Sunday, November 23, 2014

Six Ways to Send Your Kid to College!

  1. Start saving something when your kid is born
Ok, maybe not when they're exactly born 'cause I know you need money for diapers, bottles, and such, but decide on an amount that is realistic for your family. Let's say you start saving when your kid is 2. Putting away $20 a paycheck for example can add up over the next 15 years.  Yes, I'm calculating when the kid is 17 because what happens during junior year - uhhh, something called SAT tests with possible SAT prep classes that aren't free! You may also want to start touring some local and not-so-near colleges, that's gas and lodging to think about too.

     2. Put your money somewhere where you won't see it
Sure, put it in a 529, but a 529 has some restrictions. I had one for one of my kids, but you know what worked better? My Roth IRA and stock accounts.  As long as I only took out what I contributed and didn't touch the earnings, my taxes were ok.  Whatever you choose, be disciplined about contributing regularly and not touching it until your kid is 17!!

      3. Establish a college-going culture
Wherever we went for a family event, vacation, a road trip somewhere, we always included at least a drive through of the local university.  By the time my kids were 8 and 10, they saw over half of the UC schools and quite a few of the CSU campuses, plus many private institutions.  We would walk the campus even if only for a half hour or so and always stopped by the student store to pick up a t-shirt.  I looked at the souvenir as a way of reinforcing in my kids that they were going to college one day.

    4. Fuel your kids' passion
Does your kid love something in particular and they're good at it?  Let 'em go at it! As an application reader for a local university, the kids who stand out to me are those that pursued their passion.  Your kid wants to start a catering business,? Let 'em! Your kid wants to fund raise for those affected by Typhoon Yolanda? Help 'em! Your kid wants to break a Guinness Record for most days without sleeping? Get some snacks and activities together and cheer them on!  It's our job as parents to expose them to all sorts of experiences and support them!  These are the kinds of things they can write about in their personal statements that will get a university reader's attention and get them into their top choice school!

   5. What, a scholarship for being a twin? Yes, money is out there! 

All you have to do is research and of course apply. They have scholarships for all sorts of people, twin, South Paw, wants to be a farmer, wants to design cars, everything!!!  The applications (and sometimes interviews) can be a lengthy process, but hey it's a paycheck at the end of the rainbow. Scholarships are offered to students as early as sophomore year, so it doesn't hurt to start hunting early.  Once students have a  well written essay, they can tweak it to fit the topic if the scholarship requires an essay.  Popular topics are tell us about yourself, or tell us about a time you were challenged and overcame it, etc...Gauge whether the scholarship is a very competitive one (i.e. only one in the nation given) or one that you really have a chance at (i.e. 20 scholarships will be given...)  As the money purse holder, I helped my girls with these.  I had a spreadsheet of the scholarships they were eligible for, when the application would be available (many are now strictly done online) and also the deadline and notification dates and copies of each application all in a binder.  For big name scholarships I would send the applications by certified mail.  Both my girls won over $20K their senior years, which certainly helped to defray college costs. Some scholarships were also good for four years!!

6. A loan is ok! Really it is!

Even after saving for years, applying for scholarships, and financial aid, with the rising cost of tuition, room and board, electronic devices, etc... there's always going to be a gap with what you have and what your kids need.  Having your child take out their first loan can be scary, but really it is okay.  I think of a college education as an investment into their future.  We all know a college degree doesn't guarantee anything, but there's evidence that folks with a degree make as much as four times more than those that don't.  My oldest has had to take loans to meet college costs, and I'm sure my second one will have to as well, but once they start working, it'll feel good to pay that off.  They give you ten years on average to pay it off. A student loan will help build credit and rates right now are at their lowest in history.  I took a loan out for my master's degree, and since I became a math teacher, my loan was forgiven! How 'bout that!

I hope these six tips help you plan for your kid's future college career! 
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