How to Help Your Graduate When He’s Dragging His Feet on the College Decision
Your high school graduate may be dragging his feet on the college decision, and it’s not hard to figure out why. During this corona-crazy time, you’re trying to figure out how to put one foot in front of the other. Your teen may be struggling to a degree you can’t even fathom.
His life has flipped upside down — arguably even more than yours. (Did you withstand a worldwide epidemic that required you to kiss prom, graduation and the senior state track meet good-bye? Of course not.) You might feel a tiny whirl of relief to know that your child may not have to decide on a college until July 1. Whew! (Some schools’ deadlines are still May or June 1, however. If your child had a pile of schools with June 1 or July
Your child might be a bit fearful of the future. As a parent, these changes have crushed you too, and you might be grieving the loss of “what should have been.” Here’s how to help pilot your college-bound child through the next hurdle (with baggage nobody could have anticipated).
Table Of Contents
- Listen. Talk Less. Rinse and Repeat.
- Take Advantage of Colleges’ Extended Deadlines
- Ask What’s Holding Your Child Back from Making the Decision
- Seek Answers to Objections
- Do the Heart/Gut Test
- Communicate with Admission Counselors
- A Different Decision May Be Necessary — and That’s Okay
- Take a Deep Breath and Be There
Listen. Talk Less. Rinse and Repeat.
I worked in college admission for 12 years and I heard so many parents say, “It’s my child’s decision, not mine.” I never loved that response because I always knew students wanted their parents’ input when it came to making such a big decision. Now more than ever, your child needs to know that you’re there to help.
Furthermore, your teen could be taking cues from you. Do you watch the news on a constant loop or fret about the future?
Remember that it might be hard for your teen to articulate everything he’s feeling — kind of like when he was two and couldn’t explain that his shoes were too tight.
Create a safe communication environment and listen when your child talks. Don’t forget to check your own fears about what’s coming down the pike.
Let your college-bound teen know that you’re there to help him through the decision. Just remember, teens want their parents to help them with this decision, particularly when they’re struggling. Talk about how life can be uncertain but things will get back to normal.
Take Advantage of Colleges’ Extended Deadlines
Carnegie Dartlet, a marketing services company that specializes in higher education institutions, surveyed 4,848 high school seniors about how current events have impacted their college search. The survey found that many students want an extension to the traditional May 1 National Candidate Reply Date — the national deadline for making a college decision.
In fact, 67 percent of students surveyed say they want an extension, at least until June 1 or July 1, and those numbers jump to 74-80 percent for underrepresented minority populations and students with higher financial need.
Breathe! As you can see, your child isn’t the only one who feels this way.
Many colleges have complied with students’ wishes and extended the deadline to accommodate these needs. Take advantage of the extra time — and be proactive. Launch a pros and cons list. Dive even deeper and do a heart/gut check. Don’t be afraid to take a trip down memory lane with your child. Remind him about the awesome college visit at College ABC last fall where you snagged a picture of him beaming during his college visit.
Ask What’s Holding Your Child Back from Making the Decision
What’s holding your child back from making the decision? Is it all the changes combined — summer orientation changes, school delays
Get to the root of the problem. Ask straight up, “Is there any reason why we can’t put down a deposit for School X right now? It’s the school you’ve been talking about all year.” Then listen carefully to your child’s response.
Here are some common reasons that might be holding your child back.
The Coronavirus (or Worry in General)
Everyone’s plans have changed and it could also cause your child to question everything. It’s up to you to be a calming influence. Try to help your child gain some perspective on his college choice. Try as hard as you can to be a positive, uplifting influence.
In some cases, you may recognize that COVID-19 has aggravated anxiety in your teen and it may be a wise decision for your child to stay closer to home or make a different decision altogether. If necessary, seek outside help.
Distance from Home
The majority (56.2 percent) of public four-year college students attend an institution under an hour’s drive away. Nearly 70 percent attend within two hours of their home, according to the latest Higher Education Research Institute’s CIRP survey.
