The Busy Parent’s Guide to Paying for
College: 7 Quick Tips To Lower Your
Out of Pocket Costs

Week 12 of 12

If you’re wondering where you’ll find the money to pay for your child’s tuition fees, then we’re here to help. We’ve put together 7 useful pieces of advice that you can use prepare for the big expenses of the next few years.

Let’s get started.

1. Identify Schools With A Wide Range Of Payment Plans

Many schools offer a good selection of tools that help take some of the pain out of paying the bill. These can include interest-free or low-fee installment payment plans, special scholarships, work-study programs, tuition remission, or even tuition-freeze programs which allow you to pay all four years up front, protecting yourself against tuition increases (a useful strategy these days, if you can afford it!)

Not all of these programs are likely to be good for you and your family, but there’s a good chance that some of them will be. It’s unlikely that you’ll hear about them from the schools directly. They aren’t often well publicized. You must take initiative and ask.

When you’re looking at schools, take the time to pick up the phone and talk to the admissions office about payment plans. You might find that some of the schools on your list are more affordable than you thought.

2. Make Sure You Have At Least One “Safe Money” School

When you use all the tips and resources included each week in this newsletter and make full use of all the help available through our office, it should be a breeze for you to position your finances and complete the applications on time, and in a way that gets you all the financial help you need.

However, it always pays to be a little bit cautious and include at least one ‘Safe Money School’ on your list. If the worst thing happens—and you find you can’t send your child to any of the top schools you wanted—you can always send them to your safety school in the first year and look for ways to move up in future years.

3. Start Spending Your Cash!

Most of the parents of children in their last couple of years of high school try to limit their spending and hoard up for the hard years ahead.

That can be a big mistake.

One of the factors that the financial aid administrators will use to calculate your EFC (your Expected Family Contribution—the amount that you’ll be expected to pay) is your current net worth.

That means that the money you’re saving for a new bathroom or to remodel the kitchen once the children head off to college could count against you when they total up the figures.

If you’re going to make a big expenditure soon, this could be the best time to do it. Before you make any final decisions though, make sure you speak to an expert who can give you the kind of objective advice you need to plan ahead. You’re welcome to call my office at (908) 857-4200 to arrange a FREE diagnostic evaluation.

4. Know Exactly When To Get The Forms In

One of the biggest mistakes parents make during their child’s last year at school is assuming that schools collect all the application forms then hand out the cash to the families with the most need.

It just doesn’t work that way.

Colleges like to plan ahead. The sooner they can get a good picture of how many classes are going to be filled and with which students, the happier they are.

That means they hand out financial aid on first-come, first-served basis. It might not be the fairest way to do it, but as far as the colleges are concerned, it’s the most convenient.

You can submit your Free Application for Federal Student Aid (FAFSA) form January 1st, but the Financial Aid Profile (FAP) for private schools will vary from school to school. It’s absolutely crucial that you know the earliest date that you can submit all your application forms—and that you have the forms ready to go when those dates roll around.

5. Be Smart With Your Assets

When the financial aid administrators calculate your EFC, they’ll take into account your entire net worth. That includes all of your material holdings: your checking and savings accounts, stocks, bonds, mutual funds, real estate, your college funds and private schools will even include the value of your home.

That usually puts college expenses way beyond most families’ monthly budgets.

One of the best ways to solve the cash flow crunch is to use a special “tax-favored” college funding solution. This solution won’t work for everyone, but it may allow you to improve cash flow, lower your taxes and allow you to pay for your child’s education without changing your lifestyle. Again, make sure you talk to a Certified College Funding Representative who understands the financial aid process before you make any decisions.

6. Apply For Financial Aid—Whatever Your Income!

The financial aid administrators take a wide range of factors into consideration when they calculate financial aid, not just income. Even if you have a six-figure income, it’s still worth completing all the forms and submitting an application.

The number of children you have in college at any one time, the size of your family and any medical expenses you might have to pay could all count in your favor when your application is processed—and result in savings worth thousands of dollars. Also, many schools won’t consider you for merit aid if you don’t complete the FAFSA application.

Don’t think you should bother with financial aid applications? Think again!

7. Encourage Your Child To Get Maximum Grades

You always want your child to get top grades so that he or she can get into the best school possible. But even if you know that your child will have little problem winning a place at the school of his or her choice, it still pays to finish top of the class.

Each school wants to attract the best students it can. They do this by offering the best financial aid packages to the applicants with the best G.P.A.’s and ACT/SAT scores.

To put it another way, a couple of extra points on your child’s ACT could be the difference between a loan that you’ll be paying back for years and a full scholarship with living allowance included.

It pays to put the pressure on now! Know that you will get the most college aid at the school where your child is positioned in the top 25% of the incoming class.

Those are just seven pieces of valuable advice, but they’re not the only things you need to know about applying for financial aid.

If you’d like to call my office at (908) 857-4200, I’d be very happy discuss the financial aid process with you, and create a unique plan that will help your family meet the expenses of the years ahead.

Whatever you decide to do, do move quickly. As I pointed out, late applicants can often find themselves left out.

Best wishes,

Ian Welham, CCPS
Certified College Planning Specialist
(908) 857-4200

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Ian R. Welham, Certified College Planning Advisor  -  Tel: 973.467.0101