Savings
As with all big expenses, the best way to prepare for it is to plan ahead and save in advance. A 529 college savings plan is a special type of savings account that is specifically designed to cover the costs of tuition, books, room, board, and other college-related expenses. In some states, parents with a 529 plan qualify for an income tax deduction or credit on the contributions they make to the account.
Scholarships
Scholarships are gifts awarded based on merit or need. Unlike loans, a scholarship is a gift of "free money" that will not need to be repaid. There are countless different types of scholarships available. Academic scholarships, athletic scholarships, and cultural scholarships are commonly offered by college institutions. Third-party organizations and countless online sources also commonly offer scholarships. A high school counselor or the financial aid office in a university are good places to begin the hunt for scholarships.
Grants
Federal grants (also commonly called "financial aid") is another potential way to offset the costs of funding your child's education. These grants are needs-based and, as such, do not require repayment. Students must fill out the FAFSA (Free Application for Federal Student Aid) in order to be considered. Federal student loans may also be available for qualifying students.
Work-Study Programs
Most universities offer a host of on-campus job opportunities for students that are part of a work-study program. Many of these programs are needs-based (qualification will be determined after the student submits the FAFSA), but most colleges offer a few additional positions that may be filled by any student, regardless of household income. These programs are generally an ideal way for students to offset the cost of tuition and to earn a little extra spending money. Students can generally get positions in the department of their chosen degree, which helps strengthen their resumes.
Student Loans
Funding college without going into debt is obviously the most attractive option, but in some cases, it may not be feasible. While you can combine the other strategies we have discussed so far to cover many of your expenses, student loans are always available if you need to fill in the gaps. Many families use student loans to cover approximately 20% of the total cost of their children's education. Federal student loans often offer cheaper interest rates than private loans, so it is best to start your search there.
Reducing Costs
Finally, one of the best ways to afford a big expense is to lower the price tag. Some universities are more expensive than others, so if money is a concern, it may be in your best interests to look at schools that fit more easily into your budget. You can also reduce costs by encouraging your children to earn some credits as part of a dual enrollment program or at a two-year community college, as these options are often significantly more affordable than traditional four-year institutions. Your children can then transfer to their chosen institution to complete their degrees.
Good Luck!
On behalf of everyone at our Lake of the Ozarks bank, we wish you the best of luck on this worthy endeavor. A college education will serve your children for years to come, so it is wise to begin preparing well in advance. If you would like to learn about our savings accounts at the Lake of the Ozarks or other investment options (such as CDs), visit our website at www.FirstBankLake.com.
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First Bank of the Lake - Striving For Excellence
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4558 Osage Beach Parkway
Suite 100
Osage Beach, MO 65065
4558 Osage Beach Parkway
Suite 100
Osage Beach, MO 65065
(573) 348-2265
