5 Points High School Seniors Must Discuss About Paying for College
Frank Discussions Now Can Save a Lot of Grief Later
As fall wears on, parents of high school seniors become more and more concerned about their family’s financial future. They see their child happily applying to colleges, and don’t want to burst that bubble with a reality talk about how the family is going to pay for this education. Many are struggling to make ends meet already, have other children to worry about, or are trying to save money for their own retirement, and paying for some of the colleges under consideration could put a substantial strain on the family’s budget.
As you prepare to sit down and get ready to complete the FAFSA to determine whether your family qualifies for any financial aid, here are five points you must discuss now with you high school senior about paying for college:
- This is what we can realistically afford: Despite your rosy predictions, or what the Expected Family Contribution (EFC) might predict, you first need to sit down and determine what you really can afford to spend on college. Look at your family’s household budget, upcoming college expenses for other siblings, and your retirement needs. Then decide how much you can afford to spend out of your family’s income to support your child’s college plans. If there really isn’t any extra money available right now, you have a lot of talking to do.
- Let’s talk about the colleges you are considering: If you have no idea what colleges your student is considering, you had best get on the same page now. Have your child do some homework and develop a list of the top ten colleges, and then put together estimated costs for each. This general information is usually available on each college’s website, or on the federal government’s College Scorecard. Make sure to add in extra costs such as transportation and books, to get a more realistic estimate. Then compare this information to the family budget, and discuss the differences.
- Will it be worth the money we are spending? If one of the points of attending college is to get an education to get a better job to earn more money, then future employment possibilities must be considered. Look at how many students graduate from each college, how many get jobs, and how much those jobs will pay. If the money won’t be enough to repay any student loans you might need, you will have to discuss your next steps.
- How will we pay for this as a family? Let your child know what your family will be sacrificing to make this dream come true, and let him or her know what their role will be as well. Do not wait until after college graduation to have this discussion. Let your student know how much you will expect him or her to contribute or earn to help pay for college costs, and definitely discuss whose responsibility those student loans will be upon graduation. Some students are quite shocked to find that their parents actually expect them to use their own money to repay their student loans! Make sure you are all aware of how much money is being borrowed, and what the future payment amounts will be.
- Here is what we expect of you: Encourage your student to continue maintaining academic success in high school, and let him or her know you will expect the same in college. You also want your child to search for scholarships that might be able to help defray some of the costs. Finally, you want to work together to develop a budget your student can use once he or she is in college. There is no better time than right now for your child to start learning how to save and spend money properly.
It may not be easy to have this conversation, but it is definitely worth the effort.
Far better to lay things out on the table now than to wait until your student’s first holiday break from college, and find out that you are really in over your heads.