College Affordability Solutions Topical Index

This index links to almost 90 articles. Each describes an wat to make college more affordable. Use them to learn how to do this before, during, or after college

And don’t forget! On August 15, 2018, new articles will be posted here every Wednesday.

Before College

College Finance Plan

Cost Reduction Strategies

College Costs

College Search and Selection

Credit Cards

Deadlines

Dependent and Independent Students

FAFSA (Free Application for Federal Student Aid)

Financial Aid Application Processes

Financial Aid Offers

Grants

Money Management

Parent Borrowing

Private Student Loans

Saving and Investing for College

Scams and Rip-Offs

Scholarships

Seeking Financial Assistance

Student Loans

Tuition and Fees

Value of Postsecondary Education

Verification

During College

College Finance Plan

Cost Reduction Strategies

Credit Cards

FAFSA (Free Application for Federal Student Aid)

Financial Aid Offers

Grants

Money Management

Off-Campus Housing

Parent Borrowing

Private Student Loans

Scams and Rip-Offs

Scholarships

Seeking Financial Assistance

Student Loans

Tax Benefits for Higher Education

Working While in College

After College

College Finance Plan

Consolidation and Refinancing

Debt Forgiveness and Cancellation

Grace Period

Missed Payment

Repayment of College Loans

Repayment Assistance

Repayment Problems

Tax Benefits for College Loan Repayment

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Special Bulletin: Your College-Related Tax Breaks Survived a Congressional Move to Eliminate Them

In November College Affordability Solutions urged you contact your members of the U.S. House and Senate in opposition to certain provisions within the House tax bill that was then working its way through Congress.

That bill was supposedly designed to cut taxes. But it would have done away with IMG_0428deductions and exemptions that reduce taxes for you and other students and parents by over $18 billion a year — money that helps pay college costs.

The original House bill was remarkably partisan. It was written by Republican House members without input from Democrats, and it got 227 Republican votes but no Democratic votes

Fortunately, the Senate also opposed eliminating college-related tax deductions, exclusions, and exemptions. It made sure they remained unchanged in the final bill, which is now law. So don’t ever think your voice doesn’t matter — constituent pressure clearly helped preserve these tax breaks!

Here are the college tax benefits that were preserved in the final bill:

  • If you’re a student, you still won’t be taxed on money you use from your College Savings Bonds to pay your educational expenses.
  • Parents, you may keep on making deposits into your Coverdell Education Saving Accounts to build up money for college.
  • The first $5,250 you use from your Employer-Provided Educational IMG_0429Assistance program to pay higher education costs will continue to be untaxed.
  • The Lifetime Learning Tax Credit remains unchanged. So you may keep reducing what you’ll pay in federal income taxes by up to $2,000 a year based on what you spend on tuition, required fees, books, and supplies for any student (including you) taking courses to get a degree or improve job skills.
  • The Scholarship and Fellowship Exclusion will continue to omit from federal taxation what your scholarships and fellowships pay toward your college costs.
  • Borrowers, you’ll still be able to claim your Student Loan Interest Deduction of up to $2,500 for student and/or parent loan interest you pay each year.
  • Your $4,000 per year Tuition and Fee Deduction remains unchanged.
  • Are you or will you be a graduate student? If so, any Tuition Reduction you receive in connection with a graduate assistantship or fellowship still won’t be subject to taxation.

Congratulations on keeping these benefits! But stay active and alert. More bills impacting college affordability will come before Congress soon.

Contact College Affordability Solutions by calling (512) 366-5354 or emailing collegeafford@gmail.com.

Special Bulletin: Now Ask Your Senators to Preserve Your College Tax Benefits!

The U.S. House of Representatives recently passed its tax bill. This bill would repeal many of the higher education tax benefits on which millions of college students and parents rely. But it isn’t law yet.

