I’m pleased to have back a very special guest Wendy David-Gaines, blogger and author for Parents of College-bound Students (POCS). Today she will be hitting on a crucial issue – the college affordability talk between parents and their college/grad school-bound students. Take it away, Wendy!
There are two dreaded topics parents must discuss with their children that strike fear into both of them. These are the famous birds and bees convo and the college cost talk.
When teens are preparing for higher education, it’s time to chat seriously about money. However, parents can’t expect a meaningful talk about college finance if students don’t understand the concept of affordability.
Before tackling the issues of money management, budgeting and banking, parents and students need to share their views about how paying for college will impact their future finances. Here are four major points to consider during the college affordability cost talk:
For what it’s worth Unless a degree is earned in a timely manner, costs are going to escalate. Affordability is tied to commitment and dedication to complete college no matter the source of college finance. The money often comes from federal and state financial aid, institutional funds, scholarship awards from private sources and cash contributed by the family. Parents and others may help but students must be vested in the process or they lack incentive to do their best.
Truth in lending Most families must borrow to purchase big ticket items like houses, cars and higher education. The problem is when debt accumulates to the point of financial inability to repay. Although there are education loans for students and others for parents to take out for their child’s education, there is no loan for retirement. Before borrowing, both parents and students may project expected monthly repayments to see what they can each afford.
Theory of relativity As strange as it may seem, many high earners cry poverty. That’s because affordability is not about how much money a person has but how much is left after paying expenses. Parents may suggest their student project their future wages and compare it with their desired lifestyle to keep their college and beyond goals realistic.
Declaration of independence True financial independence is achieved when adult children are self-supporting. Parents must be frank with their children about how much financial support they are willing to contribute now and in the future. Like sponsors of grants, scholarships and loans, parents should also disclose strings attached and under what circumstances, if any, funds are to be repaid. This way, before acceptance, students will be able to decide if they can afford their parent’s terms.
The college cost talk is most effective in the context of affordability. It’s important for parents and students to consider their own positions, communicate their views and continue the dialogue.
Wendy David-Gaines, aka POCSmom, provides information and insights about the parent role in the college process to make it less stressful and more fun for the college-bound and their families. She is founder of POCSmom.com, author of Parents Of College Students survival stories, and Long Island mother of two children who have graduated from college with self-supporting jobs. She is the Long Island College Prep Examiner for examiner.com.