Parent Pathways

Christa Gala: Planning for college no easy task

August 26, 2013 

I was recently on the campus of UNC-Chapel Hill.

On move-in day.

In the midst of parking woes and throngs of people, it occurred to me that move-in day is a victory for both students and parents.

Because college is expensive.

Over the past 25 years, average college tuition and fees in the United States have increased more than 440 percent, according to the National Center for Public Policy and Higher Education.

That’s four times the rate of inflation. Once upon a time, parents (my own included) could cobble together enough money for tuition and sometimes get a loan. Often, kids got the loan themselves or made up the difference with scholarships or jobs.

But the gap between affordable and out-of-reach is becoming so large that most students can’t make up the difference with part-time work. Some parents are unwilling or unable to shoulder additional debt as they near retirement.

As a result, today’s degrees often come with a side order of debt. In fact, roughly two-thirds of those who graduated with four-year degrees in 2011 borrowed money to finance their education, an average of more than $26,000, according to The Institute for College Access & Success.

You’ve heard of financial planners. Now we have college planners, folks who basically not only help you and your kid navigate the college application process, but also work to bridge the financial gap and reduce the total cost and the post-school debt load.

Of course, there’s a fee, but most introductory classes are free.

Rodney Godwin, a college planner and the owner of Godwin Planning Solutions, gave me a few inside tips he shares with parents during classes.

For starters, students should aim high, right? Apply everywhere?

Not so much.

Consider colleges where your child will be in the top quarter, or at least the top half of incoming students, according to Godwin.

“Pick a college where their grades, GPA, class rank and SAT/ACT scores are above average for what that school normally selects,” he said.

That way, students will be more likely to graduate in four years. That may not sound like a big deal, but 34 percent of recent graduates needed a fifth or sixth year to graduate, according to the U.S. Department of Education. A year or two adds up to a lot of extra money.

And if a student is in the top quarter or half of incoming freshmen, he or she is more likely to be offered what colleges typically call “merit” money.

“Any funding a student gets will be based on the parent’s finances,” he said.

The second thing Godwin talks about in his class is financial positioning. Most people probably think the more money they save for their kid’s college fund, the better.

That’s a good thing, but actual accounting practices could affect a student’s financial aid package.

“Generally, you do not want to have money in the kids’ names,” Godwin said.

Although colleges must follow certain rules for need-based funding, merit-based funding decisions are at the college’s discretion. So if a school sees that a student has a big account earmarked for college, it might dissuade them from offering as much merit aid, Godwin said.

It’s complicated, that’s for sure. It makes me glad my kid is only 10.

Then again, 10 came fast. Eighteen is just around the corner.

For more information, visit http://www.freecollegeplanning.org and enter “42” in the section box for free local class listings.

cwgala@gmail.com

Cary News is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service