Financial Fitness Friday: College
Hi! I’m Ashley, Financial Education Coordinator for Credit Union 1! Check out my blog every Friday for fun tips and tricks to help you manage your finances. Uffda, higher education costs seem to be rising by the minute! One of my younger brothers is currently in college and my little sister will be a college freshman in the fall and boy do they have some doozies when it comes to college costs! Neither of them have a college savings account and they are paying for it through loans so let’s take a second to look at different ways to pay, save or plan for higher education.
Whether you’re planning to pay for your own college education or your child’s, it is important to have a plan and start early. Most of us here in Alaska get the PFD so this is a good place to find extra cash to save. There are programs like the UA College Savings Plan for PFDs that will guide you step by step to put away some or all of your (or your child’s) PFD for higher education. Since my siblings and I haven’t lived in Alaska all our lives – PFD’s weren’t around for us to save but it’s definitely something I’ll look into for my future children!
Maybe saving the PFD just isn’t in the cards for you – that’s ok! There are a few other ways you can save like doing a Coverdell Education Savings Account (CU1 offers this) or a 529 college savings plan. Both of these may have tax benefits so check with your tax advisor to see which one will work best for you!
Let’s say you’ve decided to enroll in college and do not have savings yet, so loans are your plan for now. That’s OK! However, you can definitely bring down the amount of money you borrow by applying for grants and scholarships. There are so many scholarships out there that are up for grabs; you just need to look for them. For instance, did you know CU1 offers college scholarships? So before you take out a hefty loan, spend some time applying for grants and scholarships to bring down your overall costs. A few hours of your time could really be worth it! If you’re going to go the loan route – make sure the rate is low. Sally Mae is a good place to get student loans and we can help you with that too. Remember, you don’t have to take the first loan that’s offered to you so shop around for the best rate to save the most money.
Next, make a budget. We’ve talked about these before so I’m not going to preach budgeting to you – just make sure you’re living within your means. Sometimes this may require you to take on a part time job while you’re in school or shut off the cable. Sacrifices now will equal a healthier financial future!
How do you plan on saving for higher education costs for you or a loved one? Do you have any other tips or tricks to keep the costs low? Share them in the comments below!