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Thursday, April 16, 2009

10 Ways to Stretch Your College Fund

This was originally posted on Frugal Dad on January 29, 2009
by Joy Harkins

Are you a parent interested in helping your child earn a college degree? Are you a student looking to save money on tuition?

Having completed a B.A., M.A., and a Ph.D, I have perfected the art of stretching my college dollar. I was fortunate to have assistance from my parents, but I also saved them money by graduating from my undergraduate program in 3 years by following many of these tips.

Here are 10 ways to stretch your college fund:

1. Open a 529 savings account. Instead of putting your child’s college fund in a regular savings account, open a 529 account. A 529 plan is a state-run investment program that helps parents and children save for college. The value of your investment grows tax-free until withdrawn.

In the years when withdrawals are made, the growth is taxed to the student not to the investor. This can be financially beneficial because a student’s tax bracket is usually lower. A 529 account can be used to pay for any accredited college and graduate school.

2. Take Advanced Placement (AP) courses. Incoming freshmen can literally shave off an entire term with the appropriate AP courses. Many high schools offer AP English, History, and Calculus. If your high school does not offer AP classes, check out your local community college (these courses are often offered at community college in the evening).

3. Start with community college. So you want a degree from the most prestigious university? Great, you can still start at your local community college! Community college is a great deal – lower tuition, smaller class sizes, and fewer impacted courses. And, students can transfer from community college to even the most prominent universities.

4. Attend a public university. Tax-payer dollars supplement public education for many reasons, among them so you can afford higher education. Public universities tend to be bigger than private institutions, but the education is not necessarily any different. In fact, large universities tend to hire big name faculty and have additional amenities.

5. Submit your FAFSA early. Although the FAFSA deadline is April 1, many people do not realize that the earlier you submit your application the greater your chances of being awarded financial aid. The FAFSA allows you access to loans, grants, scholarships, and work-study.

6. Apply for scholarships. Scholarship search engines such as www.fastweb.com, www.finaid.com, and www.petersons.com can direct you to thousands of internet based scholarships. However, the most fruitful scholarships searches are usually done in your local area or directly through your university. You should never have to pay for a scholarship application.

7. Supplement with online or community college courses. You may be attending an expensive liberal arts college, but you can take online and community college courses that count towards your degree. Check with your academic advisor to find out which courses are transferable towards your major. You can take these courses during the academic year or during the summer.

8. Utilize federal work study. If you submit your FAFSA and are not awarded a grant or loan, you may still qualify for federal work study. When you have a work study job your employer only pays a percentage of your full wage and the federal government picks up the rest.

These jobs are typically offered on campus, which makes it easier to work while going to school. If you qualify for work study, you are obviously a more attractive candidate for the job.

9. Consider being a residential advisor. If you plan to attend a campus with on campus housing, you may be interested in becoming a residential advisor. These are students who live in the dorms and oversea the other students.

Being a residential advisor also provides valuable life skills, such as mediation, time management, and communication. Typically, residential advisors receive room and board as compensation for their duties.

10. Know your limits. College is a transitional time and involves exploration of personal and educational interests. While you want to enjoy these exciting years, for every term you spend in school you will be paying for tuition, housing, food, textbooks, clothes, and extracurricular activities. Therefore, it’s important to maximize your chance of being successful – and this means knowing your limits.

Enroll in as many units as you can realistically complete successfully, join as many clubs and organizations as you can reasonably attend, and enjoy as many social gatherings as you can without compromising your real purpose for being in college.

Here are more ways to Invest in Your Child's Future.

photo by ANVRecife

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