The U.S. Senate will soon act on a similar bill. But as currently written, the Senate’s bill IMG_0078would keep the House-targeted college tax benefits in place and unchanged. These benefits include:

  • College Savings Bonds: The House would start taxing students on money they use from such bonds to pay college expenses.
  • Coverdell Education Saving Accounts: The House would prohibit new deposits into these accounts.
  • Death and Disability Debt Discharge: The House would tax student loan debts forgiven for borrowers who die or suffer total and permanent disabilities.
  • Employer-Provided Educational Assistance: The House would subject what your employer spends on your tuition, fees, books, and supplies to taxation The Senate would leave current law as is — so only employer spending above $5,250 would be taxed.
  • Graduate Tuition Reduction Exclusion: The House would make all tuition reductions awarded to graduate research and teaching assistants taxable income.
  • Interest Deduction on Student Loans: The House would end this $2,500 per year deduction.
  • Lifetime Learning and American Opportunity Tax Credits: The House would repeal the Lifetime Learning credit that applies to what you pay on a course helping you get a degree or a job skill. Instead, it would expand the American Opportunity credit from 4 to 5 years. But the American Opportunity credit applies only to degree-related courses. The Senate would leave both credits unchanged.
  • Tuition and Fee Deduction: The House would kill this $4,000 per year deduction for what you pay in tuition and fees for yourself, your spouse, and your dependents.

All these changes would take affect in 2018 unless the Senate causes them to be dropped.

The Senate will amend, debate, and vote on its bill soon after Thanksgiving, so there’s little time to contact your Senators (their contact information is here). Urge IMG_0081them to use the Senate bill to preserve the tax benefits described above.

The House and Senate must negotiate to finalize all differences in the bills they pass, and such negotiations often lead to one or the other bill’s differences being dropped. So the last, best hope for preserving these tax benefits is a Senate tax bill that opposes the House’s plan to kill them.

Contact College Affordability Solutions at (512) 366-5354 or collegeafford@gmail.com if you have questions.

Special Bulletin: Stop Congress from Eliminating Your College Tax Breaks!

IMG_9916The Ways and Means Committee of the U.S. House of Representatives is finalizing HR 1 and the full House will soon vote on it. It’s called the “Tax Cut and Jobs Act,” but as currently written this bill would eliminate federal tax breaks now available to you if you’re a current, former, or future college parent or student.

But HR 1 hasn’t become law yet. You can still influence it by telling your IMG_9919Representative you want these tax breaks left intact. So find your Congressperson’s contact information here and call or write immediately!

The higher education tax breaks you’ll lose if HR 1 becomes law as currently written include:

  • Tuition and Fee Deduction: HR 1 would end your right to deduct up to $4,000 per year for what you pay in postsecondary tuition and fees.
  • Scholarship and Fellowship Exclusion: Under HR 1 the government would IMG_9917tax scholarship and fellowship amounts that pay for your tuition, fees, books, and class supplies.
  • Lifetime Learning and American Opportunity Tax Credits: HR 1 would eliminate the Lifetime Learning Tax Credit. For an unlimited number of years, this credit allows you to reduce your federal income taxes by up to $2,000 per student for what you pay toward tuition, required fees, books, and supplies for courses leading to a degree or to acquiring or improving job skills. To partially offset this loss, the American Opportunity Tax Credit of up to $2,500 per student would be expanded to cover five, instead of four years of these expenses — but only for at least a half-time degree or certificate-seeking student.
  • Student Loan Interest Deduction: HR 1 would end your tax deduction of up to $2,500 per year on student and parent loan interest you pay.
  • Employer-Provided Educational Assistance: Today the first $5,250 your employer pays on tuition, fees, books, and supplies for courses you take is excluded from what determines your federal income taxes. HR 1 would end this, and you’ll be taxed on such assistance.
  • Coverdell Education Savings Accounts: HR 1 would make 2017 the last year to make new deposits into Coverdell accounts.
  • College Savings Bonds: HR 1 would tax students on money they use from federal college savings bonds to pay for college.

The House votes on HR 1 soon. So if these or any of its other provisions would affect you, hurry up and exercise your rights as a citizen!

Got questions? Feel free to contact College Affordability Solutions at (512) 366-5354 or collegeafford@gmail.com.

During College: Strategies for Your College Finance Plan

Your College Finance Plan (CFP) needs strategies for you and you student toIMG_9592 implement before, during, and after college. Let’s look at the “During College” phase.

