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Choosing & Paying For College: Things to Consider

For all of you entering college for the first time this month, and for all you seniors leaving high school this spring (including mine!), this is for you! We know you’re feeling the pressure of not only choosing where you will go to college, but what you’ll pick to major in. These decisions would be daunting at any age, but at 18, well, it’s a lot. I know many of you will say you’ll go to whatever school will have you and give you the best financial package, but let’s take a step back for a moment and talk about a few personal development questions. 

Determine your soft skills

I personally think it’s incredibly important to determine what your soft skills are and what you’d really like to do for a career (or at least narrow it down!) before you pick out what college you’ll attend. Many parents I work with are quick to say their child will go to college just as they did, but then when I ask what that parent is currently doing, it has nothing to do with what they went to school for. (This includes me, by the way, although I always knew I wanted to work in the financial world.) These parents think of college as where they learned to be accountable, share living space, show up on time and generally grow up. 

Decide what you want to do with your life

While these outside-the-classroom skills are important, it is also important for students to ask themselves, “What do I actually want to do in life, and what degree or advanced education does it take for me to provide myself with that opportunity?” It’s crucial to consider these questions, because your individual answers can help you decide what level of degree you need, whether two-year associate’s, four-year bachelor’s, or beyond, and whether you choose a liberal arts college, large state university or a business school. There’s a big difference in educational needs between people who want to go into the non-profit sector, teach elementary school, or become electrical engineers. 

Once you’ve narrowed down what you’re good at, what you truly enjoy, and what careers you might want to pursue, then you can make a better informed decision about whether student loans make sense for you, or if other options would better suit your needs. 

What to do if you’re not sure what to do

Perhaps the results of this contemplation is that you’re still not sure what you want to do. That’s okay. There’s nothing wrong with taking a couple of years to work and gain experience while you continue to ponder your future. You just might find your passion, even if you’re living on the poverty line working odd jobs. Believe me, we’ve all been there – we knew we were broke, but we never felt poor, because these were all just steps in this adventure we call life. 

I frequently recommend to my clients that they have their children take aptitude or personality tests as they near the end of high school. These kinds of tests can help create the short list of possible careers and school choices, and keep kids from taking on excess debt for courses they’ll never use. That money could be used for travel or other life experiences. In my family, we always said traveling, especially internationally, was the best form of education. 

Find the right school — and financial package

Let’s say you and your family do determine that a four-year degree is the best plan. Then it really does come down to finding a school that fits both the personality and academic goals of the student, and that has the best available financial package. As you’re making these decisions, I strongly encourage families who plan to take on student loans to discuss how that debt will be paid back and by whom. Don’t wait for the bill to come due (and don’t count on government forgiveness). Whether parents plan to help out or the child is on the hook for all of it, make that decision now so there are no surprises later.

And if loans are the road you choose, make sure you understand this kind of debt so you’re clear about what you’re taking on. It’s common these days for graduates to come out of school with $50,000 or more in student loans. Those loan payments could be equal to those for a new house or car, so take that on with eyes wide open. It’s easy for students to simply go into the financial aid office and sign the forms without fully understanding what they’re signing up for. 

Whatever path you and your family determine is the best, the key is to have the conversation and make decisions up front. 

Article by David Smyth, Senior Partner at Family Financial Partners — a financial services firm in Lexington, Kentucky.

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