Your child might be feeling a tad unsettled about making a decision to attend school 10 hours away. Ask if that’s an issue and whether there’s a school that appeals to your high school graduate that’s closer to home. Note: Your child would not be the first one to change his mind at the last minute. It happens — and it’s okay. It’s better to realize this now instead of later!
Money
Is your cost-conscious child close to choosing a college with a hefty sticker price — which would require a handful of loans? If so, that could be what’s holding him back. (And you might be nervous, too.)
There are lots of ways to remedy this situation. Now that COVID-19 has happened, your financial situation may have changed considerably. If it has, let the college know. You may be able to fill out the college’s special circumstance form, where you can indicate a job loss or some other changes in your financial status, including excessive medical bills or another type of serious expense.
You can also ask the admission office if there’s still money on the table. Ask:
- Are there other scholarship opportunities available? Find out whether there are additional scholarships your child can still apply for. There may be some new ones that have popped up since the last time you talked with the admission office!
- Is work-study available? Work-study is a federally-funded program that can help your son or daughter pay for college. Your child will work on campus (sometimes off campus) and earn money just like in a regular job. Your son or daughter may not have been awarded work-study at all, and this is the time to ask whether it’s available. If work-study is already plugged into the financial aid award, ask if more work-study money can be added.
- Was my FAFSA information correct? Ask some deeper questions about the FAFSA — you might have filled it out incorrectly! Was your expected family contribution (EFC) inflated due to one-time income? (EFC is an indicative number that colleges use to determine how much financial aid you’re eligible for.) Did you include an IRA or 401(k), which isn’t required for the FAFSA?
The bottom line: Ask the admission office good questions!
Don’t forget to communicate with colleges about changes in your financial situation. If you or your spouse has lost a job, tell the colleges on your child’s short list. Talking about financial changes could change your college-bound teen’s financial aid awards — in a good way.
Seek Answers to Objections
Help your child get the answers to what’s holding him back from making a decision. For example, if he’s worried about the strength of the engineering program between two schools, reach out to the admission counselor at each school to get some more data. Reach out to a professor. Ask more questions! Draw on those relationships you’ve built throughout the process to help your child make a final college decision.
Maybe your child’s holding back because his friends or his girlfriend are all headed to the state school down the road and he’s been planning to go to a school on the opposite coast. (I hated it when this came up when I was an admission counselor!)
If he’s starting to get cold feet, remind him why he initially chose that institution. (There were likely some good reasons!) It’s important that he chooses the best school for him.
Once you’ve
Do the Heart/Gut Test
The heart/gut test is something that a former college president of my alma mater used to talk about all the time. He’d explain that it’s not enough to take numbers into account. College isn’t a transactional experience — it’s about people! It’s not just about pretty buildings or the number of electives you have to take. He used to urge students to take into account the feeling you’d get — did your child feel like he belonged at a particular school?
Which campus did your son thrive on during the visit? Did he seem to come alive as soon as he met the tennis team? Withdraw when he met the abrasive engineering professor at your alma mater? Did your daughter light up when she met her admission counselor or the quirky communication studies professor with “Citizen Kane” posters plastered all over his office?
You get the idea. Don’t be afraid to go deep on this. Also, don’t be afraid to share your observations with your child. Say, “I noticed you loved the tour at College X and chatted animatedly with the tour guide. Do you think you felt just as comfortable at College Y or not?”
Look for the academic, social and financial fit — and do the gut and heart test. Ask your child where he or she felt most at home.
When you know, sometimes you just know.
If your child hasn’t gotten that “feeling” anywhere by now, go back to the drawing board — there are still openings at schools across the country. Another visit might be in order over the summer, though without students on campus, it can be tricky to feel the same energy.
Communicate with Admission Counselors
Contact admission counselors at the schools your child’s still considering. Trust me, my experience as an admission counselor tells me that colleges want to hear from you and build relationships. They don’t want you to go through turmoil alone.
