Industry News

10 Tips To Take Control of Your Students College Success and Financial Future

May 09, 2012

Student financial aid expert (and Dad) Brian Cox can share a few tips on talking to kids about college selection and affordability, as well as helping them develop smart financial habits/attitudes.

As an executive for Cology Inc., one of the nation’s premier student loan technology and core processing organizations, Cox sees first-hand the heartaches that can happen if parents don’t begin important college affordability and financing conversations early. Here are a few of his favorite tips:

1. Start Early
Keep conversations age appropriate, but begin talking to children in elementary school about saving money and getting good grades for college. Make sure to motivate and support, not pressure or stress, through encouraging everyday conversations. Make trips to the supermarket fun by asking your kids to find the best buy for each of the items on your list.

2. Teach Want or Need?
Why not introduce financial accountability and prioritization now, before real-life pressures and tuition bills rain down? The sooner kids learn how much things cost, the faster, more confidently they can begin evaluating needs and wants -€“ a skill some adults haven’€™t mastered.

3. Make It Fun
Engage children in real-life financial scenarios like choosing a family vacation based on a set budget, or having a birthday party budget, or helping you to only spend a predetermined amount at the grocery store. Teens and tweens are often amazed at how much it costs to feed, clothe and entertain the entire family.

4. Lead By Example
Let children see you making financially thoughtful decisions, not emotionally charged, or irrational choices. Explain why you are making certain choices. Point out friends, family and neighbors’ financially sound actions as well. Always keep conversations realistic yet positive, even when if you yourself are financially stressed.

5. Value vs. Cost
Junior high is a great time to introduce value versus cost. Explain that everyone wants an iphone and designer jeans, but less expensive options can serve the same purpose. Appearance-conscious tweens might not agree with your value assessment, but can acknowledge the logic of need vs want. Or tell your teen that you are willing to provide $XX towards a phone/jeans and if they want better, they can make up the difference in cost – that puts them in charge of the value decision. As they financially mature during high school, they’ll be prepared to determine if an expensive college really takes them further than an affordable option. They’€™ll understand which college investment is worth the end result (or career) and how income and debt will impact their budget aka lifestyle after graduation.

6. Research and Plan
Has your child expressed interest in a certain college? As a parent, don’€™t prescreen children’s dreams,€“ help educate and encourage. Visit the college online or in-person. Make sure costs and grade requirements are part of the discussion. Then create plans to earn the grades or money needed for admission. Explore several back-up options. If children change their mind, simply revaluate and amend the plan. This helps children learn that detours are okay as long as preparation continues.

7. Shop Around
As planning follow-up, talk to teens about looking for the best deal. Shopping around for college won’t sound funny if teens have seen you compare price and quality for other important purchases. Try a free, non-biased resource like TuitionU.com to identify the best student loan rates for your child’s college choices.

8. Take a Test Drive
Encourage young children to explore careers early through "Shadow"€ or “Take your Child to Work”€ days. Facilitate conversations with friends and family members in fields of interest. Learning that architects also need to excel in math, computers and writing may be surprising to children who like to draw. Instead of just focusing on the glamorous side, teens can understand daily realities through thoughtful conversations with industry experts. Older teens can also explore internships at your company and other volunteer opportunities for a more in-depth look at careers before college plans are finalized.

9. Balance Emotional and Financial
Parents frequently see their child’€™s education as a measurement of their love or belief in a child’€™s potential rather than an investment in their future, with a debt that has to be repaid. Help them understand you want them to maximize their potential and income/lifestyle by understanding the role education debt will have after graduation. The more financially savvy a teen is, the lighter this emotional burden becomes. Help children look beyond beach-side campuses to; graduation and job placement rates. Cox advises his children to research entry-level salaries for their ability to pay-off the loans required to enter a desired career.

10. Use Free Online Tools
Most parents and student don’€™t know about the free online resources that can help make college and finance conversations easier. Take the time to become the expert in your own financial future. Try these seven resources to let your child compare different schools, see how likely they are to graduate and pay off loans, estimate salaries for different careers, and get a real glimpse at their future.

1. Create hypothetical post graduation budgets to see how debt will impact life after school.

2. Compare starting salaries on www.salary.com to help shape future career choices.

3. Research a school’€™s federal loan default rate, as an indicator of success in repaying debt.

4. Look at each school’€™s new net price calculator to get a better feel for the actual vs. sticker price. Or try the University of Phoenix calculator.

5. Compare each school’s four-year graduation rates, the percent of students who successfully graduate and in what time frame to help determine your chance for success.

6. Consider the value of a state university (as well as commuting if possible) vs. staying on campus.)

7. Shop around using a free resource like TuitionU.com to find the best/lowest rates for loans to fill the financing gap after you have exhausted" free money":http://www.greennote.com (grants, scholarships) and cheap money (federal loan program.)

While difficult, talking to children early and frequently about college, the costs and plans to achieve goals is an important responsibility for parents. Cox has been rewarded to see his own children’s financial savvy increase through consistent conversations and thoughtful involvement. As a parent and student loan expert, he encourages ongoing preparation so his teens can identify opportunities with the greatest return on investment in the future.