 "For the 2012-2013 academic year, the average cost for an in-state public
college is $22,261. A moderate budget for a private college averaged $43,289,"
says McDonough, CEO of Studemont Group College Funding Solutions. "But for elite
schools, we're talking about three times the cost of your local state school.
Either way, your kid's higher education can easily shoot into six figures after
four years."
Along with worrying about rising tuition prices, parents also fear for their
own futures if their retirement savings are drained by children's college costs,
McDonough says. Only 14 percent, for example, are very confident they'll have
the money to live comfortably in retirement, he says, citing a 2012 survey by
the Employee Benefit Research Institute.
"Families feel they're faced with conflicting goals, but there are numerous
ways to pay for college while investing in your future retirement," says
McDonough, who offers insights for parents to keep in mind while planning for
their child's education:
At a time when so many American families are
financially strapped, college is an especially stressful topic because
parents know higher learning will help their kids succeed. College graduates
earn 84 percent more than those with only a high school diploma, according
to Georgetown's Center on Education and the Workforce. Here is how earning
breaks down over a lifetime, based on education: A doctoral degree-holder
will earn $3.3 million over a lifetime; $2.3 million is estimated for a
college graduate; and those with only a high school diploma can expect $1.3
million.
Move retirement assets to
qualify for grants: Most parents know about the 529 savings account, but
that's not necessarily the best or only option. Reallocating your retirement
assets, such as 401(k) plans, can better position a child to qualify for
grants and scholarships. This legal and ethical maneuvering may be the
single most important factor when considering how to pay for college.
Know your student's strengths and weaknesses:
Consider independent and objective analysis of your future college student.
Assessment might include a personality profile and a detailed search for a
future career. Also think about a more nuts-and-bolts approach, including
scholarship eligibility, SAT and ACT prep courses, review of admissions
essays, and an in-depth analysis of chances for enrollment in a student's
top four choices of colleges.
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Make a checklist of financial aid
forms: In order to maximize a fair price of higher
education, remember there is plenty of data to review. McDonough
recommends a checklist with a timeline and notable deadlines. Be
ready to troubleshoot the "alphabet soup" of data forms: FAFSA,
the Free Application for Federal Student Aid; CSS profile, with
the College Scholarship Service; SAR, a student aid report; and
more. Think about this process as a second job, or find
professional help you can trust.
___
John McDonough is the managing member at Studemont Group, which
is primarily focused on helping retirees gain peace of mind with
unique market rescue and recovery programs. He is also founder,
president and CEO of Studemont Group College Funding Solutions. His
experience in the financial services industry includes being
managing partner at Granite Harbor Advisors in Houston and
divisional vice president of AXA Equitable/AXA Advisors, the
third-largest insurance company in the world.
McDonough is a member of the prestigious Forum 400, a qualifier
at the Court of the Table qualifier for Million Dollar Round Table,
an active member in the National Association of Insurance and
Financial Advisors and Society of Financial Service Professionals,
as well as American Association of Life Underwriters. He has
completed the course work to sit for the Certified Financial Planner
professional designation exam from Rice University.
[Text from file received from
News and Experts]
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