Parents often are faced with the conflicting goals of helping their children with college expenses and saving for their own retirements. John McDonough, CEO of Studemont Group College Funding Solutions, and former U.S. Secretary of Education William Bennett, who has written “Is College Worth It?” have advice for parents to help with the balancing act:
>> Consider the return on investment of a college education. College graduates on average earn 84 percent more than those with only a high school diploma, according to Georgetown’s Center on Education and the Workforce. But it’s worth weighing tuition costs relative to a specific career’s lifetime earning potential and considering alternatives. Bennett discourages all but the wealthiest or most talented from majoring in the arts or humanities, subjects with lower employability ratios.
>> Move retirement assets to qualify for grants. Most parents know about the 529 savings account, but that’s not necessarily the best or only option. Reallocating assets into sheltered categories can better position a child to qualify for grants and scholarships. This legal and ethical maneuvering may be the single most important factor when considering how to pay for college.
>> Know your student’s strengths and weaknesses. Consider independent and objective analysis of your future college student. Assessment might include a personality profile and a detailed search for a future career. Also think about a more nuts-and-bolts approach, including scholarship eligibility, SAT and ACT prep courses, review of admissions essays and an analysis of chances for enrollment in a student’s top choices of colleges.
>> Make a checklist of financial aid forms. In order to maximize a fair price of higher education, remember there is plenty of data to review. McDonough recommends a checklist with deadlines. Be ready to troubleshoot the “alphabet soup” of data forms: FAFSA (Free Application for Federal Student Aid); CSS profile (College Scholarship Service); and more. Think about this process as a second job, or find professional help you can trust.