High school seniors have now confirmed plans to attend their chosen colleges, have accepted financial aid packages, and are waiting with excitement to get information about housing, courses, orientation and other first time college plans. It is a heady time in life: finishing high school, and moving on to college with the hopes of learning, growth, and preparation for life. Students are excited, wearing their chosen college sweatshirt as they head off in the final weeks of senior year. Among many parents, however, is the undertow of worry: How are we going to pay for college for our children?
Sunday’s New York Times front page story paints a dark picture: 94% of student who earn a BA or BS will have borrowed, many substantially, to pay for their college education. In 1993, 45% borrowed for college. The young woman profiled at the start of the article, now graduated from college is paying $900 on her college loans— and working in a restaurant.
Studies show that a college degree still pays, particularly with degrees in fields related to the job market (economics, business, engineering, sciences, etc.). At Informed Educational Solutions we are also firm believers in the profound life enhancement of advanced education in terms of lifetime contacts, inner self confidence, knowing how to find answers- solve problems- start from scratch. Most parents we work with are more than on board with this notion, and want the very best advanced training and learning for their children.
Applying for aid is more complex than ever, requiring online filing of the FAFSA, a second form (often CSS/Financial Profile) and the most recent tax return. Financial aid packages are also communicated online, and parents must look closely at the amount of institutional grant (straight, no strings attached aid), Pell grant (if any) campus work study, and loan— sometimes Stafford and sometimes institutional, or a combination of the both. Check the interest rate– being hotly debated at the federal level right now– and terms for repayment. This is a real debt. If masters degree, medical/law/business school is also a possibility– do some more math. We have occasionally advised students to consider two years at a local state or community college and then a transfer to the college of choice for the last two years in order to save significant money. 26% of all college students transfer.
1. Scrutinize the aid packages closely and figure the loan component seriously. It is in the student’s name. Who exactly is going to repay it?
2. Do not hesitate to make an appointment to meet with an aid officer to have a question answered or even make a plea for additional grant from the institution.
3. Be creative in your planning. A student living at home for the first two years of college and then transferring to a high ticket, high prestige institution is one strategy to save.
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