As we move into spring 2023, many students will choose which college they’ll attend in the fall. For parents, there are plenty of questions and concerns about the college process, especially when it comes to cost, scholarships and financial aid.
College Ave Student Loans recently completed a survey to get some insights into parents’ stress, concerns and priorities for affording their child’s college education. Read on to see six surprising findings from this study to help parents set their students up for future success.
1. College costs are higher than parents expected
Three-quarters of parents said college costs are more difficult to cover than in previous years and 71% found the actual cost of college surprisingly high. Also, parents often felt that college tuition, fees and room and board were more than they initially expected. Perhaps this is why one-third of parents said their child attended a school outside their original budget. Starting conversations with parents whose children are currently in college can help set expectations about affordability.
2. Fill out the FAFSA and unlock free aid
While 9 in 10 parents did fill out the FAFSA this year, a majority (61%) found the form confusing to complete. To help cut through the confusion, have all your documentation ready, and talk to other parents who have recently completed theirs.
It’s free to apply for the FAFSA. Even if you think you won’t qualify, it’s worth filling it out. Your family may qualify for merit aid (money that does not need to be paid back), and at a minimum, federal student loans, which offer unique benefits, such as income-driven repayment plans, over private student loans.
3. How families find scholarships
There are several ways students and their parents can apply for scholarships, but they may not know about all their options. According to the survey, 30% of students received scholarships and grants as part of their school’s financial aid package.
Families have also found and received scholarships through the help of a college counselor or the financial aid office, an online scholarship search, a high school counselor, community or local organizations, friends and work. While these methods were used to a lesser extent, they do provide more ways to pay for college.
If you want to help your incoming first-year students search for scholarships, you can use online tools like Scholarships.com.
4. Perceptions of financial aid award letters
When financial aid letters arrive in spring, many parents found the letters easy to compare. However, 74% of parents who received letters found that the expected family contribution to their children’s education was higher than expected.
It’s likely that because of this higher-than-expected contribution that families have to seek multiple ways to finance their student’s education, from income and savings to scholarships and student loans.
5. Preparing students with financial life skills
Before heading off to college, you should make sure they have the necessary life skills to live independently. According to the survey, parents confirmed that their students had accomplished several skills before college, such as cleaning, preparing meals and working a job.
The most common was opening a checking and/or savings account (85%).
However, it seems that many students could practice other important financial skills. For example, only 48% had paid a bill, 26% had balanced a budget and 24% understood investments. For parents of soon-to-be college students, it’s critical that you help your children brush up on their financial skills before they start their classes in the fall.
6. Advice from parents to parents
Parents who have already sent their kids off to college have valuable insight into the process. They recommend parents of incoming freshmen encourage their children to apply for more scholarships, fill out a FAFSA application, and be prepared for unexpected college costs.
Make a plan to set up your student for success
Even after a combination of savings, scholarships, grants and financial aid, students and their parents may find that they can’t cover the full cost of tuition. To bridge the gap, you may need to consider student loans.
Using tools like the College Ave student loan calculator, you can estimate your future monthly payment and an easy-to-understand breakdown of the loan amount, repayment terms and interest rates.
If you already have children in college and took out student loans, see how much you can save by refinancing a student loan using their student loan refinance calculator. To learn more about private student loans and other college finance tools, click here.