Explain what’s going on and why there are some concerns. Most colleges have trained their admission counselors on how to communicate their college’s COVID-19 response. Talking with admission counselors is also a good way to evaluate how well a particular college has handled the crisis!
Colleges should make your teen feel better about the situation, provide a real human connection and help your child make a final decision.
A Different Decision May Be Necessary — and That’s Okay
Your teen may not be able to stomach leaving to go to college 1,000 miles away at this point, no matter how many times you remind him about his last wonderful on-campus experience.
This crisis has changed everyone. Tell your child that it’s okay to stay closer to home. Spend time thinking about what other options are out there. Remember, just because your child feels more comfortable with a semester at the local community college, it doesn’t mean he will never go to College ABC. He could be saying “See you later!”
Take a Deep Breath and Be There
Sometimes, it takes the good ol’ pro and con list to finally make the final decision. Sometimes seeing the solid “pro” column helps.
What happens when the “pro” side is a mile long for one school but your daughter really feels the fit more at a different school? Hey, it’s proof that the heart/gut test works!
Teens can feel their parents take an emotional and financial hit during this downturn and need more reassurance and guidance than ever. Support your teen through this all-important decision-making process. Remember, this could very well be the very first really big decision your child has ever made. Think positive: COVID-19 could make you (and your teen’s) decision making processes stronger than ever!
Good luck! I’d love to hear about your child’s final decision!
6 Powerful Ways to Combat Financial Stress When Your Child’s College-Bound
When your child is college-bound, financial stress is a very real thing. In fact, the financial part of sending a child off to college can be overwhelming.
I spent 12 years working in college admission at my alma mater. Every so often, parents would break down in tears in my office. They wanted so badly to be able to pay for college. I’ve never forgotten these conversations and I still think about those families.
Money is one of the most commonly mentioned personal stressors, according to the American Psychological Association’s 2019 Stress in America survey. In fact, 60 percent of people from the survey cite money as a major stressor.
Chances are, you probably feel some financial stress — I mean, 60 percent is a heckuva lot of people!
It’s easy to say, “Think about something else! Go for a bike ride!” You know, common ways to de-stress your life. But financial stress is so different — it doesn’t go away when you spend 30 minutes with a yoga mat. It may take time and involve some serious planning.
So instead of telling you to grow your own potatoes or start extreme couponing, here are six ideas for how to attack financial stress. Warning: They’re not all quick fixes, but they will help you feel better about financial stress later on. Promise.
1. Recognize how you deal with money-related stress.
The first thing you can do to alleviate financial stress is to recognize how you handle money. Have you ever stopped to evaluate how money in general
Maybe you:
- Never talk about it. You just let the stress build up like a hot air balloon.
- Talk about money (or lack thereof) with everyone — your spouse, your kids, your friends — everyone!
- Fall somewhere in between these two approaches.
Suze Orman, award-winning author and financial personality, believes that how your parents handled money paved the way for you to formulate your own attitudes about money.
Did money cause stress in your family? Did you parents spend more than they earned? Was money a source of pain? Were your parents controlled by money instead of the other way around?
Orman grew up in a poor family. She often tells the story about how her father’s small takeout restaurant burst into flames. He still ran in to get the cash register, burning his hands in the process. It showed a young Orman that money is more important than life itself!
Money is so closely tied to emotions.
You may want to think of it this way instead: You define your money. You tell it what to do! You’re in control of it! You can make as much as you want. (You just might not be able to do that completely through a traditional nine-to-five job. Check out my piece on how parents can make money!)
2. Write down your goals.
When I worked for the college, I gave a presentation to my team during our annual summer retreat about writing goals. When I announced my topic choice, I’m pretty sure everyone groaned. “Why do you feel that way about goal setting?” I asked.
Our campus visit coordinator replied, “It’s boooring.”
