Paying for College
Paying for college is a big investment, but you have options to make it more manageable. Understanding your choices can help you create a plan that fits your financial situation and long-term goals. By exploring different ways to fund higher education, you can make informed decisions and move forward with confidence.
Scholarships and Grants
It’s always worth your time to see what scholarships and grants for which you may qualify. The first step is filling out the FAFSA to determine if you’re eligible to receive federal grants, work-study opportunities, student loans and some state and school-based aid. Getting as much free money as you can with grants and scholarships or opting for a work-study program will lower the amount that you will have to pay.
Loan Options
Based on many factors and your FAFSA information, you may be eligible for federal student loans. If you need to borrow for college, always opt for federal loans before private because they offer benefits that private lenders do not including, income-driven repayment plans and loan forgiveness programs. If you still come up short, private loans are your best bet. Find a lender that offers generous borrower protections and the lowest interest rate possible.
Savings Accounts
The earlier you start saving, the better off you’ll be when it’s time for college. Starting an education savings account like a Coverdell Education Savings Account (CESA) when your child is born is the best strategy for growing your savings tax free. You can spend the money on qualified educational expenses like tuition, books and supplies. The money saved with a Coverdell Education Savings Account (CESA) can also be used on K-12 expenses if needed. Another innovative way to pay for college is by using a Roth IRA.
