Many parents of high school students know that the future will very likely hold a college education for their child. But what is often uncertain is how they will pay for that education.
By Casey Galindo, Wells Fargo Education Financial Services
The Bureau of Labor Statistics recently reported that 60 percent of high school graduates enroll in a college or university for advanced studies. The average price for a four-year degree at a state school during the 2012-13 year was $22,261. It was $43,289 for a private, four-year college, according to the College Board. With these kinds of prices, many families will need financial aid to help cover tuition and room and board costs.
Financial aid comes in many different forms. Students can pursue scholarships, fellowships and grants, which typically don’t require any repayment. Once these options are exhausted, students can also pursue loans.
When first reviewing the options for financial aid, it can be overwhelming for students and their parents to comprehend all the options and steps they might need to take to financially plan for college. Wells Fargo Education Financial Services created the Five Steps to Financial Aid video series featuring “Mr. Fellows” to help families navigate the steps to obtaining the needed funds to cover educational expenses beyond high school. These steps include:
1. Fill out the FAFSA – This is the Free Application for Federal Student Aid, and is recommended for all students planning on pursing college, no matter their family income. It is used to determine a student’s eligibility not only for federal student loans, but also for work-study aid and some grants.
2. Estimate total cost – Colleges can provide students and their parents with an estimated cost for tuition, as well as for room and board each year at the school.
3. Determine additional expenses – College is more than just class, studying and taking tests. Other expenses like car insurance, gas money, memberships to campus organizations and even paying for a spring break vacation might not be covered by scholarships, grants and fellowships. However, students should apply all financial aid—even scholarships that might not have stipulations as to how the money is used—first to educational expenses.
4. Learn about financing options – Create a list of private loans available through your bank, as well as federal loan options. Compare available loan amounts, interest rates, whether payments can be deferred until after the schooling is complete and loan-term lengths.
5. Know deadlines – There are deadlines for submitting the FASFA and for most scholarship applications. Keep these deadlines on a calendar so nothing gets missed.
View the videos at www.WellsFargo.com/fivesteps and get more info at www.wellsfargo.com/collegesteps.