Most people aren’t in a position to provide a $40,000 degree for each of their children. After setting aside money for an emergency fund, life insurance, mortgage payments and the cost of living, that’s okay! As a parent, you’ve got a responsibility to take care of your child – and yourself – financially. After all, you can’t take out a loan for retirement.
Fortunately, you don’t have to pick up the tuition tab to help make college more affordable. In this article, we’ll show you 5 other options.
Help them fill out the FAFSA.
The Free Application for Federal Student Aid opens the door to grants, scholarships and federal student loans (usually the cheapest type). Your income and financial information are needed, so your child will need your help filling it out. Remember, you’ve got until October 31st each year to submit it. You can also help by advising your student to study for the ACT or SAT’s, fill out scholarships and choose an affordable college.
Encourage them to choose a high-paying major.
Few things are more discouraging than graduating with a college degree you aren’t able to use, because you can’t find a job in the industry. That’s why it’s important for your kid to do their research early on. Before declaring a major, they should know the career options available within that field, average starting salaries and the classes that will be needed. A past alumni who obtained that major may have good insight about their experience looking for work after graduation. Additionally, students should intern in their field as a freshman or sophomore. This helps to ensure it’s a good fit and prevent a costly change of major later on. Keep in mind, STEM fields are still some of the best paying majors out there.
Pay for some of the smaller things.
“Should parents help with college costs?” That’s a question we get often, and, in short, the federal government thinks you should. In fact, your student’s Financial Aid Award includes a figure for Expected Family Contribution, or the amount the government thinks you can pay based on the information you provided on the FAFSA. However, how much you contribute and where you choose to help is up to you. Other ideas for expenses you can help with include cell phone bills, car insurance, books and supplies, paying for a summer class, quarters for laundry or stocking your kid’s fridge when you visit. Also, a gift basket full of goodies never goes unappreciated.
Let them live at home.
The average room and board for an undergrad student is more than $10,000 per year at a four-year school. For this reason, if you it works to allow your to student continue living at home, they’ll save a lot of money throughout college. That also means fewer loans needed, and less student loan interest paid. However, if this ins’t an option for your student, teach them to trim their expenses as much as possible by selecting affordable housing (even in the dorms), using their meal plan wisely, buying used textbooks and living modestly. Check out additional tips in the College Cost Calculator download below.
Cosign their college loans.
First, know that cosigning any kind of loan is a major commitment that can affect your credit score and financial goals. Plus, you’re essentially agreeing to repay the loan in the event your child is unable to make their loan payments, or chooses not to. However, if you trust they’ll be responsible in making payments, cosigning a private student loan for them can be a big help. This is because most 18-year olds don’t meet the credit requirements on their own, and if they do, a cosigner may still help them get a better interest rate.
When it’s time to pay for college, don’t forget to check out the iHELP Private Student Loan. Along with great rates and flexible repayment options, you’ll get a single-point of contact who is there to help every step of the way. Payments aren’t required while a student is in school but we do recommend making interest-only payments to lower the overall cost of the loan. If you have questions, feel free to ask us!