You want your child to have the greatest college experience possible and get accepted into the best school he or she qualifies for. Perhaps you’ve already worked with them to identify their top potential collegiate picks or have attended on-campus tours. You’ve heard about the excellent academics, decked-out dorms and excellent food and facilities. Every college wants to make itself look ideal for your son or daughter.
Unfortunately, all those college bells and whistles can come at an astronomical cost. A full-time college education today at a private college can cost over $250K per student. That means a family with three kids could need $750 -1 million in funds to cover a four-year education for their kids. Yet many parents still look at colleges that aren’t really a feasible financial possibility for their child. The “let’s figure it out later” approach is not a wise way to start college planning.
That’s why you need to begin educating yourself and your child on the cost of college way before the application process begins. This two-part blog post will give you 10 Top Tips on how you can best prepare yourself and your child for the realities of the cost of a college education – so that their expectations are realistic before they set their hearts on a college that you just cannot afford.
Tip #1: Have family financial review meetings with your child.
Beginning in Junior year of high school or even earlier, have family financial review meetings with your child. At a higher level, discuss your family’s net worth, income, expenses, debts, and other challenges. If you have a financial advisor bring them to a meeting or have them prepare a summary of your last annual review meeting and discuss it with your child. Do not hide your family financial challenges from your children -- many of them already have an idea (they have been watching you most of your life). They are better off to know about the financial challenges and see how you deal with them. Let them know it is common and not the end of the world to have financial challenges to work on. Everyone does, even the wealthiest of people.
Tip #2: Talk about future family and financial goals.
Being able to send your child to a good college is only one goal in the scheme of your family life. Discuss all family goals and needs that you have to plan for. Aging grandparents, retirement, health care, business needs, vacations, and housing – all these life demands and dreams will require smart financial planning. By being open about these factors in life, you allow your child to begin to think about their own goals and financial responsibilities beyond just college.
Tip #3: Review the cost of college with your child.
Pick a college your child is interested in and review the total costs with them so they understand how it works. Visit with a financial aid office at a college, or set up a conference call to review the process around financial aid. Have your children talk to other college students they know from your town to learn how they handle their college-related financial challenges.
Tip #4: Explore all options for a great college education.
State colleges, community colleges, online university programs and part-time programs all can give your child the opportunity to learn and offer alternative ways to get a quality education that fits your family budget. Some state colleges offer reciprocity programs with other state universities and colleges, so you pay in-state prices for an out of state college. Exchange programs offered at state colleges might allow your student to expand their experience beyond the state school at a lower cost than private college.
Tip #5: Let your child know his/her part in paying for college.
Don’t let your student children “play dumb” about money for college. Get them to understand the investment involved in secondary education. The best plans are often shared with parents and students. It is not simply a parental issue, but a mutual challenge to include the student. The combined effort of parent and child is integral to developing a strategy to navigate the financial labyrinth of college planning.
For more Top 10 Tips, stayed tuned for the second piece in our series. Have any tips you’d like to share based on your experience? We’d love to hear them!
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