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College Loan

By Terry Savage on June 01, 2021 | College Savings / Student Loans

We have about $200K saved up in 529 Funds for each of all 4 (50K per child) of our children. Our oldest is graduating this weekend and ended up getting accepted into Northwestern, which is great but we are also worried financially because this is above what we thought we would be paying for college. We have roughly $50K for her in 529 funds which we felt would give here a good start.

In addition, we currently pay for private high school and grammer school for our children as well which is roughly $50K per year. 15k of that 50K will come off next year due to our oldest going to college so we can potentially apply that to the 50K from the 529 funds to get her through the first year.

My question is, what is the best place to start to look into a student loan for her and should we use up all of our money the first year or get a loan now and do a little from the loan and our own funds each year to find a balance to pay for 4 years of Northwestern? Thank you

Terry Says

You need to read Ron Lieber’s new book, The Price You Pay for College, to get some overall perspective on this issue. You have taken on quite a challenge paying for private secondary education and college for four children. And yes, $50,000 is nowhere near enough to provide an education at a top school like Northwestern.

You need to come up with an overall plan RIGHT NOW — before your first starts college. I can direct you to some great websites like www.Finaid.org to learn more about the costs — and consequences — of student loans. But in order to be fair to all your children, please read Ron’s book first and immediately. It will show you perhaps how to get a tuition break for colleges, and how to consider alternatives as part of an overall plan.

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