Questions & Answers

The amount a family borrows depends less on the published tuition and more on how the overall four-year+ plan is structured. Many families focus on first-year costs and underestimate the total four or more-year commitment. Without projecting tuition increases, housing, interest, and changes in income, borrowing often becomes reactive instead of strategic.

For more information read our e-book on college loans in our e-book portal.

Out-of-state schools can sometimes provide strong programs or experiences, but the cost difference must be evaluated over four+ years. A higher price does not automatically produce a better outcome. The key question is whether the additional cost produces measurable academic, career, or financial benefit.

If you are considering attending an out-of-state college, we highly recommend applying to private colleges instead of out-of-state public college.

Depending on your student’s academic achievements and talents, attending a private out-of-state college could be less expensive than attending an in-state or out-of-state public college.

Not necessarily. Many lower-cost public universities, community colleges, technical colleges and regional institutions provide excellent education and strong outcomes. Prestige and cost do not always correlate with long-term success.

For more information on this subject, view our video in our video portal “Is an Associate or Technical Degree Worth Considering.”

Colleges publish a full retail price, but many students receive some form of aid. However, “discounts” should not be confused with affordability. Families must evaluate net price carefully and understand what portion is grants versus loans.

Most colleges increase tuition annually. A family should project four-year+ cost estimates rather than relying solely on the first year’s published numbers.

Of course, the percentage will vary from year to year, but you could be safe to estimate tuition to increase each year by 3 to 6 percent yearly.

Some colleges will advertise they will freeze tuition cost for four-years to increase their student’s application pool.

To make up for the tuition loss, many colleges will increase the percentage on other college related costs like fees, room & board, etc.

Private colleges often have higher sticker prices but may offer institutional scholarships or grants (college’s own money). The final net cost can vary widely depending on aid packages received by the FAFSA, student’s academic or special talents, and family income.

The institution scholarships normally do not come from the college endowment funds. They come from special scholarship funds that were set-up by alumni, corporation, etc.

Also, institutional scholarships come from tuition discounts. I call these discounts as funny money.

Cost of attendance includes tuition, fees, housing, food, books, transportation, and miscellaneous expenses.

There are other costs that most families overlook, i.e. entertainment, snacks, spending money, lab fees, bus and taxi fares, transportation back home, sorority and fraternity cost, sporting events, sporting facilities (gyms), cable TV hookup and rental, etc.

It is important to account for all components, not just tuition.

Graduation timelines vary from one student to another. According to the College Board, the average graduation time is a little shy of 6-years. Some students change majors, transfer schools, or take lighter course loads.

Planning for potential additional semesters can reduce financial surprises.

This is why the information in our video and e-book portals is so important. In order to graduate on time, four-years or less will depend on the student’s college readiness, and selecting a college that is a good fit, academically, socially and affordable.

Sticker price is the published tuition. Actual cost is what your family pays after scholarships, grants, and aid. These can be very different numbers.

Parent borrowing should be evaluated carefully, especially regarding retirement readiness. Loans should not jeopardize long-term financial stability.

Parents should avoid borrowing if all possible.

Federal loans generally offer more flexible repayment and protections. Private loans depend on credit and lender terms.

Try to avoid borrowing private loans if all possible.

Watch our videos on student loans in the video portal.

All student loan amounts are too much!

But a practical guideline is that total borrowing should not exceed expected first-year salary. Exceeding that amount can create repayment strain.

Federal loans offer certain protections and repayment plans. Private loans have fewer safeguards. Default has serious long-term consequences. Neither federal nor private student loans cannot be file in bankruptcy.

Yes. Missed payments can impact both student and parent credit scores either in a positive or negative way.

Without a doubt! Parent loans, especially later in life, can extend working years and reduce retirement security.

Thousands of parents that are age 55 or older have student loan debt.

Different majors produce varying income outcomes. Families should weigh passion alongside realistic earning potential.

STEM degrees (science, technology, engineering, and math) will be worth the cost of the education.

For many families, beginning at community college and transferring can significantly reduce overall cost.

This is normally true for students that are not college ready. If your student scores less than 21 on the ACT test, it would be advisable to attend a community college for the first two years before attending a four-year college.

Campus living can enhance experience but increases costs. The decision should align with both financial and personal goals.

Many colleges require first year students to live on campus. However, living on campus is a personal choice.

Not inherently. However, families should understand career pathways and potential income trajectories.

We have too many students with a college degree that are delivering pizzas or bar tending.

There is nothing wrong about getting a liberal art degree. However, you need to decide if the cost of getting this type of education worth the cost of the future income potential.

Academic preparation, maturity, time management, and clarity of purpose all contribute to readiness.

You know your student best. If they were an average student in high school (C or C+), or score below 21 on the ACT test, your student may not be college ready.

Without a doubt! Skilled trades and technical certifications can provide strong income opportunities with lower educational debt.

Many students that have a skilled trade degree or technical degree, are earning more income than one half of students with a four-year degree.

Watch the video in the video portal entitled “Is a community or technical degree worth considering.”

The AOTC can provide up to $2,500 per year for eligible college expenses during the first four years of undergraduate education.

This credit helps offset tuition costs for graduate school, professional certifications, or continuing education, but it is smaller than AOTC.

Sometimes. However, expenses cannot be counted twice. Strategic planning is important to avoid losing credits or triggering taxes.

Yes. Using 529 funds for certain expenses may reduce or eliminate eligibility for tax credits if not coordinated properly.