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Of all the topics associated with making a final choice about which post-secondary institution to attend, financial considerations are often the most challenging to address.

Parents and college-bound seniors who have not yet thoroughly discussed the financial elephant in the room will greatly benefit from giving this topic the careful attention it deserves. After all, higher education is one of the most significant investments a family will make, and taking on excessive amounts of student loan debt to attend an unaffordable school can have long-lasting consequences for both students and their parents.

Here are five tips to help shine a rational light on what can be a delicate and sometimes emotional topic:

1. Review Award Letters

Review and compare financial aid award letters carefully. Make sure the funds being offered cover each year of your child’s proposed course of study and are not more heavily weighted in the early years. Also, make sure you and your child understand any conditions that apply to scholarships or other forms of aid. For instance, it’s important to know if a particular major needs to be pursued or grade point average needs to be maintained in order to continue to receive the aid that’s been awarded.

2. Clarify and/or Update Information

Obtain clarification from the admissions or financial aid offices on any aspect of the offer of admissions and award letters that are unclear. Provide updated information if your family’s circumstances have substantially changed since the time period reflected on your Free Application for Federal Student Aid (FAFSA) filing and/or your College Scholarship Service (CSS) Profile. Learn about the appeal process, which will vary by institution, and pursue it if needed. Lastly, if your child received a more favorable financial aid package from a similar school, you may want to ask the institution of greatest interest if they would be willing to match what was offered by a competitor school.

3. Assess Available Funds

Carefully review your 529 college savings plan balance and assess the value of any other types of investing and/or savings accounts you have earmarked for higher education. Determine the process and timing for the withdrawal of funds so that you are ready for when the initial payment and subsequent ones are due.

If you know or suspect others, such as grandparents, a non-custodial parent, or other relatives have also been putting money aside on your child’s behalf, determine, to the extent possible, what could be available for use through those sources. Strategize about how best to utilize those funds and in what sequence.

4. Identify the Gap

Determine how much of a gap there will be between each finalist institution’s “net cost” (the total cost of attendance minus grants and scholarships) and your available funds from all sources. Consider all possible approaches, without taking on excessive student loan debt, to fill the immediate gap and the anticipated gap in subsequent years. For instance, if you have not yet done so, explore whether there are employment opportunities on or near campus that could help cover some of the remaining costs. Keep in mind, however, that these may not be guaranteed. Beyond this, determine if there could be opportunities to serve as a resident advisor in upper-class years to defray the cost of housing or opportunities to serve as a research assistant or in some other capacity that can help with tuition costs. And don’t overlook options like living at home for the first year or two, choosing a lesser-cost in-state versus out-of-state school, or attending a community college to accumulate core credits that could be eligible for transfer.

If the size of the gap requires taking on more student loan debt than your family is comfortable with or requires taking on more hours of weekly employment than your child may be able to handle with a full academic course load, be certain to put these concerns high on your list of discussion topics.

5. Discuss and Decide

With a full understanding of the financial picture for each school under consideration, have an open and honest discussion about each option with your child and include others, as appropriate, who have been instrumental in the college planning process.

If student loans are needed to fill the gap in order to attend a desired school, be sure to understand the total amount that will need to be borrowed and discuss exactly who will be responsible for repayment. Calculate the approximate size and duration of monthly payments and consider what impact such debt may have on the quality of life after college. As a college-bound teen, it may be difficult to imagine the impact of carrying significant debt into one’s thirties or even forties. Additionally, if parent loans will be required to cover costs, carefully consider the effect such loans may have on the quality of your life and the rest of your family as you enter your later years.

In evaluating the potential impact of student loan debt, you may want to consider projected earnings given your child’s intended course of study (keeping in mind that this can change several times during undergraduate years), and other factors which could sway your family’s decision one way or another. And of course, be sure to discuss whether an alternative institution that is substantially less expensive than your child’s “dream school” could lead to a brighter and less stressful financial future for your child and you.

May your discussions lead to selection of a school that is a good academic, social, and financial fit!


Patricia A. Roberts is a motivational speaker, writer, and veteran of the college savings industry. She has led college savings initiatives at premier financial services organizations like Merrill Lynch and AllianceBernstein, and has authored Route 529: A Parent’s Guide to Saving for College and Career Training with 529 Plans. In her current role as COO at Gift of College, she promotes 529 plans as a financial wellness benefit in the workplace.