(StatePoint) If you’re the parent of a college-bound student, you’ll soon be receiving financial aid award letters. Making sense of these letters and planning your next steps can help you navigate the years ahead.
Among the nearly 90% of parents in a College Ave survey who say they helped or planned to help their child pay for college, 68% were confident they had a good payment plan. To help ensure you can say the same for yourself, it’s really important to nail down the details. Once the financial aid award letters arrive, Angela Colatriano, chief operating officer at College Ave, says to take the following steps:
Compare the offers. Each letter might present information a bit differently. Getting an apples-to-apples look at the offers is critical. You can calculate the net direct cost of each school by subtracting offered scholarships and grants from the cost of attendance (tuition, room, board, textbooks and fees). If applicable, you can subtract work-study aid too. You should also factor in expected annual increases in tuition, room, board and other fees.
Understand how federal borrowing has changed. The One Big Beautiful Bill (OBBB), signed into law last year, brings important changes to federal financial aid. While some provisions expand flexibility, including Pell Grant use and student loan rehabilitation opportunities, it also places new federal loan limits on parents and graduate students. Families who might be considering federal loans to cover remaining costs may need a new approach and funding plan. It’s important to be mindful of these new changes and annual borrowing limits so there are no surprises down the line.
Look for more scholarship opportunities. Beyond federal and institutional financial aid, outside scholarships can help you meet college costs. Ask your student’s high school counselor and visit online sites like bigfuture.collegboard.org and scholarships.com to find relevant opportunities. One easy and simple scholarship your student can apply to again and again in mere moments is the College Ave Scholarship Sweepstakes, which awards $1,000 to a lucky winner each month.
Cover the gap. If there’s still a gap after financial aid, savings and income, and federal loans, consider private student loans or private parent loans. If your family does borrow loans, be sure that your student has an understanding of how loans work, so they are prepared for their monthly payments once repayment begins. You should also compare rates and terms and prioritize lenders with good customer service. To run the numbers ahead of time so you can borrow smarter and with more confidence, use College Ave’s student loan calculator found at collegeave.com/calculator.
“Taking the time to carefully compare all your options, then moving forward with a well-considered plan can make this exciting time less stressful and more joyful,” says Colatriano.
Photo Credit: (c) Miljan Živković / iStock via Getty Images Plus
