College Planning: 3 Key Facts Every Parent and College Bound Student Should KnowSubmitted by Reby Advisors | Certified Financial Planners | Danbury, CT on August 23rd, 2018
Just one year of college can now cost anywhere from $20,000 to $60,000 and beyond depending on the university – more than a 260% increase since 1980, according to a report from the Department of Education.
This is unaffordable for many families, forcing many parents to choose between retirement and paying for college – and causing students to take on astronomical debt that leads many to question whether their investment in college was worth it.
How can you pay for college without going broke? Here are three key facts to know:
Fact #1: Your Expected Family Contribution (EFC) May Be Impacted by Simply Filling Out Paperwork in the Right Way
Expected Family Contribution (EFC) is the minimum the government and a college expect a family to pay per year for college. It is calculated based on the family’s income and assets.
However, there are cases where families with low six-figure incomes receive need-based aid while some low-income families receive nothing in need-based aid. Why? Because the low-income family did not file the paperwork correctly and the low six-figure income family did. Many times, what your expected family contribution as computed
Fact #2: You Do Not Have to Pay Full Price!
Many families get sticker shock when they first start researching colleges, but keep in mind that the tuition and board listed on a college website or in books is the maximum you may have to pay. Stephanie Goldberg-Mauro, the Founder and Owner of College Planning 101, explained how it works in our Quarterly Newsletter:
“In addition to qualifying for aid based on your EFC (and properly filling out the paperwork), positioning a student in the right way may reduce costs as well. Every college teaches to a different level - RPI teaches to a 1390/1600 SAT score while Long Island University (LIU) teaches to a 990/1600 SAT score. So, if your student has a 1250/1600 SAT score, they will get merit money from LIU. If they have the right GPA, they would get into RPI but you’d pay full price. Most colleges admit students by GPA and offer merit money based on SAT or ACT Scores as well as attributes and athletics.
Calling the college and asking what scores qualify for merit money and what GPA is required for admissions are great questions and gives your student a goal to shoot for.”
Fact #3: Where You Keep College Savings Impacts Financial Aid
To qualify for financial aid, you’ll need to fill out your Free Application for Federal Student Aid (FASFA) to be eligible for award grants, work study, scholarships, and student loans.
For aid consideration, it matters where the savings are. It’s more difficult to get aid if most of the savings are in the child’s name. Funds in 529 college savings plans are scored lower for aid purposes than money held in a child’s trust (UGMA/UTMA accounts), that is, in their name. So, keep as much money out of their name as possible.
Learn More in Our Free Class, How to Pay for College Without Going Broke
If you, your child or grandchild face the daunting challenge of paying for college, I recommend signing up for our upcoming seminar How to Pay for College Without Going Broke with special guest speaker, Stephanie Goldberg-Mauro, the Founder and Owner of College Planning 101.
With over 15 years of financial services experience, Stephanie has a wealth of knowledge that can help you, your child or grandchild go to college at the lowest cost possible.
Stephanie will delve into the differences between the FAFSA and CSS Profile financial aid forms and discuss how they affect the cost of college. She’ll also explain what financial aid really means and how need is determined.
Other things you’ll learn by attending this free class are how the financial aid system works, what assets can take away from qualifying for financial aid, why you need to calculate your EFC before visiting colleges, differences of various loan programs, and plenty more.
While the class is completely free, space fills up fast and it’s encouraged that those who want to attend How to Pay for College Without Going Broke sign up immediately to reserve their spot.
Sign up for Wednesday, September 12, 2018 at 6:30pm or Saturday, September 22, 2018 at 10:30am. You can click below to sign up now so you can have one less thing to worry about in the future.
Click the banner below to learn more: