There are rarely parents in this world who don’t want their children to be highly educated. Every parent no matter how rich or poor, living in a mansion or a trailer park, wants to see their child succeed. Some dream of turning their kids into doctors while others want lawyers in their house. Some even dream of raising the next president of the United States. And it all comes down to one word i.e. money.
Funding is required by every parent to get their kids into good reputable colleges because college education has become more than a norm these days. It’s a dire necessity. And people dealing with credit card debt relief issues understand the value of saving every penny instead of being tacit towards the situation.
Following are the strategies that will help you through the process of paying for your child’s education:
1. FAFSA and Your Expected Family Contribution
The U.S. government provides help in the form of Free Application for Federal Student Aid (FAFSA) that estimates the amount of income or funds you’re contributing or can contribute towards your child’s education. The EFC (Expected Family Contribution) is the information of your family’s assets and what you can provide to your child. Having a lower EFC will guarantee your child eligibility for more loans and assistance from the federal government.
2. Pre-paid Education Costs
Pre-paid education costs or tuitions are managed at a state level for students in need. Universities and colleges prepare pre-paid schemes to help parents save money a considerable time before the entrance of a child into college. The time lapse will help parents save and deposit money so that they don’t have to look for loans at the eleventh hour. At times, the deficiency of money can lead to students wasting their years wandering here and there waiting to apply next year. Pre-paid tuition can save a lot of time and keep children away from the frustration of not being able to attend college on time.
3. Using PLUS
Discharged right from the United States Department of Education, a Parent Loan for Undergraduate Students (PLUS) is directed for parents who are not financially able to pay for college expenses of their children. For getting this loan, the government must first go through your credit history and determine your liability. Even if a particular parent or guardian does not meet the requirements set by the government, they would still be eligible for receiving unsubsidized credit endowment.
4. Tax Benefits
Saving for your child’s college education has tax benefits too. Under the federal law, you can get credit on your annual tax returns by saving up for your child. Though two credits are available to be granted per year, you can only opt for one. Credits like the Hope Scholarship can get you a tuition saving up to sixteen hundred dollars for each eligibly dependent child you have.
5. Saving is the Key
Most parents start saving for college the day their child is born. It seems to be a wise decision because of the increasing costs of college education that seems to rise each and every passing year. A savings plan known as Section 529 aims at starting the savings process much earlier rendering parents with a savings account titled the Coverdell Education Savings Account getting tax. Parents receive benefits from this account until their child turns eighteen.
6. Home Equity
The home equity you have acquired for the many years you’ve been residing in the house can actually help you steer away from debts like student loans. This can also help you get more tax benefits.
7. The Investment Decision
Make certain decisions about which scheme or loan you want to invest in as it will determine the outcome of your tax returns and the effects on your child’s future.
8. Make a Habit of Saving Monthly
Once you get into the habit of putting aside a few dollars for your child’s education, you’d be amazed at how much money you’ve actually saved contributing bit by bit.
9. Beware of Scams
There are a lot of scammers who prey on innocent parents wanting to save some college money for their child. Promising good returns and then disappearing is a common act for these vultures so choose your savings keeper wisely.
10. Safety First
Saving can be an easy task but only if you have put away that money in a secure place. Make sure you have a security deposit or a secret saving place for securing all this hard-earned money.
People who are looking for credit card debt relief along with saving some money for their child’s college needs can be successful at both. All you need to do is make some strategies and stick to them.