I laughed and said, “What’s boring about getting exactly what you want? Let’s say you write, ‘I’d like a new car in a year and I’ll do A, B and C in order to save for it.’ What’s boring about that? You get a new car!’”
I’m sort of a geek when it comes to goal-setting. Let me tell you, writing down your goals works. For example, my husband and I resolved to save a certain amount of money
The premise is simple: Write it down, make it happen!
You can write down your goals associated with paying for college. Let’s say you write, “Get a side gig by July 2020 to earn extra money for Junior’s college fund.” And yes, you can do this even if your child is set to go to college this fall.
Try it! Write it down! I
3. Meet with a financial advisor.
You may already have a financial advisor, but if you haven’t met with him or her recently, it may be time for a financial checkup.
Never worked with a financial advisor before? One of the best ways to find a great financial advisor is to ask around. Ask your family and friends who they use in town. It’s important to have a financial advisor who has a good reputation
Next, meet with a few financial advisors and ask good questions! Here are some you can ask:
- Are you a fiduciary? A fiduciary will put your financial interests before their own. If a financial advisor is not a fiduciary, don’t choose that advisor.
- How do you get paid? Focus on fee-only advisors. Fee-only advisors might charge a percentage of the assets they manage for you — a flat fee for services or an hourly fee. If costs are a concern, use a
robo -advisor like Betterment, Wealthfrontor SigFig. - What are your qualifications? You can check the legitimacy of a financial advisor by visiting FINRA’s BrokerCheck. BrokerCheck is a free tool that can help you research advisors and firms.
- How will you help me map out a plan to pay for college? Whether you’ve saved nothing at all or have some money in the bank, an advisor should be able to give you an idea of how he will help you approach paying for college.
Make sure the advisor meshes well with your personality. Your best friend may have recommended a
Believe it or not, talking with financial advisors is often very soothing. The reason? They help you come up with a concrete plan to help you tackle your goals.
4. Use financial aid to your advantage.
Yes, this could be the most obvious de-stressor of all — getting financial aid!
Class of 2020 parents, you can combat financial stress during this corona-crazy time. All it takes is a simple phone call. Ask the financial aid office at your child’s chosen college if there’s any extra money laying around. Inquire about extra scholarships. Ask about work-study. Tell the financial aid office about a recent job loss. Talk to someone in financial aid about any financial situation you’re going through. Colleges want your child to go to
If you’re the parent of a sophomore or junior, financial aid can go a long way to help you and your child afford college. It’s a great idea to start planning now. Check out my short piece about financial aid (What is Financial Aid? Plus, 6 Steps to Get It) so you start understanding the basics.
5. Reduce other stressors.
What’s a great way to reduce stress? You can make a long list of temporary stress relievers, I’m sure: Go for a walk. Talk to a friend on the phone. Color rocks with sidewalk chalk (that’s what I’m watching my kids do right now).
Do you know what seems to exacerbate one stress? Another stressor!
For example, let’s say you’re already stressed about paying for college. It doesn’t help if you’re stressed about, say, the 2020 presidential election. (I’m not pulling this out of thin air — the American Psychological Association’s 2019 Stress in America survey actually cited the presidential election as a major source of stress. It would be interesting to know how coronavirus would rank now.)
As much as you can, try to reduce other stressors in your life. Have a talk with your neighbor about his dog’s incessant barking. Talk to your mailman about firmly shutting your mailbox door so your mail isn’t soggy every time you grab the mail. (These seem little, but man, are they irritating!)
Eliminate the little stressors so you can tackle your financial stress before college head-on and talk to your spouse or others about what’s really stressing you out.
6. Talk to someone.
Chances are, you know someone else who’s sending a child off to college this fall. Or better yet, you know someone who already has three kids in college right now. This is your tribe! Your friends and community can be a great sounding board for your fears.
If your regular tribe doesn’t include parents of college-bound kids, it may be time to find a new tribe or add to your existing tribe.
