Example - College Ed Xpress monthly e-newsletter.
Do you have children that are college-bound high school juniors or seniors?
Date: May, 2016
I have yet to meet a parent who was happy with the price they have to pay for their child's college education. So I'm going to demonstrate how you can instantly identify $20,000 for college without causing any major lifestyle changes.
Most parents had to make significant sacrifices for the benefit of their children. That doesn't end when you send them off to college. By the time we reach our forties, we kind of "get it" that buying stuff isn't the key to making us happier people. Keeping that in mind there's still time to forge a strategy that can reduce the strain of meeting college costs.
The first thing to do is painless. Most parents qualify for the educational tax credits, which will put $2,500 per year into your college checkbook. The second is so obvious that I hesitate even mentioning it. The expenses of raising a child are simply carried over to the college years. A conservative amount is $4,000. Combine the two and right off the bat you've come up with 6,500!
The next requires a little work but not on your part. If your teen works this summer keeps $1,000 to pay for books, so you're up to $7,500. The next few suggestions ask for a few minor lifestyle adjustments.
Make a call to your insurance agent, your cable, internet and cell phone provider. Downgrade some of the services you know you can live without. Considering all of the choices available with which we can entertain ourselves, you can save $1,500 per year using only what you need. Why not ditch the cable bill entirely by hooking up an Amazon Fire TV Stick? Ka-Ching! $12,000!
Now for the tricky part. If you can commit $250 from your monthly income you will have $15,000 for college. Start with a lower amount and work your way up. It's amazing how many things we buy without thinking or for perceived convenience. Surely, there must be some food markets within driving distance that offer off-brands for very good prices? Do you have an Aldi's or similar store nearby? If you do you'll find many of your favorite food items (and some brand names, too) for almost half of what you pay at your typical grocery store. Make the effort. It's no hardship. Perhaps a little inconvenient but the money you'll save is more than likely worth it. You can routinely save as much as $400 per month. Remember, you're not only doing this for your kids but for your retirement, too! Depending on your lifestyle and desire to make these sacrifices, family vacations could be downsized, too.
If you can see yourself camping at a nearby state or national park it just might save you more than money; it could help bring your family closer. Go ahead and roll the calendar back 20 years. Fewer devices = fewer distractions. Even if you just scale it back a bit you now have over $20,000 for college.Wow! That's almost $80,000 over four years. You can do it if you want.
Lastly, if it's appropriate, consider consolidating some debt by refinancing your home. Visit Feed the Pig for more ideas.
There are some additional things you should know. For instance, does the college practice what is known as Need-Aware or Need-Blind admissions? Need-Aware means that when the college gets to its last applicants and the choice is between two students who are academically equal, the one who needs aid will not get the aid. This is what's known as Admit/Deny. The student is admitted but the college will be unaffordable which is the same as being rejected.
State (public) universities and a few of the wealthiest colleges and universities are Need-Blind. That is, they don't consider a student's financial need as part of the admissions process.
"The estimate provided using this net price calculator does not represent a final determination, or actual award, of financial assistance. The price of attendance and financial aid availability may change. This estimate shall not be binding on the Secretary of Education, this institution of higher education or the State in which this institution of higher education is located."
More questions: Will they meet your full financial need? Is their financial aid based solely on the FAFSA formula? If the college also uses the CSS/Profile, how closely do they follow that formula? Will they count the equity in your home? How much of financial aid is in the form of scholarships and grants (free money) and how much is going to be loans and work-study? Do they front-load the first year? In other words, will they decrease financial aid in the second year? You may not get answers to all your questions. But to the extent that you do, you'll have to decide if you can live with their aid policies.
Finally, ask them about all of the forms and other requirements you will have to fulfill. It's crucial you know with whom they will communicate: You or your student? Knowing the what, when, whom and how it all works at each and every college will help make a very difficult process at least understandable (hopefully).
This October first, the Free Application for Federal Student Aid or FAFSA and the CSS/Profile are both available to apply for financial aid. Both forms will use the parents 2015 tax return information. For families where the parents are separated or divorced, it's important to decide before then which parent is going to be the custodial parent. Normally it's the custodial parents' income and assets that will be reported on the financial aid forms. The definition of a custodial parent is the one whom the student lives with for at least 181 days of the year or provides the majority of their support. In cases where the custodial parent makes more than the non-custodial parent, it may make sense to have that parent complete the forms. One of the new questions is: Which parent provided most of your housing, clothing, food, and other support during the past year? To make sure all of your information is consistent this should be thoroughly discussed with a qualified college-planning specialist.
Until next month...
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