Paying For College

 

The first line of defense to pay for college is to get as much need-based, merit-based, and private-based financial assistance that you can achieve. You achieve this by getting high ACT/SAT scores, getting a great GPA, and picking colleges that make sense academically and socially for the student but also financially for the parents. What you want to avoid is panic mode. Imagine you are a parent of a HS senior and you just found out you need $15,000 a year for your son to go to college. You have not saved $15,000 in 18 years of their life, what makes you think you can come up with that money in 6 months? Obviously panic mode will start to set in and once parents are stressed, they tend to make hasty and unwise financial decisions. So another key defense is to start early. Save as much as you can but you also must be a realist. If you had started saving money the day they were born you would not have saved enough because the cost of college has sky rocketed. That does not mean you throw up your hands and give up.

 

What you need to do is to focus on the things that you can CONTROL. For example, you should take the ACT test as many times as it is offered. There is no risk. They usually only take the highest score and it is not cost prohibitive at $31. So why don’t more students take it more frequently? Secondly, you should invest in your student. If you had $1,000 in a Custodial Account, most families will hold that money to use towards the first year of college. In my opinion, the $1,000 does you no good unless you have the balance of the expenses saved as well. Taking it one step further that $1,000 would not be any good unless you had enough money for all 4 years of college. Most families would be better off investing that $1,000 into their student when they started high school to ensure they took the right courses, did AP courses, got ACT/SAT Prep to improve their scores, kept up their GPA, found private scholarships, filled out all the paperwork correctly and on-time and met all the deadlines, and figured out how to pay for college without going broke. This would be a better investment, because you potentially could turn that money into $40,000 or more by navigating the college maze the correct way.

 

We show parents how to pay for their out of pocket expense without depleting their retirement accounts, without taking out huge parental loans, or mortgaging their house 30 years. Information = Knowledge, and Knowledge saves money when it comes to college. There are basically 9 ways for most family’s to pay for college. We will look at each option as it affects the three phases of your life.

 

We look at each option how it affects you immediately from a cash-flow standpoint, the day they graduate college from an intermediate standpoint, and 20 years from now in a long-term standpoint. It is our humble opinion, that until a family sits down and takes a look at all 9 options on how to pay for college as each option affects them short-term, intermediately and long-term, they will not make a qualified decision on How To Pay For College. The reason is because human nature is to pick the option that is the easiest now and to deal with the other later. Well later is 3 more years of college bills for student one and then followed by the next group of children you have to educate. You then find yourself with your head spinning and a mound of debt wondering how you let it get to this point. How you avoid that financial collapse is by calculating each family’s EFC to see how much they need each year for college and then multiply that number by the years they will have a student in college. You then take a look at all 9 options on how to pay for college as each option affects them short-term, intermediately and long-term and you figure out what is the most tax efficient, financial aid efficient and cash-flow efficient way possible to pay for college.

 

College expenses are a rain cloud. How you choose to pay those expenses will affect the rest of your financial life either in a positive way if done correctly or a negative way if not. You have worked too hard and long to leave this to chance. You owe it to yourself and your children to at least come talk to us for an hour to evaluate your situation. We guarantee you it will be the most life-changing hour of your life.