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Making College Affordable: Crafting a Financial Plan with Your Graduate

Updated: Jun 11, 2024

When it comes to covering college costs, each family's situation is unique, and there's no one-size-fits-all answer. However, there are countless reasons why parents might consider shouldering the full financial burden of their child's education if they have the means to do so. Yet, it's equally important to recognize the value in students having a stake in their own educational journey. Given the country's deep divide on student loan repayment and forgiveness, it's a good idea to discuss with your future college student how to minimize the need for student loans and explore the available alternatives. 

For parents who are financially able to cover the cost of their child's college education, the question of whether they should may arise. While funding college entirely can undoubtedly be seen as a generous act, involving students in contributing financially can be an enriching experience. It's an opportunity for young adults to learn essential financial lessons and gain real-world skills that will serve them well beyond their academic years. 

Moreover, finding a balance between parental support and student responsibility is key. Hybrid approaches, where students contribute in some capacity, not only alleviate the burden of student debt but also impart valuable financial wisdom. 

But how much should parents contribute?   This is a deeply personal decision that varies from family to family. Some parents may opt to cover the entire cost, ensuring their child can focus solely on their studies without the worry of financial strain or student loans. Others may choose to involve their children in the financial aspect, teaching them the importance of fiscal responsibility and decision-making. 

There are numerous ways to incorporate student contributions without overwhelming them with debt. From setting a flat dollar amount and letting students decide where to attend, to requiring a financial contribution each year, these strategies encourage students to take ownership of their education while fostering a deeper appreciation for the value of money and hard work. 

Performance-based incentives, such as maintaining a certain GPA, can also motivate students to excel academically while reinforcing the importance of dedication and commitment. Additionally, parents can consider having students cover specific expenses, like discretionary spending, to teach them about budgeting and the true cost of living. By instilling these financial principles early on, students are better equipped to navigate their future financial endeavors. 

And for parents who may not be able to cover the full cost of college, there are still options available to help bridge the gap. Whether through parent loans, unsubsidized loans, or student employment, applying for scholarships and grants, there are avenues for students to take an active role in financing their education. 

Ultimately, communication is paramount in navigating these decisions. By openly discussing financial contributions and the reasoning behind them, parents can empower their children to make informed choices and develop essential life skills. Whether parents choose to fully fund their child's education or involve them in the financial process, the goal remains the same: to provide them with the tools and knowledge they need to succeed in both academia and beyond. 

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  At Colmina, we take our clients’ goals to heart. We have built a community centered around the well-being of those we care for. Our fiduciary basis ensures our decision-making is always in the best interest of our clients. No matter the twists and turns of the financial market, our advice will adapt to match so that your plans can stay true to the course.  

 

Our commitment is to earn and maintain the trust of our clients, exemplified by our dedication to crafting customized plans and delivering valuable advice that aligns with your family’s goals. 

 

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