College Planning Basics
As a parent, there are many things to consider as your child grows—day care, extracurricular activities and responsibilities at home, to name a few. Sometimes, it's hard to get past preschool, let alone think about the teenage years. Amid the bustle of everyday life, it's easy to put off planning for college until that time. But experts caution against that strategy.
Whether you've just started a family or your oldest is in high school, there are plenty of steps to take along the way to assure the whole family is ready for a postsecondary commitment.
It's never too early to start the college conversation with your child, said Andrew Elwell, director of student communications and marketing for the College Board, a national organization that helps students plan for postsecondary school.
“Talk to your child about what they are interested in,” Elwell said. “In middle school, or even younger, talk about the basics of college. What is it? Talk about what college is and what they want to do.”
Gauging interest in various fields or career paths can lay the groundwork for what courses your son or daughter should take. That applies whether they're thinking about a college or a trade school. As advanced classes continue to trickle from high school down to the middle school level, you might find yourself considering scheduling issues as young as sixth grade.
“Preparation looks different depending on your goals,” said Megan Lemmon, a school counselor at Westerville North High School. “I recommend backwards planning. Look at high school as a road map. You have to figure out your destination before you get there. If a student knows at an early age they want to attend a competitive school, take classes that will put them on track for difficult classwork.”
Garien Hudson, director of undergraduate admissions at Capital University, said colleges look for applicants who followed a strong core curriculum. Having a balanced schedule of classes, such as life sciences, math, foreign language and social sciences, is key. Help children develop strong study habits in middle school, so they are prepared for the rigors of high school and then college.
Once a student reaches the second half of high school, it's crunch time. Most counselors recommend students take the ACT or SAT college admission test several times starting in their junior year, so there's time to improve their scores. (Both exams have versions younger students can take to prepare for the real thing.) Start visiting colleges no later than junior year. Prime time for submitting applications is fall of senior year.
“The best thing a parent can do is be supportive,” Elwell said. “It can be a little stressful for students, so be their champion and help make things easier when you can. … It's really valuable. Make sure that when they hit those big milestones, you celebrate.”
Before parents begin to put money in the bank for college, they should consider if and how they want to help.
“Step back and think, ‘What do I want to do?' ” said Ben Hoeger, a Certified Financial Planner at Baird, a firm that provides wealth-management and other services. “It's different for everyone, and it is shaped by what their parents did for them. Some people, regardless of financial means, are adamant and will do whatever it takes to pay for their children's college. It's the pay-it-forward mentality. Others will give a hard dollar amount. The main piece of advice I continually reiterate, assuming you are starting early on, is to create a process and automate that process.”
One of the most common ways to start saving is through a 529 plan, an account specifically set up for college expenses that provides tax benefits. “A lot of companies will give you a payroll deduction right into the account,” Hoeger said. “If you automate it, it doesn't take action on your part to stick to the plan.”
Hoeger, who has three young children, recommends that if parents haven't thought about saving before a child's first birthday, it's a great time to start.
A 529 plan also works if a family has multiple children, since parents are always the account owner and the kid(s) are solely the beneficiary. If your oldest goes to a trade school and doesn't need the money, you can shift it to your youngest child who wants to go to an Ivy League university.
Megan Rodriguez of Clintonville said she and her husband, Michael, starting exploring college savings when their son, Owen, now almost 2, was born. “We looked into the 529 plan, but we decided we'd rather go with a plan that allowed more flexibility and for the funds to possibly be used for a nontraditional route,” said Rodriguez. “Instead, we went with a whole life policy through New Leaf Financial that we can contribute to every year. At 15 years, we're able to withdraw the funds tax-free.”
Along with savings, don't forget that scholarships and financial aid can have a huge impact on college costs. The FAFSA (Free Application for Federal Student Aid) is available for families to file in October of a student's senior year, and determines the loans and grants for which a student is eligible. Most high school guidance offices have information on locally available scholarships.
“If you're in a situation where your kid is a sophomore or junior in high school and you haven't saved for college, the focus needs to turn toward educating yourself on what financial aid is possible,” Hoeger said. “That can shape discussions on what college options are available.”