You might need to go beyond your tribe and your spouse or partner and seek counseling if you’re really stressed out. If you find daily life to be a struggle or feel that your emotions are overwhelming, seek help. Just remember, money fears are real. It’s okay to reach out to a professional.
Reduce Stress Now
First and foremost, remember to celebrate one major thing: That your child’s going to college. Focus on what’s important. He or she is going to get the college education that he or she (and frankly, you!) have always dreamed about.
Remember that even though you may want to help your child pay for college, it’s still possible for your child to get loans to fund
Above all else, consider your attitudes toward money. Again, you may want to reframe how you think about money. If you think of money as unlimited — flowing in abundance! — it might just happen and help you and your kiddo pay for college.
Why Building Relationships Must (MUST!) Happen During the College Search
When I was an admission counselor, one of the most challenging parts of my job was building relationships with high schoolers.
I remember contacting a particular student for months. I’d talked to his parents a handful of times and they said he was really interested in the college I worked for — he’d applied and everything. I texted, emailed and social media-ed. In a last-ditch attempt, I even called his cell. (What teenager answers his phone?)
I never heard from him. In fact, he remained elusive to everyone at the college. Finally, he visited in March, barely talked throughout our meeting but ended up enrolling.
It’s so important for kids to develop relationships during the college search process — and it’s a good idea for parents to do the same! It can work wonders for their college search and help your child hone in on the right college match.
Why? Building relationships allows you to get an idea of the character of the people at that school — and that’s just one reason why building relationships is a must-do.
Why it’s Important to Build Relationships During the College Search
Jessica Quintana Hess, director of admissions at Lycoming College in Williamsport, Pennsylvania, says, “Families sometimes think, ‘We have all the information we need on the internet. Why do we have to talk to anyone?'”
She says there’s real value in building relationships with the admission staff, financial aid office, coaches and more. She says that, unfortunately, students often don’t take advantage of that or think that the colleges should only exist to serve them. Think of it this way, though. How can an admission counselor help you if he or she doesn’t know what you need?
“Relationship building can help you in the admission process, but if you’re not giving me anything, I can’t advocate for you,” she says.
Building relationships can:
- Help those at colleges do active work on your child’s behalf. So, what I mean by this is that people at the college can advocate for your child, go the extra step and help your kiddo with whatever he needs. Quintana Hess shared this story with me:
She says a young man enrolled at another college (not Lycoming) and got into a bit of trouble during his pre-orientation sessions. He could have stayed at the college but didn’t feel comfortable there anymore. He reached out to Quintana Hess because he had applied to Lycoming. She says he ended up enrolling because she was willing to give him a chance.
“If we hadn’t built a relationship when he was an applicant, he wouldn’t have felt comfortable coming to me,” she says. “I get Christmas cards from his family every year,” she adds. - Cement relationships for down the road. This process is all about finding the match, right? You want to find the right place for your child — and that means interacting with the actual people at the college. Not the buildings online or the list of classes. The college experience is about
the people . - Help your child learn about opportunities. You hear about the heart and soul of an institution from the people who work there. You’ll find out how the robotics instructor hosts dinner at his own home or how the journalism professor stays up till all hours of the night to help students put the finishing touches on a fantastic article.
How to Start Building Relationships with Colleges
There are so many people you could start building relationships with — even before your student arrives on campus. There are three key individuals you’ll want to build a relationship with, plus, one more.
Admission Counselor
The admission counselor’s job is to build relationships with you, particularly if you’re looking at a small private liberal arts college. Even if your son or daughter is looking at a state school, it’s still a great idea to build that relationship.
How do you know who your admission counselor is at each school your child is interested in? Great question.
All it takes is a little poking around on the internet. The country is typically divided up into a giant jigsaw puzzle. Just click on your area and you’ll find your admission counselor.
Coaches (Including Assistant Coaches)
Coaches want to get to know your child, obviously. Your child definitely wants to get to know coaches, too. Just don’t overlook getting to know assistant coaches. They’ll be able to answer a lot of questions that the head coach might not know, including about different aspects of team dynamics.
