By Claire Wood
All year, I have been walking through each month and pausing to take note of some of the typical financial rhythms unique to military life. The focus for August is on planning for the monetary cost of college or any vocational training for your children, immediately following high school. As a parent, no matter the stage of life you’re in, these 10 ideas will help you prepare.
We very recently dropped off our son at college for his freshman year. There are a few things I wish I’d known ahead of time and lessons I have learned walking through this process myself. Here’s what I’ve determined about how to plan financially for your child’s educational future:
- At the outset of high school, have a heart-to-heart discussion with your teenagers about their preliminary plans after graduation. Share a basic and brief financial snapshot of any savings or financial help you hope to provide them (if any), and begin a conversation about expectations for how they and you will each contribute. For example, their primary job might be to focus on keeping a high grade point average (GPA) or working a part-time job. Your primary contribution might be to help them search for scholarship opportunities and project-manage the FAFSA process. (More on that later.)
- Students of military parents will often spend time in more than one high school. For this reason, among others, it is important that they (and you as the parent) establish a relationship with their guidance counselors who help manage graduation requirements and credits. This is especially vital if a student changes states during their four years and has different requirements between schools. Counselors also oversee official transcripts and general record-keeping, and many have insight into local opportunities for students regarding scholarships. A good tip is to always ccyour student and have them ccyou with any communication between the student, parent, and guidance counselor.
- Early in high school, encourage your student to get familiar with their school’s programs or courses that offer potential college credit. Dual enrollment, early college programs with local universities, CLEP tests, and Advanced Placement courses could shave off a considerable number of hours that your student won’t have to take (and pay for) during college, just by taking advantage of these free or reduced-cost opportunities in high school. Our son utilized a combination of summer college academic camps, dual enrollment, and AP courses and is beginning college with 22 hours of credit; almost enough to qualify him as a sophomore.
- Sooner, rather than later, get clarity on the ins and outs of your servicemember’s G.I. Bill or educational benefits. There are many requirements and stipulations for accessing the education and training benefits you or your children may be entitled to receiving. The U.S. Department of Veterans Affairs (VA) website has many helpful links to get you started on learning more about how the G.I. Bill works, eligibility requirements and how to apply, among other topics.
- By your student’s junior year, he or she should be focusing on taking any college admissions tests, such as the ACT or SAT. Through MilitaryOneSource, military-connected students have free access to a Tutor.com account where they may find some helpful preparation for these tests. Sometimes it’s only a matter of a few points’ difference between being scholarship-eligible and not. Additionally, by junior year, students should be compiling a list of schools based on interest, location, cost, and eligibility. Some experts recommend targeting two dream schools, two target schools, and two safe schools. With a specific list of colleges started, families can begin plugging in the cost and what it would take to cover the school bill, including tuition, room and board, and other fees.
- By the time junior year wraps up, you and your student should have a good idea of colleges that are serious contenders. You should have a full understanding of what types of scholarships (both merit- and needs-based) the school offers, any minimum GPA or ACT/SAT score requirements, and whether the school offers any special aid to military-connected students via ROTC programs or the Yellow Ribbon program. Going into the senior year, students may begin the application process. Most schools charge a fee to apply, so only consider doing so to colleges that your students are actually, truly, seriously considering.
- In early October of your student’s senior year, the Free Application for Federal Student Aid (FAFSA) opens up for seniors to complete going into their final year of high school and in preparation for the admissions and financial aid process to begin for college. This is where students and/or parents will complete an application and offer a full financial snapshot of their family’s income and prove what degree of financial need they qualify for for federal student loans. Even if your student does not plan to take out federal student loans, most colleges require that students complete the FAFSA in order to partake of the university or college’s scholarship offerings, even if the scholarships are merit-based and not needs-based. You must have recent federal income tax returns handy in order to complete the FAFSA, as well as an idea of your monetary assets. These are used to help calculate a “magic number” called the Expected Family Contribution, or EFC, an index number used to determine a student’s eligibility for federal student aid. The FAFSA can feel a little intimidating and overwhelming. Most high school guidance counselors have experience navigating this system and would be happy to walk parents through it. The common advice is to get the FAFSA completed early, as many colleges allow for Early Decision or early admissions in the fall of the senior year. Many institutional scholarships have deadlines in February of the senior year and are awarded and distributed before graduation. The old adage, “The early bird gets the worm,” can be true for those seeking scholarship money in addition to other sources of funding, such as state lottery money, federal aid, or the G.I. Bill.
- Another way to help fund your student’s college expenses is to have your child complete scholarship applications for local scholarships. Just this past year, our son filled out paperwork for four local scholarships. Most applications required an updated official transcript, teacher letters of recommendation, an essay, and in my son’s case, a video submission. He received only two of the four he applied for, but one was a $5,000 gift and the other $2,500. These scholarships are good as one-time disbursements that are applied directly to his college for his freshman year only. However, the return on investment of the few hours it took him to complete these applications and submit them was huge in comparison to the dollar amounts awarded. We estimated about ten total hours of work for $7,500. Again the guidance counselor is a good point of contact to funnel many local opportunities to graduating seniors. These, in our experience, were far more attainable and realistic than trying to wade through national scholarship search engines.
- Speaking of work and part-time jobs, don’t underestimate the value of your student looking into the Federal Work Study program as a way to help offset the costs associated with college. This is an offshoot of the FAFSA and closely tied in, but schools that participate will hire students to work a set number of hours on campus in exchange for a paycheck that can then be applied to the school bill, used for books, for living expenses, or paid directly to the student. In addition to the financial help a job can offer, students working toward a goal presents a wonderful opportunity for their own buy-in for college.
- Finally, if you have younger children and more time to invest in advance of their high school years, one of the best ways to save up and fund their educational experience is through one of a few investment options. A 529 Plan run by your state can offer tax advantages and provide favorable financial outcomes if you start investing early. Additionally, the UGMA/UTMA (Uniform Gifts to Minors Act/Uniform Transfer to Minors Act) act as trust-type accounts where the parent or guardian acts as a custodian over the funds until the child is ready to apply them to educational expenses.
College for our military-connected kids is an exciting time, especially when you consider some of the many sacrifices they have made over their K-12 years in the name of duty and service. With careful planning and a smart strategy, paying for college can be less stressful and more enjoyable for both you and your student.