How To Pay For College: A Family Guide

You got into your college of choice. How to pay for college? The latest student loan statistics reflect $1.56 trillion held by 43.2 million student borrowers by an average of $39,351.

College education leads to higher income, job security, and great opportunities in life. But, it may take until age 34 for you to fully pay for college.

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. 4) Get as much as you can from federal loans for students before private loans. 5) Go for work-study, grants, and scholarship money.

In filling out the FAFSA application, the government expects you to divulge your financial situation. They look at your family’s finances, specifically: 1. Taxed and untaxed income from two previous years. 2. Assets.

What The Federal Government Looks At

3. Received benefits like unemployment, social security, bonuses, and severance payments. 4. Family size 5. And what other family members are attending college in that academic year to calculate Expected Family Contribution (EFC).

There are several federally sponsored loan programs for undergraduate students:

1. Stafford Loans 2. Direct Subsidized Loans 3. The Unsubsidized Loans 4. Direct PLUS 5. Income-Driven Repayments

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