College SOTU (State of the Union)
One week left of the third quarter means a busy week of tests/projects and the anticipation of Spring Break for our family. For those of us with high school-aged children, this time of year also means picking classes for next year and getting gussied up for college admissions boards.
It is a struggle to balance staying present in our week-to-week responsibilities while also having the foresight to plan for our children’s future selves.
There are (lots of) times when a brief conversation about college planning jumps the rails because the more pressing matter is managing the five tests scheduled this week.
As our youngest finishes her junior year of high school and dives headfirst into considering her post-high school options, I’ll focus on college (financial) planning for the next few weeks (this time with the hindsight of launching her sister two years ago).
College Planning Near Rocks
This year will fly by, and how we budget our energy will greatly impact stress management. Staying organized and keeping the family tachometer out of the red is a delicate mission most weeks.
There was a time I couldn’t imagine saying this, but budgeting for and investing in an educational consultant has been a game changer. Trusting an expert who understands the college planning process and can guide our child through the exploration necessary to find a good fit has greatly reduced the stress level in our home. It also provides another trusted adult voice that gets permission to speak into our teenager’s life—not an easy feat.
We’ve learned that college shouldn’t necessarily be a “perfect fit.” A “good enough” fit where young adults can grow and continue to assess options is a great lily pad for finding a professional career path.
The landscape of college admissions has changed in recent years. It used to be that if you had stellar grades and a great SAT/ACT, you should be able to get into your state’s flagship public universities. Change 1: Many public universities have rejection rates close to the near-Ivy’s. The statistics say college enrollment is down, yet the opportunity to get into many colleges seems to be down even further. This phenomenon seems even worse in states with generous scholarship programs like Florida’s Bright Futures.
The FAFSA and the CSS Profile are yet another black box of the college machine that we’d like to skip this time around. The delay in the 2024-2025 FAFSA is a chocolate mess, but even in a good year, the FAFSA doesn’t do much for families with higher incomes. Yet most schools still require it.
Student loans are another merge to sort. Some families find value in a new adult putting skin in the game by contributing to college funding. Others fear that debt can stifle opportunity in one’s twenties. Either way, it’s important to arm yourself with a basic understanding of the types of student loans:
- Federally subsidized (Direct Subsidized): Uncle Sam pays the interest until you graduate.
- Federal, but unsubsidized (Direct Unsubsidized): Interest accrues from day one.
- Loans to parents (PLUS): Parents are on the hook. These are not subsidized.
- Private: No government backing, and also not eligible for any of the income-driven repayment or forgiveness programs.
Loan programs may require co-signers. This should not be undertaken lightly as loan infidelity can wreck relationships.
529 Distributions vs. the GI Bill, Yellow Ribbon, and other scholarships: When a family has access to both a 529 and the GI Bill, the homework is just beginning. Financial aid offices at each school will have a different methodology for integrating the GI Bill and other funding sources. Getting the plan in writing is vital so no one faces shock and awe at check-writing time.
Cleared to Rejoin
If you’re turning base to final for the college admissions process, lock down your shoulder harness—it can be a bumpy ride. Stay tuned in the coming weeks for more gouge on getting your kiddos off to college and eventually off the payroll!
Fight’s On!
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