PARENTS, WATCH OUT FOR THESE MISTAKES IN FINANCING COLLEGE TUITION FEES
One of the pressing headaches all parents have to face are the pricey tuition of their kids bound for college. More than university payments, other expenses such as allowance and materials need to be considered as well, something that further adds to every folks’ burden. Despite this, nobody can deny that a college education is the first stepping stone towards a stable future hence, many parents are struggling to send their children to excellent universities, and even taking every measure available in order to make the ends meet. However, in doing these, tendencies that they might commit mistakes are inevitable. Here are a few of the most common wrongs parents make in funding college fees.
Putting all your trust in 401 k
Sure, these pension accounts are reliable, but being dependent on these can also be a bad move because borrowing against your assets here may result to ineligibility for matching funds.Aside from this, in case you lost your job, you might be required to pay off all the money you borrowed within a short amount of time.
Delaying your savings
Like what many say, time flies by really fast, so if you think you have ample time to start saving for your newborn’s future, think again. Most tertiary education tuition fees amount to thousands of dollars per year, so you might want to start setting aside a little money every time you get your salary.
Shutting down your 529 account
Most parents close down their 529s as early as their child starts college. However, it would be a better idea to keep it and continue depositing a bit of cash every time as it will help you keep earning minus the taxes.
Relying on scholarships
The chances of landing a full college scholarship is very rare and not as easy as you think, so while it would be a nice picture to have your child in a good university without paying anything because of his/her impeccable skills, this is not exactly a wise action.
Failing to consider other options
Yes, Ivy League schools are every family’s dream, but let’s face it, these institutions are highly expensive and insisting on sending your kid here might not go well for both of you in the long run. There are many other schools that offer quality education as well, at a more affordable price.
Not doing a background check on loans
Among the many issue faced by parents and students are loans, so avoid letting your child take out one of these without doing research first.
Keeping it to yourself
It is true that paying for school expenditures are generally the parent’s job, but it is also necessary that your kid knows your financial status, so find time to sit down with them and talk about your finances as it would spare you both from further problems in the future.
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