College can be overwhelming yet exciting for both students and parents. Proper planning and financial preparation are essential when making the transition into college. With the growing financial demands of college tuition, we have compiled a list with some advice to help you prepare for the economics of higher education.
- Be honest about the cost of college and effects of long- term debt.
As your child enters their teenage years, you can begin to deepen the discussion about college savings. If your teen is working a part-time job, then they will have a much better understanding of the value of a dollar. Talk to them about how debt can follow someone long after they have completed their degree.
- Create a mock budget
Create a mock college budget that include the costs of tuition, housing, and other expenses. Show the differences between state colleges and private colleges. Map out the difference between living at home and living in a new city or on campus. From there, a decision can be made on which college is best to attend.
- Educate yourself on tax implications
Tuition payments made to secondary education institutions may qualify for tax credits or tax-deductible status, depending on individual circumstances. Furthermore, in addition to tuition deductibility for dependents, you may also qualify for a deduction of interest paid on student loans. Whether you file a credit or a deduction, a tax professional can help analyze your individual situation to ensure that you are maximizing all the options that may be available.
At Mooney Lyons, we can help you ask the right questions and prepare yourself and your child for what lies ahead. Utilizing our Integrated Wealth Model, our experienced advisors get to know you on a personal level in order to deliver results both now and in post-collegiate years. Contact us TODAY to schedule an appointment!