Preparing Financially for Your Child’s College Education

The What, When and Where of College Expenses

Financing for College: The Sooner the Better

Are you preparing financially for your child’s college education? It’s an exciting time to see them step into their future, but it is also an expensive investment to prepare them for adulthood. Similar to running alongside your child as an example of exercise and endurance at an early age, financing your child’s college education is best strategized by starting early, and by following “the sooner the better” plan. Start with estimating the cost of their education and review the tips on how to prepare for college to calculate your budget. Financial aid and scholarship opportunities can help with your endurance to make college payments, but make sure that you can answer the questions of what, when and where your child will start running on their own so that the transition will go smoothly on the path to college.

The What: What items are going into the budget?

What is the true cost of college and what are the items you will need to budget for? As you begin to prepare for your child’s college experience, begin reviewing the list of various expenses that will come your way. For instance, track tuition, living, transportation, and supplies such as school equipment and books are a part of finishing the race and receiving the college degree. Teaching your children about ‘college cardio’ - how expensive a college degree will be along the way and the importance of scholarship opportunities will contribute to financial health and college planning. If you are expecting your child to contribute to their educational expenses make sure to get on the same page with your soon-to-be college student to ensure your family is ready for what is to come.

The When: When do you start?

When should you start preparing for your child's college expenses? To answer this question, you will need to confirm how you will be paying and how the payments are organized. There are many routes when it comes to financing your child’s education, there are student loan options to consider, savings accounts, financial aid, investment accounts, and even family contributions that all can be part of the discussion and combined to help you reach your goal. As your child continues to grow, have the discussion of their perspective of college, where they are thinking of going and whether it’s in-state or private education. Whether you are paying in part or full for the future costs, discuss the pace at which you will be able to make the contributions, as there is a significant difference of how much you should save for your child’s college education based on your abilities, their growth and how the responsibilities have been distributed.

The Where: Where will college payments be submitted?

If you have decided to take the student loan route, you will need to review the student loan repayment plan. This will help them answer the question of ‘where will college payments be submitted’? As your child grows, begin running at a faster pace with more obstacles and different terrain to help them improve their pace and endurance when faced with complexity. Preparing for college and adulthood has similar changes and challenges that they will want to train for. As a parent taking on college expenses, or if you are co-signing with your child you will want to choose a student loan based on your income so that payments are affordable over time. There are various loan servicers and payment plans to choose from, and you will want to find the best payment plan for your circumstances. After you have chosen your loan servicer, you can use a loan calculator or simulator to help estimate what your monthly payments will be, how long it will take to pay it off, and where the college payments will need to be submitted.

Preparing Your Child for Their Future: A Smooth Transition

While the path to your child’s college degree is an exciting time, financing their college education takes endurance. Preparing them for college is just like running alongside them and encouraging them to improve their pace and endurance. College is likely their most expensive investment and it’s important to be clear of what it takes to cross the finish line to receive their college degree. You will need to build their knowledge of college expenses, research financing options, and answer the questions of what, when, and where your child will start running on their own. For the college transition to go smoothly run at a faster pace with obstacles and challenging terrains to help them improve their pace and endurance when faced with complexity. Financing your child’s college education is best strategized by starting early, and “the sooner the better” to make sure you are on track to finishing the race and receiving the college degree.