Savvy College Financial Strategies Paying for College and Discussing it with kids! Cozy Wittman, Education & Partnership Manager College Inside Track 612-850-5729 cwittman@collegeinsidetrack.com

College Inside Track saves families an average of $75,488 off the four year college sticker price!

3 Key Factors For Success Social Academic Financial

University of Chicago: $74,526 Northwestern: $72,980 NYU: $71,784 Drexel University: $ 71,763 University of Pennsylvania: $68,687 St. Thomas: $54,133 University of CA-Berkley: $36,015* University of Michigan: $31,396* University of Minnesota: $28,304* *in-state tuition rates UNC this year: $23,000 – this year.

There is no purchase as significant as college that people know so little about BUT think they know the facts.

Average family college debt: students & families per child $57,800 in loans for students & families per child *Sources: Nerdwallet.com Got Parent PLUS Loans? Save Money With These Alternative Payment Plans and The Institute for College Access and Success accessed 8-18-17

Determining A Family Strategy How do know what you can afford?

There are multiple ways to pull a successful financial college experience together! Parents & Students Merit Aid Loans Need Based Aid

Parent and Kid contribution potential? Parents & Students Merit Aid Loans Need Based Aid

What is your Philosophy? Who has skin in the game? “We will pay it all, we don’t want our kids to have loans” “We have a 529 /other savings, that’s our contribution, everything else is theirs” “We have a 529/other savings but we would love the college to cost $X so they have money for grad school” “Our student needs to pay for X percentage and we cover the rest” “School is all on the student, we expect them to take out loans for school”

Break Down Where Money is Coming From! Parents Is there savings? 529? Sports fees, private school payments convert to tuition payments, etc Pay as you go monthly Loans Student Savings Merit Aid Grants/Scholarships AP/PSEO/CIS Work or Work Study Loans Have this conversation NOW!

4 Tips to Take With You! Have this talk with the student early in the college search Make financial considerations an equal part of this search along with academic and social fit Determine the strategy for who has skin in the game and determine what your “maximum” bottom line is Have an open discussion around loans and use real world examples to illustrate payback

How Does “Aid” Factor into the Discussion? Parents & Students Merit Aid Loans Need Based Aid

What is a FAFSA and what on earth does it mean? Free Application for Federal Student Aid – FAFSA Application for Federal student loans Formula determines Expected Family Contribution – Roughly 47% of your net income Colleges use the number to determine “Need”– sticker price of the college minus the Expected Family Contribution (EFC) = Need We aren’t getting any “aid” so we aren’t filling out a FAFSA True, a family may not get need based aid, but if you want your student to take out loans, it is required Some merit based schools use the FAFSA as a key that unlocks the grants and scholarships they are giving Some colleges add merit to the package just because the family filled out the financial forms and there is no way to determine which schools those are

Need Based Aid Forms Grants & Scholarships FAFSA – Schools use it to determine need at their college EFC – Expected Family Contribution Not tied to tax returns for divorced families Done yearly CSS Profile & school specific forms Forms Added to your financial package Revised yearly based on FAFSA outcome Grants & Scholarships Need Based Aid

Merit Based Aid Criteria Grants & Scholarships Varies school to school Grades are only one factor of many that determine the amount Location, talent, demographics Criteria Added to your financial package Generally applies for all four years if your student meet basic terms Read carefully! Grants & Scholarships Merit Based Aid

Top 2 mistakes families make with merit aid? Not all colleges offer merit aid! Narrow the field of colleges too soon!

What about other scholarships? There are millions of dollars of unclaimed scholarship money! If we just spend enough time, we should be able to get some! Myth The vast majority of kids don’t “win” that money Ave award amount: $1950 Deducted from Merit Aid package by the school SO MUCH MORE MONEY is given by colleges Truth What about other scholarships?

6% 40% 7% 11% 35% Scholarship/Grant Sources Employers Federal government 40% 7% Private scholarships 11% State governments 35% Colleges

Loan Considerations! Parents & Students Merit Aid Loans Need Based Aid

LOAN Limits Federal Student loan – maximal set amount Freshman - $5500 Sophomore - $6500 Junior - $7500 Senior - $7500 State loans- http://www.gocollege.com/financial-aid/student-loans/states/ Parent Plus loan – limited to the cost of attendance minus any financial aid the student is receiving Home equity loans are no longer tax deductible, but rates still make them an attractive alternative Generally, private loans should be reserved as a last resort!

Guidelines for Debt Never take out more in loans than a first year salary in your chosen field For every $10,000 in loans you take out, it will be roughly $100/month loan payment Federal loans are only available for the year they are offered, so consider the entire 4 years before declining loans

What We Do Just like you hire a realtor for the major purchase of a home, you hire us for the major purchase of college Most families do this search a couple of times, we have done it hundreds of time We find that blinders and myth often cost families money

We help navigate the complicated process and find the right fit

We help families save lots of money

We are a neutral third-party that students listen to

How do we partner with schools Support the work that you! Help get the message to the parents Free presentations on strategies to reduce the cost of college Monthly newsletter focused on college search for you to post Training for counselors/teachers in your school for CE credit Free family consultation to discuss goals for college, share strategies that align, estimate the EFC

Questions? Cozy Wittman, Education & Partnership Manager College Inside Track 612-850-5729 cwittman@collegeinsidetrack.com