This is probably the most intensive short-term cash drain on any
family's finances. Unlike most other big- ticket items, such as
homes or automobiles, that can be paid off in monthly
installments, college tuition must be paid out over a relatively
short period of time. With tuition at staggeringly high levels
throughout the nation, a family's commitment to provide higher
education for children can be overwhelming.
Ideally, a long-term plan for college education was initiated
from the birth date of your college-bound student. There is no
better way to ensure a child's education that a systematic
savings plan. But this is not an ideal world, many of us must
finance part of the college education out of the monthly family
budget.
Before selecting a college, parents need to: Determine how much
funding can be available from conventional sources such as
savings, income from the family budget, trusts, and part-time
jobs, if more money is needed.
Explore the availability of scholarships, low-interest student
and parent loans, second mortgages, and conventional loans.
Examine their own life insurance policies and retirement
programs to ensure that college funds will be available in the
event of their death.
Cost is not the only factor to be considered when selecting a
college. While private colleges are generally more expensive
than public colleges, they often have a wealth of financial aid
programs that will make the tuition bite less severe. Many state
and community colleges also have scholarships and loans
available.
Libraries and bookstores carry many excellent college guides
that give detailed information on individual college tuition
charges academic programs. Keep in mind that most colleges have
a financial aid office to assist students in determining when
financial assistance may be available.
Tuition and associated fees increase by 6% each year (or more!)
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