Research at a major university indicates that, looking back, almost 4 out of every 10 seniors conclude part or all of their student loans weren’t essential for their educations. Therefore, some of these strategies focus on personal money management so students can spend and borrow less of the interest-bearing educational debt that, over time, increases college costs. These include:

IMG_9555Also, the faster your student gets her degree, the less cost and debt she’ll incur. Still, the latest national data show that only 39.8% of undergraduates earn their bachelor’s degrees within 4 years. Here are some strategies that’ll help your student graduate on-time, if not before:

 

Look here for why you need a CFP. You can find summaries of strategies for your plan’s “Before College” phase here. And next Wednesday there’ll be samples of “After College” strategies for your CFP here.
Beginning October 16, check this website every Wednesday for a more detailed account of a strategy you may want to use in your CFP’s before, during, or after college phase.

Before, During, and After College: You Need a Plan!

About 4 million babies will be born in the U.S. this year. Naturally, their parents want each of them to enjoy the American dream. Now, more than ever, that dream includes, even depends on a good education beyond high school.

But the dream is unraveling. It’s coming undone as the rising cost of college outpaces all but the wealthiest families’ ability to pay for it.

In 1998, the total cost of a year at a state college or university averaged $10,458. That was 27% of IMG_9377U.S. median household income. Eighteen years later this cost was $24,610, or 42% of median household income. At this rate, freshman year public college expenses for 2017’s newborns will average $33,224 — an astounding 56% of median household income.

Small wonder educational debt for recent college graduates averaged $34,000, or that 44 million Americans owe $1.4 trillion in such debt. Nor is it surprising that, in 2015, there were a million fewer students in college than in 2010; the first ever 5-year drop in our nation’s college enrollment.

How to ensure your child can afford college when he or she is ready to attend? It won’t be simple, and it won’t be easy. But a College Finance Plan (CFP) can help.

A CFP is like a mortgage — a decades-long undertaking. You (the parent) and your student (son or daughter) are its key players. It involves nothing exotic or fancy; just strategies to be adopted before, during, and after actual college enrollment. You’ll want to start implementing these strategies as early as you can, and stick to them.

A CFP won’t make college free, or even inexpensive. But collectively, its strategies can help make college costs more manageable so your student can access the best possible postsecondary education.

Want a quick look at strategies you should consider for the “Before College” phase? See Before College: Strategies for Your College Finance Plan. A review of “During College” strategies will be posted on this website October 2, and “After College” strategies will be outlined here October 9. IMG_9373You’ll also find more in-depth discussions of individual strategies here through the end of academic year 2017-18.

No matter where you and your student are in the college-going process, itake concrete steps to keep the cost of a postsecondary degree within your means. Start building your CFP now!

Got questions about college costs and how to deal with them? Contact College Affordability Solutions at (512) 366-5354 or collegeafford@gmail.com for help at no charge.

Before College: Strategies for Your College Finance Plan

It’s best to begin your College Finance Plan’s (CFP’s) “Before College” phase when your child is born, if not before. But don’t give up if you didn’t. Instead, get going as soon as you can.

Consider initiating these strategies as your student gets closer and closer to college:

Birth through Junior High:

  • Invest and Save. Let time multiply your money, even if you can only put away a little. For example, a $50 month deposit into a 1% savings account beginning at birth will yield $14,820 through college commencement.
  • Prepare Your Child to Pursue Scholarships. Some scholarships are awarded IMG_9375based on grades and test scores, some stress essay and interview responses, and others go to students with strong resumes. So help your student do well academically, develop verbal and written communication skills, and persist in extracurricular and leadership activities she enjoys.
  • Identify a General Career Direction. He needn’t decide on cardiovascular surgery by age 15, but helping him develop in broad subject areas about which he’s passionate can save your student from being among the 80% who change majors — some two or three times — generating extra costs for extra courses.

High School through Junior Year

High School Senior Year:

  • Apply for Aid. Filing the FAFSA is a necessity. If your student’s seeking institutional or state aid, too, other application forms may be required.
  • Analyze Affordability When Selecting a College. Public data can help project what you’ll pay for a degree from each school to which your student is accepted.
  • Select a Good Fit. Fit helps reduce the chances of your student transferring, which amplifies tuition costs for repeating courses not accepted by his new school.

Why implement a College Finance Plan? Go to “Before, During, and After College: You Need a Plan!” for answers. A review of “During College” strategies will be posted on this website October 2, and “After College” strategies will be outlined here October 9. More in-depth discussions of individual strategies can be found here through the end of academic year 2017-18.

Contact College Affordability Solutions at (512) 366-5354 or collegeafford@gmail.com for free help if you have questions about your CFP.