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How Parents Can Borrow Wisely To Fill The Gap In College Costs

Your child has chosen a college and signed up for first-year orientation. The next step is to pay the tuition bill.

A survey by College Ave Student Loans found that 74% of the parents they talked to were surprised by how much college costs. Even with the help of scholarships and grants, many families don’t have enough money to pay for tuition, room and board, and other costs.

If you’re worried about how you’ll pay for your child’s college education, here are some ways to get the money you need before they start school this fall.

When savings aren’t enough

The survey found that 95% of parents are helping their child pay for college or have plans to do so. How are they going to pay for it? About 59% plan to use their income and savings to help pay for some of the costs left over after grants and scholarships.

Some people (43% of them) will use 529 college savings accounts to help pay for college, but with tuition and room and board costs going up, many families still don’t have enough. Some parents want to get a second job, and others are thinking about taking money out of their retirement fund or expecting their child to help pay for it.

How to quickly make up the difference in money

Even though it’s great that parents want to help their kids, they don’t have to give up their own futures to do so. One of the easiest ways to cover the gap in college funding right away is to take out a loan that helps pay for college. It can be hard to save for retirement and pay for college at the same time, but you can balance these two needs by borrowing wisely.

You may have avoided loans in the past because you were afraid you or your child would get into debt. However, many loans have more than one way to pay them back.

Mark Kantrowitz, an expert on money, said, “Applying for a student loan can be scary, but it doesn’t have to be hard.” “Student loans are a way for parents to help their kids have a good life in the future.”

Your family should have finished filling out the Free Application for Federal Student Aid by now (FAFSA). If you do this, your student will be considered for scholarships and grants, and they will also be able to get low-interest federal student loans in their own name. If you need to borrow money, you should first look into federal student loans in the name of the student. These loans come with benefits and protections that private lenders don’t offer.

If you still need to make up the difference, you could look into private student loans. Before you help your child get a private loan, do some research and figure out what’s best for your family. A student loan calculator can help you figure out how much the loan will cost and how much you might have to pay each month so that you can find a plan that works for your finances.

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