|Bringing Financial Logic To Your Emotional Decision
"Wow! What a great book! I spent the weekend blowing
off friends at the movies so I could finish reading it. Your
book is well organized and clear with lots of good advice
and examples to help the lay person (me) begin to see how
it might be possible to navigate my way through this
process without indebting myself or my son beyond all
hope. What I found most powerful about both the book
and the seminar, was the sense of hope both provided."
The 4 Ways to Pay for College
2. Financial Aid
3. Cash Flow
1. Savings gives you options. Without savings,
the means through which you can pay for
college is limited. The key is to save in the
2. Financial aid may be private scholarships,
merit-based aid, or need-based aid. You need
to find out which types are available to you and
how to get them.
3. How much free Cash Flow is left over for you
at the end of the month? This will determine
how much of a payment plan you can
reasonably commit to.
4. Once the first three resources are
exhausted, you and/or your student must apply
for Loans to meet college expenses. Three
important questions to ask before borrowing:
1) How much can you afford to borrow (cash
flow), 2) How much are you willing to borrow,
and 3) How do you feel about that? You may
be willing to take on a lot of debt. . .or you may
not. Either way, that will help you determine
which colleges fall into your price range.
In developing an efficient game plan for
college, a family should analyze each of the
four resources. Combine that with a retirement
plan, career planning for the student, a good
college search, and you will be better prepared
than 99% of your peers!
Questions to Ask
- Do you know who receives the most money for
college and why?
- Did you know some college funding strategies
should be implemented 18 months prior to
- Do you know how much of the total cost of
college you (as parents) can afford to pay without
sacrificing your retirement dreams?
Thinking like a CFO
Your household is a mini-business. You have income
that comes in, expenses that go out, while seeking a high
ROI (return on investment) on your assets. Fortune 500
companies have CFO's to help them run efficiently. You
need to think and plan as the CFO of your household.
College is too large of an investment/expense to not take
a step back and formulate an efficient game plan.
How you pay for college will impact your retirement.
Remember: you can borrow for college but you cannot
borrow for retirement!