Here at the Center for College Planning we meet with families that have had to choose between saving for their retirement and saving for their child’s college education.  Here is an article that explains that while it is ideal to save for both at the same time, it is not a possibility for every family.  If given the choice, parents should consider saving for their retirement before saving for their student’s college costs because there are options available to pay for college; you are unable to borrow for retirement.

So what are some of the ways that families can finance college if they have been unable to save (or have saved, but not as much as they will need to fund college)?  There are college tuition payment plans that some families utilize for a portion of the balance.  If you as a family know that you can contribute say $100 a month for 10 months, that means $1000 less that will have to be funded through another source.  If it’s $1000 less that is borrowed, that’s less money accumulating interest over a 10 plus year period.  That can add up to real savings!

Students are able to borrow $5,500 in their own name at a fixed interest rate from the government (for their 1st year of college if attending full time).  This loan is called the Direct Stafford Loan and the application for it is completion of the FAFSA form.  Some parents choose to take out a loan in their own name from the Federal government.  This type of loan is called the Parent PLUS loan and it has a fixed interest rate of 7.9%.  For more information on both of these loans, click here.

And hopefully students are awarded scholarship (based on merit) and grant money (based on finances), both free sources of aid.  These can be given from the government, college or through a private source.  The FAFSA, and possibly the CSS Profile are the applications for all grant money, but students should research scholarship options through their high school, town and private organizations.  Check out www.nh93.com for some great local scholarship opportunities.  Every little bit adds up and goes a long way to help defray the cost of college.  Even if your student is not a senior in high school, but a sophomore or junior, encourage him or her to research these scholarship opportunities.  Some are available for underclassmen and even if they are not, it’s helpful to know their eligibility criteria in advance.  It may give the students the motivation needed to complete the requirements for the various opportunities.

If your family would like free help completing your student’s FAFSA form schedule an appointment to meet with us in our Concord office.  We also meet with families to discuss funding options once students have received their offers of financial aid from their colleges.  Call us at 888.7.GRADUATE ext. 119 to schedule your free 1 hour appointment.

Explore college funding opportunities today,
Val