The Struggle of Paying for College: How to Come Up with a Good PlanPosted May 1, 2015, 12:00 pm by
If you worry about paying for your child’s college education, you’re not alone. A recent gallup poll ranked it as a parent’s chief financial concern, putting it above saving for retirement, medical expenses and paying the bills. Since 2001, Gallup has asked more than 16,000 Americans how much they worry about each of eight separate financial matters, ranging from having enough money for retirement to making minimum payments on credit cards.
This year’s poll found 73 percent of Americans with children younger than 18 say they are "very worried" or "moderately worried" about paying for their children’s higher education. In fact, Gallup noted that “parents worry more about college funding even more than the most financially vulnerable group—low-income Americans—worry about any financial matter.”
In Princeton Review's annual “College Hopes & Worries Survey”, 90 percent of those who responded said financial aid was very or extremely necessary to pay for school. As for worries, the biggest concern was debt. Of the students who complete their degrees, 86 percent of them are taking out loans. Last year it came out that in America, student loan debt has surpassed one trillion dollars.
Parents Struggle to Pay for College
Being a parent can be both rewarding and challenging. Some of parents' greatest challenges are financial, particularly if they hope to pay for and send their children to college. High college tuition bills are a financial burden for many American families -- especially those who are low or middle income. Because of high tuition bills, many students accrue large amounts of debt in college that puts them at a financial disadvantage once they enter into adulthood.
Parents know that the promise of higher education is a well-paying job and a better life after paying for college and earning a degree. This promise often leads parents and students to enter into debt to pay for that degree. Even though it is well-documented that college graduates earn far more over their lifetime than those who do not graduate college, that finding is not enough to ease parents' worry about how they will pay for their children's education.
How Do You Remove the Worry?
The solution is complex. Worry is only removed when a strong plan is in place and the family members are aware of the financial issues.
1. Plan early
Parents should plan for college costs early in their child’s life. They should not stop there, however. At an early age, begin discussing the importance of an education, good grades and a commitment to study all throughout school.
2. Be open about finances
When your student begins applying to college, do your research. If the tuition is financially out of reach, move on to another school. Have a money talk with your student before he begins the college search.
3. Find the best fit college
If your student is at the top of the applicant pool (the best of the applicants) he is more likely to receive merit aid to pay for tuition. Do your research and discover which colleges pay the most aid and which colleges would consider your student a top applicant.
4. Discuss options
Would it be financially doable if your student attended a college close to home and commuted? Would a community college save money on costs? Should your student work and go to college, paying as he goes? How can the family budget effectively to find more money to pay for college?
5. Expect participation
Expect your student to participate in the financial process. He should apply for scholarships, work during high school and save, study and get good grades, study for standardized tests, take AP classes to get college credit, and plan to work in college.
Every family has financial concerns. Planning for the future of your child’s education can help ease or remove the worry altogether.