates first.

financial planning, parenting

Saving Money During College

saving moneyIf your child (or soon to be adult…) is off to college, then you could be worried about a few things. Are they going to fit in? Will they enjoy their experience away, or get homesick and struggle in their new city? Do they have enough knowledge about finances to get by? Well, we’ve spent a lot of time considering the latter question, so that you can be sure that your child is prepared when it comes to finances. Rest easy knowing that they’ve got it covered, by remembering these simple tips:

Teach them what you know

The reason that many kids at college struggle so much with finances, is because nobody has taught them how these things truly work. You don’t have to sit down and lecture your kids on this, but make sure you give them some tips in the months leading up to their big move to college. If they can’t cook breakfast and don’t know how to pay rent, they’re going to have some real problems. You can prevent all of this with a bit of advice, and it will go a long way, so show your child how to manage things like bills and rent (especially if they’ve been planning to eat cereal for every meal of the day…).

Use technology to budget

Helping your child to sort out a budget will be really useful to them, especially when they’re going it alone. The days of sitting down and trying to distinguish what you’ve spent, and where, are gone, and you no longer need to sit there with a pen doing the math for hours. Utilize the technology that is out there, and make sure your kids have the best money management app available. Your child probably spends a long time on their cell phone, and won’t forget about budgeting if it is right in front of them. We can’t promise that, but it’s worth a shot.

Emphasize the importance of researching

Ok, we don’t mean academic researching here, but if they have the skills to do it, then why let it go to waste. Many college kids decide that they need something – and this could even be a textbook – and then just buy the first copy of it that they come across. Please, don’t let your child do this, when they could get second hand copies from places like eBay for a fraction of the cost. There are plenty of online stores that specialize in used books, and doing your research first could save you hundreds of dollars over the academic year. Research, research, and research again. You won’t regret it when your wallet shows you the benefits.

So, there we have it. Some simple tips to help you to help them, when it comes to sending your kids to college. Teach them everything you know about finances, bills and rent, use the latest technology to budget, and make sure that they research before they splash out on expensive resources. Good luck!

financial planning

Managing College Finances

college financesThere are many aspects to college life which both you and your children need to get used to and understand as effectively as possible. One of the most important however is that of money – you of course want to make sure that your children are going to be secure financially, and that they will understand how to approach and deal with their money on the whole. As long as you can be sure of that, you will find that it is much easier to send them off without worry, so this is something you should think about for your own sake as much as theirs. In this post, we will take a look at a few of the concerns to consider if you want to help your kids through their college years in a financial sense.

Getting A Loan

The vast majority of students need to get a student loan in order to survive college, and that is something to make sure you are thinking about as early as possible. Encourage your child to apply for their loan early, to ensure that they get it in time, and back sure that you help them along the way wherever possible too. You might need to provide some information yourself as part of this process, so be prepared for that as well. Once they have that loan, that will make college much easier – but remember that it is technically a debt, even if not a terrible one to have. It is possible that years later they might be able to apply for student loan debt forgiveness or have it wiped off – or they might manage to pay it off instead. Either way, it needs thinking about.

Money Management

It might well be that this is the first time your child has had to manage their money on their own, and as such it’s likely that you are going to want to help them with this process. Chances are, they won’t really know what to do here, so you might need to help them along and teach them what money management means. By doing that, you help to keep them out of debt and financial worry, and you ensure that they are going to be able to master their finances much more effectively as a result. Bear that in mind and you will find that it makes a huge difference for them as they attend college.

Helping Them Out

There might be occasions where you need to help them out with your own finances, and there is nothing wrong with that as such. When this is the case, you should of course make sure that you don’t allow them to suffer – but you should also think about trying to encourage them to help themselves first and foremost. That could mean arguing that they need to get a part-time job, or it might be that you want to just give them tips on how to look after their money better, as above. However you do it, be sure to help them mostly by allowing them to help themselves.

college guidance, college planning, college prep, extracurricular activities, financial aid, financial planning, organization, scholarships

Getting In to Your First Choice College

3 Comments

first choiceWhile many students are busy packing their bags and getting ready to leave for their first year at college, still others are working on their applications for the next round of admissions. Of course, if your child fits the latter category, it’s likely that they already have a college in mind that they wish to attend. Happily, by reading the post below you can find out about the tactics that will help them get into their first choice. Keep reading to discover more.

Address any study or subject issues

Number one of the list tactics is dealing with grades, as this is the base level that a college application will address. Happily, this is something that you can definitely help your child with, without micromanaging them as well. Firstly, it’s vital that you take a keen interest in their progress with their studies, without being overbearing and demanding.

Then, if they or their teachers flag up an issue on a particular topic, it will be much easier to address this constructively. It may be that your child is struggling with a specific subject, or that something is going on in their life that creating a distraction for them. However, as long as you are able to have an honest two-way conversation, you will ultimately be able to get them the support or help they need to ensure that their grades remain on target to get into the college of their choice.

Help your child to present a rounded application

Please do remember though that while grades are essential for college, they are not the only thing that the application board with be looking at. In fact, lately, there has been a definite move towards reviewing the whole person and looking at their extracurricular activities as well as their academic ones.

What this means is that you can quickly help your child by encouraging them to engage in activities outside of the home. These may include sports such as basketball, football, and athletics, as well as getting them involved in community projects like food banks, reading programs, and soup kitchens. Even having a part-time job, or getting some work experience in a firm that is related to their studies can go a long way to helping them stand out amounts all the other candidates. Something that can help them secure that much-needed place in their first choice school.

Seek additional help

It’s also wise to remember as a parent that there is plenty of help out there both for you and your child when it comes to making a successful college application. First off there is lots of advice online that can take you through the process step by step, and also help you hone your child’s particular application documents.

