College tuitions! How to fill the funding gap

Right now, millions of high school seniors are receiving acceptance letters and financial aid offers from colleges and universities. These offers usually include a combination of merit-based scholarships and grants, student loans, work study grants, and private parent loans. In past years, it was challenging to convince many schools to increase this aid. But according to author and college planning expert Ron Lieber, with the COVID-19 crisis reducing the number of applicants to most schools, parents are now in a better position to diplomatically ask for better offers. But this can be a confusing process. Parents need to negotiate scholarships and grants with the Admissions office, and loans and work study grants with the Financial Aid office. When meeting with these officials, parents should feel free to ask them to match or exceed the more generous financial aid offers their children have received from other schools. Even after students have accepted an offer, they should seek additional money by applying online for a share of the billions of dollars available through thousands of private grants and scholarships. Even with all this aid, parents’ share of their children’s annual college costs will still be significant. They should try to borrow as little as possible, particularly through private parent loans whose payback periods could last a decade or more. This is particularly important for parents who are approaching retirement age, since some of their Social Security benefits may be garnished if they’re unable to make monthly payments on their own. For parents with younger children, contributing to a 529 College Savings Plan as early as possible can give them a head start on building a reserve to help pay for future educational costs. Grandparents, too, can help by contributing to these plans or giving up to $15,000 a year per child without gift tax implications. The most important thing is to not let your fear about your children’s future or your guilt about what you’re able to afford keep you from making the right financial decisions.  

Om Podcasten

Whatever life after 50 looks like to you, thinking about money in retirement shouldn’t keep you up at night. We’re all dealing with the big questions about money and aging: How much you can really spend, how to invest your life savings without risking it all in the stock market, and should you sell your home and downsize? Then there’s the biggest unknown: how much health care you’ll need, and whether your savings and insurance is enough to cover the costs. This is personal. These topics may not be easy to talk about with your own family. That’s why nationally known personal finance experts Terry Savage, Richard Eisenberg, and Pam Krueger and are here to open up the dialogue so you can learn how to define your retirement and deal with your money on your own terms. These three friends think, write, and speak about these issues. And now they’re joining forces to give you the benefit of their experience, wisdom and advice in their new podcast, Friends Talk Money. Each week Richard, Pam and Terry will discuss a different piece of the retirement pie. Everything from Social Security and Medicare to investing and cash flow management is on the table, with practical, common-sense advice on how to deal with these and other challenges. But don’t expect cut-and-dried answers. These friends have strong opinions, and aren’t afraid to debate the pros and cons of their friends’ recommendations. But what you will walk away after each episode is a greater awareness of the retirement planning issues you’ll need to address with the help of your family, friends and financial advisor.