How much will a college education cost?
The cost of education will vary by school and location. The College Navigator tool on the National Center for Education Statistics’ website provides current costs for specific schools. It is also important to compare the Net Price of colleges as described in the video below. Just one of the many online calculators for estimating the cost of college several years into the future can be found on SavingForCollege.com.
How much can I afford to save?
Managing your household budget today may help you find the cash needed to make tomorrow’s dream of higher education come true.
How do I choose the right savings vehicle for me?
There are tax-advantaged savings vehicles, such as 529 Plans and Coverdell Education Savings Accounts (ESAs). There are custodial accounts, such as Uniform Transfers to Minors Act (UTMAs) and Uniform Gifts to Minors Act (UGMAs.) These articles explain the differences, advantages and disadvantages of each of these vehicles.
What are alternative savings options?
IRAs and loans from a 401(k), or similar employer-sponsored plan, could be used toward education funding. There are advantages and disadvantages to consider. Using retirement assets to fund education goals may or may not be the best option, though, as it may affect the ability to retire. Participants of the United Methodist Personal Investment Plan can further evaluate the loan process by reading this article. Other potential funding sources include cash value in a life insurance policy and annuities. Ernst & Young Financial Planners are available to Wespath participants on a free and unlimited basis to provide advice and to evaluate which alternatives may work best for your financial situation.
Where do I look for financial aid?
Three common steps towards obtaining financial aid include submitting the FAFSA, inquiring at the college, and applying for private scholarships. These are forms of financial aid that do not have to be paid back.
Student loans are more costly and will have to be paid back. But they often fill the gap left by financial aid and reducing the costs of college.
What other creative steps can I take to afford a college education?
Even with planning and saving, college costs can be a barrier to achieving one’s goals. In addition to careful selection of a lower priced college and budgeting well during the college years, consider these options that can actually lower the price of higher education.