Paying For College: Penalty or Platform?

Recently, I attended a community event that involved sitting down to dinner with several people I had just met. Sometimes when asked, I hesitate to tell people exactly what I do for a living because inevitably the other person tries to turn the rest of our conversation into their own personal consultation session. Bracing for rapid-fire questions, I introduced myself to the gentleman next to me and the woman next to him.

But when he heard my job title, he immediately blurted out “I think it’s stupid that those who have worked hard to save for college are penalized the most in the financial aid process.” Groaning a bit, I contemplated my response, but before I could formulate it, the woman next to him eagerly chimed in with her own experiences. Quickly realizing that they were not really looking for my expert opinion on the matter, I graciously excused myself from the conversation to let them continue in their commiseration.

It was not the first time I had heard this sort of reaction though, so I wanted to get some answers of where the feeling comes from, and of course find solutions for anyone feeling helpless. I do find that it’s more of a sentiment on their unique perspective rather than a blanket statement of what most people can experience to be true. You see, my dinner companion was not entirely wrong in a certain sense because the government calculating your eligible assets at face value does play a major role in the process. Undoubtedly, those with extensive cash opportunities are presumed to have the means to pay for college, and the financial aid system is largely set up to weed them out.

What the government (and colleges) will not necessarily interpret though, is your family’s full or partial intention (or ability) to actually use those means to foot the entire tuition bill. Use that assumption instead as your starting point, when you consider what you are actually able or willing to pay for higher education. And what it comes down to then is a mix of your starting point and your willingness to make a plan you can stick with. Is saving for college truly a penalty, or can it be a platform?  What I gladly would have explained in this scenario, had I been asked, is that each of the aspects of college savings, application, and financial aid, are unique for each family and student. So the best way to “save for college”, is to devise a strategy including all three of those and set your family up for the most success.

According to research released by the National Student Clearinghouse, undergraduate enrollment has seen a steady overall decline now for several years. At the same time, both college tuition prices and available financial aid have gone up, but more people fear the trend of being consumed by debt after college and are opting-out of the whole endeavor. Paying for college can feel like an unfair game, with mysterious strategies, that nobody seems to be winning. I certainly understand that feeling, but finding a solution that works for you may not be as difficult as you’d imagine.

Likely the easiest solution, though, is to start early. Meet with a College Funding Advisor and tailor a plan to your family’s needs. Consider the actual costs of what a four-year college term would look like, before any applications are submitted, and what you can do about it. Students can also get a head start on researching colleges and making sure they’re meeting certain requirements (to apply, to pay, but also to graduate on time with a viable career path). Then you can find how the financial aid process can work for you, instead of you working for it. If you don’t have that luxury of time anymore, all hope is not lost, but you’ll instead need to find a little flexibility in your expectations, and some extra diligence to seek out opportunities.

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