Definitely build a relationship with players every time you and your child is on campus. Have lunch with team members. Have your child do an overnighter. Make sure your student feels 100 percent comfortable with the team.
Financial Aid Professionals
Financial aid professionals are VIPs. Who else holds the key to knowing everything about institutional scholarships, the FAFSA, grants, work-study, loans and more?
Always make an appointment with the financial aid office when you visit any school. It may not even be an offered option online, so call and ask for an appointment.
School College Counselor
Right, school counselors aren’t at colleges. However, this is a great person for you and your child to get to know at her high school. School counselors can clue your child in on scholarships, connect her with must-know people in the community (scholarship opportunities!) and help navigate the college search.
They wield tremendous power. A dozen cookies and weekly drop-ins from your student will go a long way.
How to Build Relationships
You may know exactly how to build relationships, but your kiddo might not have any idea. Kids spend hours each day engaging with ideas and one another through screens, but do they have good practice honing their interpersonal communication skills?
I noticed this when I greeted hundreds of high school kids over the years — they just don’t know how to talk to adults.
Some parents are whizzes at teaching their kids to interact with adults. I’m always impressed when I say “Hi” to kids and they look me right in the eye, shake my hand and engage in simple small talk.
Teaching kids how to do this gives them a lifelong advantage — I repeat — a lifelong advantage! They’ll be able to ask questions in college, do better in college, and succeed in college! They can sell themselves in job interviews after college (see the theme here?)
Now’s as good a time as any to encourage your child to start learning how to do this, especially if you know it’s kind of difficult for him.
Fortunately, you can start small. Building relationships with colleges happens in more ways than one. You can:
- Call
- Text
- Communicate via social media
- Conference calls
- One-on-one meetings
And more! (I think the COVID-19 crisis will give admission offices even more ideas about how to communicate with students throughout the year.)
So, knowing there are lots of ways to communicate with colleges, I think it’s worth mentioning what your son or daughter can practice.
You want firm handshakes, eye contact and more when he or she interacts with adults — yes, even if your child is naturally shy. Here are some things you can work on.
Initiate Contact
Teach your high schooler that it’s a great idea to initiate contact with an admission counselor. Trust me, guys, I was an admission counselor for years and admission counselors are hungry to hear from your child. It’s the best day ever to open up an email from an interested student or get a text that says, “Hey! I’m interested in your college. Can you tell me more?”
Trust me, most admission counselors will fall all over themselves to answer your child’s email or text.
Respond to Questions
The only way to get better talking freely with adults is to practice. Even among peers, is your child uncomfortable responding to questions or never pipes up in a group setting? It’s okay to be shy, but encourage your child to contribute if he or she is burning to say something. It’s a great idea to practice doing this among friend groups first, then translate it to adults.
On the other hand, your kiddo may find it super easy to interact with peers, but not with adults at all. Encourage your child to practice. Say “Hi” to people at church, have her call up for pizza delivery. Ask your daughter to make her own appointment to get her hair cut — over the phone, not online.
Then work up to calling someone in the admission office to get information. Even better, have her set up a college visit. That’ll require a dexterous blend of having to schedule, coordinate and
Sustain Conversations
Teach your child how to keep a conversation going and more importantly, be sincere in the questions he’s asking.
Gah, it can be such a thing to teach a high schooler how to have a conversation that’s not one-sided. Kids are so used to adults talking and asking the questions — do kids ever practice asking the questions? No. Teach him the art of the open-ended question.
A good suggestion is to talk about the things your child is passionate about — sports, hobbies, goals, dreams. A college professional always wants to hear about a kid’s goals and dreams. It’s what they live for!
I remember a 30-year-old nontraditional student I talked to in the admission office who had a dream to still go to medical school. At 30! I was entranced by his story — I could have listened to
Admission professionals lap that stuff up. Make sure your child knows how to talk about his goals.
