Fall is in the air, football season is in full swing and not surprisingly, the Patriots are again one of the top teams in the NFL. We know that football Sundays are sacred to many families here in the northeast, but if your child is currently a junior in high school, it is crucial to take some time away from your couch this weekend to make a game plan of your own, this one about planning for college for your child.
For those in attendance at our most recent seminar on Paying for College last month, we stressed the importance of having “the college money talk with your child” while they are a junior in high school. We know the difficulties of getting your child to voice their interests, let alone participate in a family dinner. Yet, this is the most crucial phase of the college process.
Where do you begin? It’s best to start the conversation with your student determining interests to look at possibilities for a college major. Even if a proposed major cannot be determined, just getting a general idea can eliminate some schools from the wide range of possibilities.
Next, you need to look into the finances. Your child needs to know how much you have saved and what they will be responsible for. We like to use the example of buying a house as a comparison. We know the importance of calculating the monthly payment on a mortgage before buying a house, but for some reason many families do not consider loans when paying for college in the same way. As such, students can end up trapped in large amounts of debt and be unable to afford monthly payments after graduation.
It is important to calculate what the student’s monthly payment will be after graduating from that $70,000 school to get a better sense of their affordable price range. For many high school children, they do not know exactly how a loan works, so this is a great time to explain the details (and also explain how difficult it would be to pay a $1000 monthly payment coming out of school).
The fall of your child’s junior year is the prime time to have this game plan talk with your child, so that they know what to expect before visiting schools. Therefore instead of commenting on the beautiful campus or gorgeous dorms, your child should consider the costs associated with each college. From here, they can make a more financially responsible decision when considering options to apply during their senior year.
Do you have any other questions on making the college game plan with your child? Give us a call, we’re here to help!
All the best,
Financial Planning Solutions, LLC (FPS) is a Registered Investment Advisor. Financial Planning Solutions, LLC (FPS) provides this blog for informational and educational purposes only. Nothing in this blog should be considered investment, tax, or legal advice. FPS only renders personalized advice to each client. Information herein includes opinions and source information that is believed to be reliable. However, such information may not be independently verified by FPS. Please see important disclosures link at the bottom of this page.