Tuition prices are astronomical and show no signs of coming down. Even if you’ve been saving for a long time so your child can attend college, it could still be a struggle to make ends meet. Paying for your student’s college is a financial burden, but there are some ways to lighten the load.
Experience saves you loads of money when it comes to college expenses. A parent who has already seen children through college will know where to look to save money. With that in mind, Freedom Debt Relief put together this guide to help you minimize costs.
Federal Loans and Grants
When it comes to federal loans and grants, Freedom Debt Relief advises you to leave no stone unturned. Any student applying for loans and grants must complete a Free Application for Federal Student Aid (FAFSA) each year in college. FAFSA is used by schools for information in their decisions on other areas of financial aid as well. This means that even if you don’t think your student qualifies for federal loans or grants, it is still beneficial to complete and turn in FAFSA before the deadline. Deadlines can be found here.
Federal loans and grants are not the only way to get help paying for college. Many college or affiliation sites give out scholarships. Don’t hesitate to talk to church organizations, police departments, or veteran groups when looking for help. Apply for aid or low-cost loans even if you don’t think your student will qualify. Banks don’t count certain assets in their calculation which could work to your favor. The only way to know is to apply.
Take advantage of your IRA. A withdrawal from a qualified education account or IRA to pay for an expense made in the year the expense is incurred is tax-free. Be careful to ensure that the expense was incurred in the year that you make your withdrawal. Otherwise, you could end up paying penalties.
Educate Your Child
A great way to save money is to get your child on board with saving. A college-age student is old enough to understand college is a huge expense. If your child uses credit cards, talk with them about how to use them responsibly. Create a budget with them that covers everything including entertainment costs.
Freedom Debt Relief has seen many college students who don’t understand the impact of high-interest debt. Talk to your child about the importance of paying a credit bill off in full each month. Getting buy-in from your student ensures more responsible spending.
Freedom Debt Relief knows there are many ways to save money while at college. Encourage your child to get a side job to pay for any wants they may have as well as to pitch in on essential supplies. Always shop for used books rather than buying brand new. If your child’s room has a kitchen, shop around for a lighter meal plan and teach them to cook.
Being proactive can save you a lot of money when it comes to medical costs. Your child is likely to be sick at some point during their college tenure. Don’t wait to figure out how to handle a medical situation until an emergency arises. Find out where in-network doctors are near campus.
Be sure your dependent saves any receipts related to medical expenses. Some medical expenses are eligible to be refunded through a Flexible Spending Account or they may be tax deductible.
Freedom Debt Relief knows college can be a significant financial burden. While experience is the best teacher for how to cut costs during college, try to learn from the experience of others. Sending your child off to college without reviewing your expectations for their spending is a recipe for problems. The right long-term savings plan combined with cutting costs will ensure your child gets a great education.