Families are often concerned about the cost of college, but there are many tools to help families be prepared. Money spent for higher education is an investment in the student’s future. According to the U.S. Bureau of Labor Statistics, the more education a student has beyond high school, the higher his or her future income is likely to be.
However, few families will have money in hand to pay the entire cost of college for a student. The good news is that few families are expected to cover the full cost; most will be responsible for only the portion of college costs they can reasonably afford, which is determined by using standard financial aid formulas. The Expected Family Contribution (EFC) is reported when a family completes the Free Application for Federal Student Aid (FAFSA).
Fortunately, there are many different options to help families come up with their share of college costs.
A 529 account is a great saving tool for college because the earnings on these accounts are free from federal, and often state, taxes, when money in the account is used for qualified higher education expenses. These expenses can include tuition, room & board, books and electronics. Most states, including North Carolina, offer 529 Plans.
Scholarships and Grants
Scholarships and grants are a particularly good option to help with college because they generally do not have to be paid back. Grants are available from both the federal and state government if the family has financial need. For example, the U.S. government makes a Federal Pell Grant available to students with families making below a certain income threshold. North Carolina also has grants available for North Carolina residents who attend universities and colleges in North Carolina’s UNC system, NC community college system, and NC independent colleges and universities.
Applying for scholarships is another possible way to get “free” money for college. Colleges to which you apply often offer scholarships based on talent, ability, leadership, need or other factors. There are also scholarship websites, civic organizations and private businesses that may have scholarships available. Some scholarship applications require essays, evidence of knowledge, skill or ability in a particular area or certain personal characteristics or goals. Tools at CFNC.org and http://studentaid.ed.gov can help you begin searching for scholarship options.
Another way to help pay for college is to take advantage of work-study jobs that are available on your campus, to work part-time off campus if you can fit it into your schedule, or to find summer work to help with college expenses during the academic year. You may even be able to find internships in your major field of study that pay a stipend or hourly rate. Studies show that working 10-15 hours a week while in school may help you budget your time and even do better in college, but working more than 20 hours a week can be a negative.