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I’ve always thought about starting a college fund. I even opened a small savings account when he was born. Now they’re in high school, time is running out and I’m starting to panic. What can I do? Where should I start? Are they going to hate me? I really wish that I had started earlier.
get started: As their guidance counselors, teachers, and friends are helping them evaluate their strengths and weaknesses in an effort to narrow down their career options, you need to take action now if they’re going to make it to college. . Here’s how to get started.
relax: Your first step is to take a deep breath and realize that you are starting late. You cannot change the past, but you can take positive steps to change the future. The fact that you are reading this article tells me that you are prepared to try to help your kids as much as possible. It will take some time and effort on your part, but you will move forward one step at a time.
follow these steps: The following steps will help you get started on a well-structured path. You will embark on a journey that will take you from where you are now, to your youngest child’s college graduation. It won’t be easy or without some sacrifices, but if you do it right, it will be fun and your kids will appreciate your efforts.
step 1 – Family Net Worth: Create a current net worth statement so you can see where you stand now. It is a financial snap shot that will show your assets and liabilities as of today. (You can find a one-page net worth statement for free on our site listed at the end of this article – Forms section – or by searching the Internet.) Once you know where you are today, every positive step you take will improve your net worth and aid your efforts to send your children to college.
step 2 – Maximum Income: Now that all your kids are in school, consider maximizing your earning and savings potential. If one spouse was the primary caregiver for the children, they were probably working part-time or not working outside the home. Consider having both spouses work full time to add extra income to the family budget. These increased earnings can be directed specifically into college savings, but make sure you put them in the right types of accounts.
Step 3 – Talk to your kids: Discuss college and financial aid with your kids now. Review the costs associated with community colleges, state universities, and private colleges. Let them know that you may be late to the game, but you are trying to help them as much as possible. Based on your family size, income and assets, you can use an online EFC calculator to get an estimate of your expected family contribution. Once you and your children are aware of these estimates, you can begin looking for your best college options.
Step 4 – Let Them Help: Finally, encourage and help your children become more “financial aid eligible” students. By doing the right things and setting up your assets properly while you’re in high school, you can help them by qualifying for more financial aid and learning how to further reduce college costs.
keep moving forward: The most important point to remember is that even small steps will help, so if hitting a college financial “home run” isn’t possible, even a solid single or bunt will help your cause. Every little bit helps and if you keep going in your efforts to close the college funding gap, your kids will see your efforts and be better off.
Summary: do not beat yourself up. You are in the same boat as many other American families. Your kids won’t hate you, but taking the first step now will go a long way. Talk to your kids and give them realistic expectations about what you can and can’t do to help. Remember – where there is a will… there is a way.
With so many college options, students need to evaluate their situation and decide which path is right for them. It will be easier if they know all the relevant details. They might surprise you, so encourage them and help them make good decisions.
To find very specific ways to maximize your financial aid and reduce college costs, I’ve prepared a Free College Cost Savings Kit that you can download click here,
Please consider printing this article and sharing it with a friend. Many parents are in a position similar to yours. By paying it up front, you can help save them a lot of headache and a lot of money.
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