Practice it Yourself
You may cringe if you notice that your child doesn’t interact well with adults.
But what are your own habits? Do you go out of your way to make small talk with strangers at the grocery store or waiters at a restaurant, or do you just exchange acceptable pleasantries and nothing more?
Your child picks up social cues from you. Remember that.
Continued Communication
When people like you, they want to continue chatting with you! The best thing you can do is have your child continue to stay in contact with prospective schools for an entire year. (Yes! A whole year!)
If your child’s no longer interested in a particular school, it’s important that he tells them. Reach out to admission counselors to let them know they no longer need to recruit your child.
(It can be frustrating for admission staff to have to keep reaching out blindly because they have no idea your child’s no longer interested.)
Have your child send an email or text to the admission counselor to let them know they’ve chosen a different college.
Start Building Relationships Now
Don’t waste any time! Start building relationships with everyone you can at all colleges, whether your child is a sophomore or senior. Make sure your student does, too. It’ll serve your child well later.
What to Do When College Investments Drop and Your Senior Wants to Go to a Pricey College
Here’s the college scenario as you probably imagined it:
- You’d visit your child’s chosen college one last time this spring — just to make sure he loves it.
- You’d visit with the financial aid office and the cost piece would click into place.
- Your kid would be happy, you’d be satisfied. He’d be all ready to make a final decision.
But things may not be working like that at all. To add insult to injury, the account you’d stuffed money into (since he was in diapers!) may have tanked.
Well-meaning people may have said to your kiddo, “Go to community college! Go to a trade school! Do it online! Work your way through school!”
Sure, your child could attend a less-expensive institution — there are thousands of cheaper options. But a cheaper option might not be a good fit for your child. As you’re well aware, there’s more to choosing a college than just money.
Here’s what to do if the stock market has wreaked havoc on those college invest accounts and your kid is firm in his desire to attend a school that’s, well, not cheap.
First, Here’s What’s Going On
What’s one thing investors hate?
Uncertainty. Even if you’re not wild about economics, you can see how consumer fears can hamper the economy:
- Consumers are nervous about spending money so they don’t spend as much.
- Businesses freeze. They do whatever they can to keep operating without as many customers.
- Unemployment increases.
- Many investors sell stocks and flock to lower-risk investments.
- The value of your portfolio goes down.
COVID-19’s impact on the economy and market has taken a breathtaking toll. In fact, the entire occurrence’s been dubbed a “black swan.” There’s no predictive modeling for an illness — most of the people in the finance industry aren’t epidemiologists. So what will happen next?
Consider What May Happen
The consensus among experts is that the economy will recover quickly from this crisis. They say we’ve cruised into the fastest bear market in history and the stock market will bounce back quickly.
However, what about jobs? During the Great Recession, according to the Bureau of Labor Statistics, unemployment totaled:
- Five percent in December 2007
- 9.5 percent in June 2009
- 10 percent in October 2009
It took 10 years to dig out of these employment levels. It could happen this time around, too. Do you think your job’s unsafe? Could a job loss further hamper your
Not great things to think about. Sigh.
Analyze Your Investments
Many, many college savings plans (like 529s) automatically move from an all-equities aggressive allocation to a more conservative bond allocation as your child grows older.
Plain English: This simply means that as your son or daughter approaches college age, risk automatically reduces.
This is how retirement savings should work, too. For example, in the early years of your career, an all-equities portfolio is appropriate, but as you grow older, more bonds (or similarly less-risky investments) should be added to your asset mix. (Check your retirement savings’ asset allocation. Ask your plan administrator if you’re not sure if your account is where it should be.)
Let’s say you invested in an all-stock portfolio and dubbed that “Junior’s College Savings.” If it’s too heavily invested in high-risk funds, don’t beat yourself up. It’s easy to lose track of it over time or listen to some bad financial advice. At any rate, you may feel more comfortable moving that money to something more low risk.
