With one already in college, another one graduating high school this June and my third in two years, I know the pain you’re feeling! Hopefully you already have some funds set aside. I have been, for many years, contributing to my children’s 529 College Savings Plans. This plan allows you to save for college with the growth being tax free. You also get a Maryland tax deduction for contributions up to certain limits. Some also save through personal investment accounts that are not in 529 plans that may result in taxable income to get access to the funds for education. If you do not have the funds set aside and have to find them somewhere else then you probably will have to look at loans. Before doing that, I would suggest doing a thorough look at all the scholarships available to help mitigate the cost of school. There are many scholarships available that may help. Also make sure you take advantage of Pell Grants and student-loans that are available to you. Many have used the home-equity lines on their homes as a source of funds for college as well. The advantage is that the interest would be tax deductible and right now interest rates are low. The biggest problem right now for this strategy is that with the decline in home prices, many do not have enough equity left to meet their needs. In addition, if interest rates go back up, then their costs of the loan will go up with them. Good luck!

There are numerous different strategies that parents and students should consider when it comes to paying for college expenses. Many families are learning that even though they have saved money over the years, college expenses have increased so substantially that they must find other means for obtaining the funds necessary. Begin by completing the Free Application for Federal Student Aid (FAFSA) or the CSS profile (typically required by private colleges). Follow that by understanding how financial aid works and the different types of scholarships and loans available. Grants are scholarships that are a gift and do not need to be repaid. They may be needbased (financial need), a meritbased reward for an excellent academic record, athletic prowess, musical talent, etc., or an employment benefit that the parent's employer offers. Loans, must of course, be repaid. Stafford and Perkins loans for students and some loans from charities are typically offered at lower rates than commercial loans. PLUS loans are available for parents but often a loan from a bank is a less expensive alternative. One additional option to consider is attending Frederick Community College for the first two years. Typically the course work will be identical, class sizes are smaller than at a large university and tuition costs are low. There are also numerous scholarships available for students who do well academically during those two years that will help them to subsidize the following two years at a four-year college or university.

Have a nice dinner together to celebrate the fact that all of you have successfully completed 12-plus years of school. Kids, hug your mom and dad and thank them for putting you in the car seat kicking and screaming to go to Pre-K, making your lunches, forcing you to get that homework done, buying those prom dresses … you get the point. And parents, hug your kids and pat each other on the back for doing such a great job over the last 15 years or so. Now, if you have saved properly for college, you shouldn’t have any worries (other than the accounts possibly being lower because of the market downturn). However; if you didn’t save enough, or at all, you need to get busy and start looking at all of your options, which are too numerous to list in my column. A great place to start is www.collegeanswer.com. At this site you have access to calculators, information on financial aid, savings plans, scholarships, etc. Also, you can check www.kiplinger.com, along with many other Internet sites that will provide you with vast resources; and hopefully, help you narrow your options to the one that makes the best sense for your family. Again, congratulations and good luck going forward!