Although, if your child is aiming at one of the top schools in the country it can be helpful to approach specialists like Ivy Select admission consulting for some additional help. After all, as they have been through the process of being accepted to an ivy league college, they are the best people to know all the little tips and tweaks to make to your child’s application for the best chance of them getting into their first choice.

Explore financial aid and scholarship options

Lastly, it is important to remember that it may be finance and scholarship issues that are standing in the way of your child getting into their first choice college. In fact, as university fees have risen so sharply in recent times, it is widespread for students to pick the more economically viable options, rather than where they genuinely want to go.

Luckily you can assist your child in dealing with this, by going through the costs of their course with them, and showing them what sort of budget they will be working on. You can even help them by demonstrating how this will affect their income when they are qualified and have to pay any loans back.

It’s obviously also important to openly discuss how much, if any financial help you will be providing to them, and not leave them guessing. After all, this may have a significant impact on whether they end up applying for the genuine first choice or not.

Lastly, it’s crucial that you also go over the options for scholarships with your child as well, and make sure that they understand these entirely before they make their applications. After all, the can be complicated and confusing and they may even need to start working on things like their grades or other requirements before it gets to application time. Something that you can support them with and that can ultimately help them get into their first choice college.

financial planning, how to

How to Save for College: A Numbers Game

 

save for college

There’s no doubt about it – college is a huge investment for you and your kid. Not only will you need to save up to cover the fees, you will also need to save to cover living costs as well. Many parents start saving when their children are at a very young age, but for many families, this is simply too much financial pressure.

The reality is that for many families beginning to save can only really happen a couple of years in advance when it becomes clear that your kid is heading for a college education. While many colleges offer substantial awards to help you, and student loans are available, if you want to make the most of the opportunity, it is best to save as soon as you can.

College Saving Plans

If you know that your kid will want to go to college in the future setting up a savings plan like a Roth IRA or a 529 College Plan will be a big help later on. There are also several other saving plans you might like to consider. These savings accounts work well because you can contribute any after-tax money and withdraw it tax-free when you are ready to start paying tuition fees.

These plans are also great because family and friends may also contribute funds (though there may be a small charge). This means that over the years, they can give you a helping hand to get your kid to college.

Investments

Investments can vary in risk and type and some may be quick while others are very much as slow burn. However, if you do already have some savings, finding the right investment could see a good return that will give your savings a boost.

Stocks and shares are quite volatile at times but they can be a good option for faster saving. You can also utilize covered calls to make the most of your current investments. You can read more about the basics of covered calls online, but essentially they are a kind of feint that protects your current investments while leaving an opportunity to profit open.

Side Hustling

It might sound terrible, but side hustling is a kind of job you can do in your evenings and weekend to make a little extra cash. There are lots of things you can side hustle and one of the most popular is blogging. All you need to do is pick a topic you find interesting and set up your page. Then, you can partner up with affiliates who will pay to post on your blog. It takes time to set up but can be a very easy side hustle once you get going.

Crafts are another popular side hustle and creating drawn versions of photos is very popular. Plus, if you are already crafting, it makes sense to sell your creations on sites like Etsy to make a small profit.

It’s never too late to start saving and even a few hundred dollars will help more than you think.

admissions, financial aid, financial planning

Should You “Follow the Money” When Choosing a College?

 

choosing a college

I’ve said over and over again to parents, “You’ve got to look at the statistics when it comes to paying for college.” Before the list begins, before the college visits start and before the applications are completed, you MUST know how much it costs and if you can afford to pay for it. You should “follow the money” when choosing a college!

Where can you find the statistics? You can do your own research on College Navigator or CollegeData, or you look at these compiled from a survey by the Princeton Review.

Look at these statistics from the Princeton Review’s 2018 Edition of Colleges That Pay You Back:

  • “Best Financial Aid” #1 Bowdoin College (ME) / #25 Macalester College (MN)
  • “Best Career Placement” – #1 Harvey Mudd College (CA) / #25 Cornell University (NY)
  • “Best Alumni Network” – #1 Pennsylvania State University / #25 Union College (NY)
  • “Best Schools for Internships” – #1 Northeastern University (MA) / #25 Gettysburg College (PA)
  • “Best Schools for Making an Impact” – #1 Wesleyan University (CT) / #25 Kalamazoo College (MI)
  • “Top Colleges That Pay You Back for Students with No Demonstrated Need” – #1 Harvey Mudd College (CA) / #25 University of Michigan—Ann Arbor

These are more than statistics. They help you decide if your college investment will be worth the cost. Your student may not be thinking along these lines, but it’s your job to bring them down to earth.

When choosing a college, ROI (return on investment) should be part of the decision mix. Take a look at these Top 50 colleges with the highest ROI.

What does the survey tell us?

Among the 200 colleges (135 private and 65 public) in the book:

  • the average grant to students with need is $26,800
  • the median starting salary of graduates is $55,700 and mid-career salary is $108,700.

Among the book’s 65 public colleges:

  • the average net cost of attendance (sticker price minus average grant) for in-state students receiving need-based aid is $12,700
  • the average admission rate is 53% and 12 colleges admit over 70%

Among the survey findings, 99% of respondents viewed college as “worth it,” but 98% said “financial aid would be necessary” to pay for it (65% of that cohort deemed aid “extremely necessary”).

Why should you consider these factors?

Before my daughter chose a college, we didn’t examine any of these factors. We compared financial aid packages, but we didn’t look for a college that was a good return on our investment. When it comes down to it, you spend a good amount of money on a college education. It’s an investment in your student’s future. We would never knowingly throw money into a bad investment or purchase a home high above market value, but every day parents invest their money in a college that won’t pay their student back.

Whether it’s career placement, networking, internships or tremendous financial aid, you should consider some of these colleges when making that final college list.