- If your child is going into college next year, it’s not a terrible idea to move a year’s worth of tuition into a cash-based investment, like a money market fund.
- Talk to your financial advisor and make sure your child’s account is in an appropriate portfolio option.
Know that Your Child’s Not Out of Options
Want to know one beautiful difference between paying for college and floating your own retirement?
Someone who hasn’t saved a penny may not be able to retire, whereas there are always ways to fund a college education.
Even if your savings have tanked or you’re facing a job loss, your child still has options. Let’s chat about them.
1. Reach Out to Colleges About the Financial Aid Award
Colleges get it: COVID-19 means a whole slew of families may have challenges paying for college.
Reach out to the college your son or daughter wants to attend. Be sure you’ve gotten a financial aid award from that school. Ask the following questions.
Are there other scholarship opportunities available?
Scholarships in all forms and sizes are widely available, which you may have discovered when you received your child’s financial aid offer. Many are small — between $500 and $2,000 — but they can add up. Ask the financial aid office whether there are additional scholarships your son or daughter can still apply for. The school may be happy to let your child apply for a business scholarship or last-minute theatre scholarship. All you have to do is ask.
Can my child get work-study? Or get more work-study?
Work-study is a federally-funded program that allows your child to earn money through an on-campus job.
Your son or daughter may not have been awarded work-study at all, and this is the time to ask whether it’s available.
Ask if more work-study can be added if it’s already plugged into the financial aid award.
How can student loans help? What are my options?
Loans get a bad rap. They really can be a lifesaver. If they’re done right (in the context of a well-conceived financial plan!) they don’t have to create an insurmountable financial burden after graduation.
In other words, carefully analyze how loans can be pieced into the mix after scholarships, grants and
Was my FAFSA information correct?
It’s easy to make a misstep on the FAFSA. Work with the financial aid office to double-check. Did you (whoops!) include your 401(k) retirement? Was your expected family contribution (EFC) inflated due to a one-time income? (EFC is an indicative number that colleges use to determine how much financial aid you’re eligible for.)
The financial aid office at your child’s future school should be able to help you fix errors on your FAFSA.
2. Let Colleges Know You Have Different Circumstances
Have you experienced a job loss or a significant reduction in income? The college needs to hear about it. There are other situations that could qualify as special circumstances:
- You support multiple households. (For example, you may live apart from your spouse or you may support elderly family members.)
- One-time income
- Funeral, medical or dental expenses
- Your own education debt
Make sure the college knows about drastic changes in your college savings accounts. Check with the college financial aid office to find out whether you’re eligible to fill out its special circumstance form.
3. Delay Using Funds if Necessary
You may feel as if it’s best to wait a year or consider alternatives to give your investments time to build back up. For some kids, working for a year or waiting a little longer is a good idea. For others, it’s not a good idea at all. Some kids need the structure of an academic environment right after high school.
What’s best for your kiddo? A healthy family discussion could be in order. Here are some ideas to springboard a discussion:
- Your child could go to his desired college part-time and work part-time to help pay for it.
- He or she could take a gap year. Almost all schools will allow you to defer enrollment. Deferring enrollment would put time on your side in hopes that investment returns would be more positive in a year’s time.
These options might not be ideal. If you all decide that your child’s best bet is to go to the school
There are other years you can apply the money you’ve saved once the markets have bounced back.
Focus on the Positives
Sure, your child could always attend a less expensive community college for two years and then transfer those credits to a four-year college to earn the degree. But you know he’d be more successful at the liberal arts college or university he wants to attend. There’s some security in knowing you’re making a good decision for your child
Remember, there’s a lot to be okay with now. The coronavirus epidemic isn’t hitting at the end of July — it’s still April! That still means that there’s time to recover and let things get back to normal before August or September.
Many schools are optimistic that a regular return to the school year will happen by fall.
Finally, remember that your child is going to his first choice institution, and that deserves some congratulations. Again, some things are more important than “getting a good deal” on a college.