College Finances

As the cost of college continues to rise, affording tuition can be one of the most difficult tasks for students and their families, but the good news is there are plenty of options.

“My recommendation, the first stop for a high school student is the high school guidance office. The guidance office receives brochures and flyers from not only colleges and universities, but private agencies and what we call external scholarships. That’s always the first stop. Today of course: the Internet. One can simply Google college scholarships and find all sorts of scholarships,” said Earl Dowling, Vice President of Student Affairs at College of DuPage.

Whether you’re still in high school or looking to continue your education, Dowling suggests making a list of any organizations or clubs that you or your family are a part of and reaching out to them.

“We want every student to apply for everything. And yes, it’s going to require some time and effort, but if you pick up 100 here and 100 there, you’ve paid for a book or two. So yes, take the time, do the research and the timing is right. Now is the time to be doing that,” added Dowling.

And the time to start saving for future college plans is now. According to financial advisor Sean Bradshaw, it’s never too soon.

“I would say if you have children now and you’re not saving for college, you want to consider starting that next month. The idea is building a habit, building a lifestyle, and once you’re getting used to that, doing something automatically,” said Sean Bradshaw, Financial Advisor at Edward Jones.

Even if you’re considering children further down the road, it doesn’t hurt to open an account and get a head start as college tuition continues to inflate.

“So if you take the cost of University of Illinois tuition and room and board right now, it’s about $28,000 a year. If you look over the last 20 years, the inflation has been about 4 percent a year. So if you picture a child born last month, and we take that over the next 18 years, the cost of the University of Illinois for four years now is about $112,000, in 18 years you’re looking closer to $240,000,” said Bradshaw.

A useful tool for saving is a 529 plan, which is sponsored by the state. The money can grow long term and when used for education, isn’t taxed at the federal level.

And if you’re late to the investing game, there are short-term benefits as well.

“But one of the things you can do is you can contribute to a state 529, you can get the tax deduction, which at the full contribution $20,000, would be a $750 return back to you at tax time. But you don’t have to invest it. You can put it in the plan, put it in money market, pay your tuition through that, and each year that you do that you get $750 back,” added Bradshaw.

Every small saving can help contribute to a larger investment in your future.

Naperville News 17’s Rachel Pierson reports.

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