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Financial Planning for College Students (That Can Save You $$$ In Loans!)

For most students, school is both an exciting and stressful experience. Living away from your parents, living alone or with a roommate, making your own decisions, and managing your expenses are just a few of the challenges you will face. But, financial planning for college doesn’t have to be difficult. It’s critical to remember that almost anyone can go to college with the correct mindset, and without taking out thousands in loans! Here’s what you need to do.

How do I prepare my child for college?

There are a few ways to prepare your child for college. But the biggest key is to make sure your child understands the financial choice that they’re making if they choose to go.

Of course, they can lower costs in many different ways. And, if you’re having a conversation with your kid, you may want to also mention if you will or will not help — and if you will, how. This helps set up boundaries as well as expectations. And, by doing so, your child will understand what they need to do to prepare for school.

Related: Does Junior Really Need to Go to College? 5 Reasons to Skip It

Looking into financial planning for college? Here's a great place to start! Financial Planning For College Parents

When it comes to financial planning for college parents, you’ll most likely want to know where you stand as far as income, and if your child will qualify for FAFSA.

If so, great, you can then follow other steps to lower their college expenses.

If not, you’ll need to look into other ways to help your child save money. (keep reading for ideas!)

How do you know if you have financial needs?

It’s actually very easy. To see if your child will qualify for financial aid, you’ll need to fill out the FAFSA. From there, they will inform you if your child is eligible for financial aid, and if so, how much.

Financial Aid Planning For College

After filling out the FAFSA, you’ll know if you qualify for financial aid or not. If you do, they can be a few thousand dollars every semester to help your child attend college.

If not, don’t worry! There are other financial aid planning options, including…

  • scholarships,
  • work,
  • and even loans (although those should hopefully be the last resort).

Related: The Real Cost of College

Can I get financial aid if I or my parents make over $100k?

What if your parents have a solid income? Can you get financial aid if your parents make over $100,000 a year?

Most likely, no.

Of course, there’s nothing wrong with filling out the FAFSA and seeing if you qualify. And, there are a few waivers that can help you qualify, even if your parent’s income is higher.

Related: Investing In College: Is Going Back to School Worth It?

How do middle-class families afford college?

For most middle-class families, they can afford college because of FAFSA, scholarships, loans, and choosing a less expensive school.

While some families may not qualify for FAFSA, they are able to cut costs in other areas. And, there are so many other ways to make money or save money when it comes to college.

Related: Get Scholarships and Grants for College

Financial Planning for College Students

Now that you know some frequently asked questions, let’s talk about financial planning for college students.

Beware of Credit Card Traps

If you opt to obtain a credit card, you should proceed cautiously. A credit card is unquestionably valuable, and it might be used to help you in getting a good credit score.

However, if you are late with your installments, it will impact your credit score negatively. It is recommended to pay off the debt at the end of each month. Whether you use credit or not, try not to buy the stuff you don’t need.

Financial management isn’t overly complex or difficult to understand. Financial management necessitates strong judgment and self-control. You’ll be okay if you keep a close eye on things.

Get a Journal and Start Budgeting

Get a planner and start planning out how you will spend your money. For example, pledge to save a particular proportion of your monthly income, and set aside a specific amount for groceries, gas, entertainment, and so on. Getting organized is excellent practice for the future.

Apart from starting a journal and planning all your expenses, you may wonder how to pay for certain items that are school-specific, like a tutor or your textbooks. To save money on items like that, try finding more affordable alternatives. For example, TutorOcean offers private tutoring for way less than you’d find in your community.

Related: 10 Ways to Actually Stick to a Budget

Purchase Insurance

State law may require accident coverage. Your university may need health care coverage.

Remember to obtain renters insurance if you’re living off-campus. Students who live nearby are typically protected by their parent’s insurance, but you’ll want to make sure and check. If you have to get your own, you can quickly compare free insurance quotes online to discover the best coverage for your needs.

Related: Insurance Needs: What Type of Policies Do You Need?

Learn to Sacrifice Liberties

A financial plan allows you to see what you’re spending, so you don’t become obligated to keep up with your way of life. As a student, expensive gadgets, going out with friends, and dining out all week will most likely change drastically.

Before spending money on frivolous items that aren’t necessary for you, make sure you’re meeting your financial responsibilities. Remember that college will most likely be a time in your life when you will earn no money or just a little, so be prepared to make some sacrifices to have financial stability.

Related: 4 Huge Benefits of Graduating From College With No Debt

Financial planning for college - save on textbooksDon’t Overspend on Textbooks

Books are a fundamental requirement for students in college, and new books are costly, especially at your college bookstore. Consider borrowing books from your campus bookstore or purchasing second-hand course books from online sellers to avoid paying too much for books that you will most likely not keep.

If you can’t find a used book or need a brand new one for certain reasons, look into who is offering the best deal.

Related: Money Saving Tips for College Students

Stop Impulse Shopping

College years may be some of the most carefree years of your life. However, carefree does not imply irresponsible. Being a college student, your money is typically restricted, so living within your limits is critical to avoid wasting money. Be selective about how you spend your allotted allowance when the classes start.

Also, set financial goals for yourself to avoid impulsive purchases and debt accumulation. Begin saving for a spring break journey now to plan one. Each outrageous night out costs money that might be used for other items — like spring break :).

Living within your means now prepares you for future financial success by lowering the amount of debt you will graduate with and developing solid money management practices. Several undergrad offers and deals are available, particularly close to your campus, that can help you save money.

Student Loans Are Expensive

It is critical to acknowledge that student loans are costly to repay, and the shocking reality is that the vast majority of graduates struggle to repay their student loan obligations.

Acquiring additional cash to fill your wallet for the semester may be tempting when you first start college. But, those small purchases can sometimes cost you far more than they are worth. The initial credit will skyrocket as interest accrues, leaving you with a massive balance.

Related: How to Get Through College Without Debt

Get A Part-Time Job Or Choose Work-Study

University students work a wide range of hours per week, from five to ten hours per week to full-time and anything in between. Before deciding on your budget and how much you’ll have to spend, you’ll need to see how much you can realistically work and how much you’ll bring in.

Your goal should be to collect as much as you need, plus some more to be safe. Keep your school objectives and education as a primary priority. And, try to reduce your extracurricular expenditures, so you don’t have to work so many hours that your studies suffer.

Related: How to Work Toward a Debt-Free College Degree

Saving Money In College

Most undergrads suffer financial challenges in their academic careers, regardless of whether they have recently graduated from high school or are non-traditional or mature students.

Planning is an essential foundational skill to develop. In order to make financial planning for college easier, follow these tips!

Looking into financial planning for college? Hopefully this article answered a ton of your question!

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AUTHOR Kimberly Studdard

Kim Studdard is a strategy consultant and course launching expert. When she isn't spending time with her daughter and husband, or crying over This Is Us, you'll find her teaching other mompreneurs how to scale their business without scaling their workload.

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