The Basics of Choosing an Affordable College Education

Whether you’re thinking about your children’s education or going back to school yourself, here are the main points of interest you need to navigate as you map out the basics of your college financing options.

If your children are young, you’ll want to consider dropping some money in a college savings plans such as a 529 plan. Most U.S. states—as well as many colleges and universities—sponsor this type of savings vehicle.

A prepaid 529 plan essentially allows you to pay your desired in-state school’s tuition at today’s rates, while a savings 529 plan gives more flexibility in what you can invest in and which colleges you can attend with the money you’ve accrued.

For older students, look at the cost of their preferred degree vs. their expected salary to help them understand what size loan would be affordable. Doing this research before you borrow can give you a sense of what your post-graduation cash-flow will look like while you’re repaying your debt.

Once you know the size of student loan payments you’ll be expected to make, you’ll understand the true price of admission.

Keep in mind that a graduate degree will expand your opportunities—and your debt. And since interest rates can be different for undergraduate and graduate loans, the overall expense may be more than you can comfortably manage.

When applying to college, you have lots of choices. As you compare colleges, look at the cost of tuition and other expenses at different schools. Consider your earning potential and how long it would take to pay off your student loans to find the right option for you.

Don’t rule out community colleges, which can offer an excellent education at an affordable price, and your credits typically transfer to other schools.

Now that we’ve mapped out some basics, make your next stop our College Loans resource page, where you’ll find tips and solutions on paying for college. Your education is important, and NEA Member Benefits is here to help you on your journey.