People in general wait until the absolute last minute to do everything.
That’s why very few people end up financially prepared to pay for weddings, homes, retirement, and college educations for their children.
Here are three little-known reasons why you should start planning for your child’s college education in their junior year of high school (if not earlier).
Reason one: Money saved in the wrong places could cost you a fortune in lost financial aid.
Did you know that money saved in the wrong places could cost you thousands in financial aid? It is important that you determine which assets you have accumulated in the “wrong” places so you can either gift transfer or reposition them before you have to apply for financial aid. If you wait until the last minute to do this (your child’s senior year), it will be too late to change your financial picture and you will lose out.
Reason two: You must know how much your family will be expected to contribute towards college costs.
No matter which schools your child ends up applying to, the government will expect you to pay your fair share towards the cost of college. Known as the “Expected Family Contribution”, it is the minimum any school will expect you to pay towards your child’s education. Waiting until your child’s senior year will leave no time to do any saving – and this means borrowing more money to cover the cost.
Reason three: You want to choose schools based on the schools’ ability to give you money.
Most families pick schools whimsically without giving any consideration to which schools have the best ability to meet their financial needs. Typically, students start picking schools towards the end of their junior year, visit them during the summer, and then start applying to them in their senior year of high school.
The entire process is very costly between travel and application expenses and most students and parents are stunned at the end of their senior year when they find out there is no way they can afford most of the schools they applied to!
This scenario can easily be avoided by finding out which schools have the best histories of giving good financial aid packages – more free money, less loans!
If you want to learn how to get your child into the college of their choice without using all your savings or sacrificing your retirement, attend one of our free workshops in Santa Clarita or San Fernando Valley.
Brian Safdari is a Certified College Planner with offices located at 28494 Westinghouse Place, Suite 206 in Valencia. For more information, please call 661-295-9946 or visit www.collegeplanningexperts.com for a free consultation.