What about financial aid?
If you are a strong candidate and can show some financial need, you CAN attend the college of your dreams, even the selective ones. How is that possible? Colleges today will do whatever they can to tailor a financial package that you can afford. Some of the money may be in the form of grants, scholarships, campus employment, or loans (in many cases, to be paid back after you graduate). Today, it is a myth that only the poor receive $$ aid! (State colleges, however, have less money to give than private colleges, so sometimes you can attend a private college at state college prices.) Also, the federal and state governments are funding public colleges less and less each year.The guidance counselors at TVHS recommend that you fill out the profile and establish a financial aid account on: http://www.fastweb.com/ .
What is FAFSA (Free Application for Federal Student Aid)?
FAFSA is an application for all college applicants that determines each student's eligibility for all federal aid programs and for most state and collegiate based aid programs. FAFSA applications can be gotten from the High School Guidance office or on the web at http://www.fafsa.ed.gov . Once you receive your application, it should be filled out and filed as soon as possible online after January 1st of the year that the student hopes to be a college freshman. In this case, the early bird does get the worm!
For completion of the application you will need to collect information about gross income, previous year's taxes, untaxed income (ex. child support), checking/savings accounts, net worth of investments, net worth of businesses, and student income. If you have this information readily available before you begin, the application process will move quite quickly!
About College Savings ¾ the 529 Plans
There are some opportunities today for college savings that did not exist a few years ago, thanks to the Economic Growth and Tax Relief Reconciliation Act of 2001, aka the College Savings Act plan or 529 plan. The new 529 plans make it much easier for parents to finance higher-education than any other programs thus far, by substantially raising the amount parents and grandparents can contribute to education accounts. There is virtually no limit to the amount you can invest annually. Here's another advantage ¾ you can buy into any 529 plan, regardless of the state sponsoring it! In other words, you can shop around. Also, you can have an education IRA plus a 529 plan, simultaneously contributing to both. One reason for doing this would be to use the 529 as the major college savings plan and the IRA to cover incidental costs at college (books, etc.).
There is one major drawback. Since 529 plans are held in the name of the child, not the parent, colleges will count the money as an asset toward the "expected family contribution." This may mean less money offered to your child in the form of grants and aid. You will have to decide whether the tax break is worth the loss of potential grant money, especially if you are really counting on grant/aid money. Alan Poisch, head of Educational Consulting and Tutoring in Albuquerque says, "It's always better for financial purposes to keep money under the parents' names." You see, colleges use computations which expect that half of the child's annual income will be used to pay college costs.
Here's another drawback ¾ with a 529 plan your investment options are very limited. Also, it becomes very difficult to transfer money into another fund later on. IRA's, on the other hand, offer more investment options and greater ease of management.
And here's what I see as the fatal flaw ¾ there is no guarantee in the way the law is currently written that funds needed after 2011 won't be taxed! The money is non-taxable (federal) between 2002 and 2011, but nothing has been written to protect withdrawals made after that date!
The 529 plans may not be the solution for the young person applying to college in the coming year, but if you will be facing more college tuitions in the years to come, you might want to do some investigating today.
Among the best plans so far are those from Iowa, Michigan, New York, and Utah. To track the success of the various 529 plans, log on to savingforcollege.com
From an article in Time August 21, 2006
Don't forget that embedded in some our large public universities (like Penn State), there are honors colleges. It's a fact that our students can get an Ivy League education there for a reasonable tuition. The point is this: your child does not have to go to Princeton or Yale, and you don't have to re-mortgage your house!
Note: Harvard, Yale, and Stanford provide free tuition and room and board for families whose income is below $40-45K ... if the applicant can pass academic muster. And, though we haven't seen it here at TVHS yet, the Ivies are reaching into low income and rural areas for about 30% of their student body these days. Still, these colleges are so inundated with applicants that they are turning away as many as 4 out of every 5 applicants, so, financial breaks notwithstanding, it's still tough to get into an Ivy!
If not an Ivy, then where? Consider: there are wonderful small liberal arts colleges (Lebanon Valley, Dickinson, Muhlenberg, Moravian, Albright, Lafayette, for example) that can provide a much more personal education than the Ivies can ... often for much less because as their endowments rise, so do their academic scholarships! This is great news for our students.
Adopt this as your new college mantra: "College is a match to be made, not a prize to be won." Suggested reading, Looking Beyond Ivy League by Loren Pope.
What about earning potential if a student goes to a less prestigious school? A study conducted in 2002 reveals that when both groups (the Ivy graduates and the less selective college graduate) were earning about the same twenty years later! For example, only 7 CEOs in Fortune's top fifty are graduates of Ivy League colleges.
What about getting into graduate school after college? It turns out that those who attend small private colleges fare very well when it comes to getting into the choice graduate programs!
The lesson for our brightest students? Seek out the smaller quality private or larger public college, get a good academic scholarship there or enter the honors college program, and then go to aresearch university for graduate studies (the Ivy League schools or similar). Here's an example: 52 pre-med students went to the U. of Maryland/Baltimore campus on Meyerhoff Scholarships (fully paid grants) and every one of them was accepted to a premier graduate school for medicine in 2005.
The New Ivies
With so many students attending college, the opportunities for a first class education is increasing for our brightest students. Here is Newsweek's 2007 Guide:
•· Boston College, Chestnut Hill, MA
•· Bowdoin College, Brunswick, ME
•· Carnegie-Mellon, Pittsburgh, PA
•· Harvey Mudd College, Claremont CA
•· Pamona College, Claremont, CA
•· Colby College, Waterville, FL
•· Colgate, Hamilton, NY
•· Davidson College, Davidson, NC
•· Emory Univ., Atlanta, GA
•· Kenyon College, Gambier, OH
•· Macalaster College, St. Paul MN
•· U. of Michigan, Ann Arbor, Michegan
•· NYU, New York
•· U. of North Carolina, Chapel Hill, NC
•· Olin College of Engineering, Needham, Massachusetts
•· Reed College, Portland, Oregon
•· Rennsalaer Polytechnic Institute, Troy, NY
•· Rice U., Houston, Texas
•· U. of Rochester, Rochester, NY
•· Skidmore College, Saratoga Springs NY
•· Tufts U., Medford, Massachusetts
•· UCLA, Los Angeles, California
•· Vanderbilt U., Nashville, Tennessee
•· University of Virginia, Charlottesville VA
•· Washington U., St. Louis, Missouri
Note: To find a good college by major, refer to Rugg's Recommendations on the Colleges, Frederick E. Rugg. This book is amazing because every school listed is an outstanding school. Schools are sorted by enrollment size, Schools are listed as Most Selection, Very Selective, and Selective.
The Case for the Public Ivies
The following are America's so-called "flagship" Ivies:
The College of William and Mary
Indian University (in Indiana)
Miami University ...in Ohio, of course J
Penn State University, Michigan State, Ohio State, and Rutgers (state university of NJ)
Universities of NY, California, Colorado, Connecticut, Delaware, Florida, Illinois, Michigan, North Carolina, Texas, Vermont, Virginia, Washington, and Wisconsin
Did you know that 66% of all college students attend public universities? Cost is clearly a big factor!
** Many thanks to Elaine Troisi, Gifted Program Director for Twin Valley School District for this valuable resource.
