Paying for College

What's the best way to pay for college? There's no one answer. Each family has to find their own best way. Here are a few ideas that might help you find yours.

Investing in Education

Along with your home and car, a college education — yours or your child's — may be one of the biggest expenses of your life. But, it's also one of the best investments you can make. Among Americans (1) ages 25 to 32, median annual earnings for full-time working college-degree holders are $17,500 more than for those with high school diplomas only. Here are some tips to help you save for that investment.

Start Saving Early

The earlier you start saving, the better. There are lots of savings vehicles to help you get started, including 529 Savings Plans or Coverdell Education Savings Accounts. And at , we even offer Education Planning to help you maximize your savings. When your child receives cash gifts at birthdays or other milestones, put them straight into their college savings. If you can contribute even a small amount each month too, that's even better.

Choose Your School Carefully

Going to a public college can help save you thousands of dollars, especially if you go in your home state. You might want your child to go to a school with lots of name recognition, but remember that they can get a quality education at a more affordable college, too. Starting at a community college and then transferring to a more expensive school is another great way to save money.

Take Advantage of Scholarships

Make sure you apply for as many scholarships as you qualify for. It's an easy way to help defray the cost of college, whether it covers all of your tuition, or just the cost of books for a semester. If your employer offers tuition reimbursement for you or your children, be sure to use that, too.

Apply for Financial Aid

Be sure to complete your family's FAFSA (the Free Application for Federal Student Aid) completely and on time. It will let you know how much need-based federal aid you're eligible for. Schools will use it to determine your financial packages, so it's very important to fill it out.

Consider Taking Out a Student Loan

If after scholarships and financial aid, college is still too costly, it may be worth taking out loans to pay for the difference. Borrow no more than you absolutely need, and be honest with your child about how much they'll owe at the end — and whether you'll be able to help them pay it off.

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