How To Pay  For College:  A Family Guide

College education leads to higher income, job security, and great opportunities in life. But, it may take until age 34 for the average bachelor’s degree recipient to fully recoup these costs. Student debt can put a damper on one’s ability to obtain wealth. It pays to plan to save as much as possible ahead of time and lessen the burden, supplementing with more attractive federal loans, scholarships, grants, and work-study programs before tapping higher-cost private loans.

Here are my five recommendations

1. Plan for your child’s college as early as feasibly possible. Get a jump with these six possible ways. 2) Fill out the FAFSA (The Free Application for Federal Student Aid) application. Don’t think of it as an option. 3)Reduce your  Expected Family Contribution (EFC) in legal ways.

Parents may want to consider private loans if they borrow above their contribution through their income and savings. They are not all need-based. 4) Get as much as you can from federal loans for students before private loans. 5) Go for work-study, grants, and scholarship money. Scholarships are merit-based.

Four-year in-state and out-of-state public colleges and private colleges, two-year in-district (community colleges). If you were selecting based on costs, only in-state four-year and two-year colleges are your least expensive options, benefiting from that state’s taxpayers.

2020-2021 College Costs For Tuition and Fees Room & Board:

Average tuition and fees before room & board in 2020-2021 and inclusive of room, board, books, personal expenses are: Four-year in-state college was $10,560, and $26,820. Four-year out-of-state college was $27,020, and $43,280. Four-year private college was $37,650, an $54,880. Two-year public in- district college was $3,770, and $18,550.

If you are borrowing, federal loans are far more attractive but have loan limits by year, with the freshman year maximum loan is the lowest at $5,500 rising to a maximum of $12,500 annually. You can only borrow up to $57,500 for your total college. The government sets these amounts, but the colleges calculate the amount per individual student based on the college’s cost of attendance, so your child may get less than the limit.

Should I complete the FAFSA? Yes, end of story.

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