How Much Should You Save for College?

How-Much-Should-You-Save-for-College

At the start of your senior year in high school, how you’ll pay for college may not be a high priority yet. It’s something you should be thinking about, though, as you consider different colleges and the costs associated with attending each one.

A national study, How America Pays for College 2017, shows that the average student contributes 11% to the total cost of his or her college education. That is money from the student’s income and savings, not student loans.

So, how much should you plan to save for college this year?

That answer depends on a multitude of different factors, but the easiest response is “as much as possible.”

If you want a more precise number, though, there are things you can do now to determine how much you want to save during the next 12 months.

Create a Budget

Use an in-school budget tool to start forming an idea of how much money you’ll need to live on each month. It’s OK to guess right now and try out different calculations. How much will you cover with grants, scholarship and student loans, and how much will you need to have on hand each month for your extra costs?

If you live on campus in a dorm during your freshman year at college, many of your expenses will be set and you’ll be left with a smaller number of variable categories. But if you’ll be living off campus, you will have to calculate additional costs like your portion of the monthly rent, gas and car maintenance, and how you will fill a refrigerator.

Figuring out how much you will need each month can help you set a goal for the amount you definitely want to save during your senior year.

Compare Costs

While you’re creating different in-school budget scenarios, be sure to consider the costs needed for different schools you’re considering. Less-expensive schools might seem like the way to save money, but many times those institutions also have less money to offer in terms of scholarships and grants compared to more-expensive colleges or universities.

Anticipate that you will need more spending money than you think to ensure you don’t greatly underestimate how much you will need to save.

Reduce Expenses

Is your budget a lot higher than you expected? Check out these ideas for ways to save on supplies. Will any of those options help reduce your monthly budget?

You can also consider options such as:

  • Living at home and attending a community college for your first year or two to meet your general education requirements.
  • Planning to work part-time during college to help you cover some monthly expenses.
  • Cutting back on entertainment or other non-necessities to reduce the amount needed for spending money each month.

It may seem like a daunting task, but the more you’re able to save for college today means less that you will have to borrow in the future.

By: Iowa Student Loan

Crossing the Line: Improve Academic Standing for Financial Aid

CrossingtheLine_ImpAcademStnding

Good grades and test scores typically mean more scholarship opportunities. Did you also know that a small margin can sometimes push you over the line for eligibility, or even for higher awards? Here’s a look at how small improvements matter.

PSAT/NMSQT

The Preliminary SAT (PSAT) is also the National Merit Scholarship Qualifying Test (NMSQT). If you take the PSAT as a junior, you’re automatically screened for the National Merit Scholarship Program. The top scorers in each state receive special recognition.

  • About two-thirds receive Letters of Commendation and become eligible for special scholarships sponsored by corporations and businesses.
  • About one-third become Semifinalists, and most of those complete several steps to become Finalists. Finalists are eligible for:
    • Merit Scholarships from the National Merit Scholarship Corporation, corporations and colleges.
    • Special scholarships up to and beyond full tuition from certain colleges.

The difference between a Commended student’s score and a Semifinalist’s score could be a single point in a metric called the “Selection Index,” which is based on your PSAT scores.

How to Cross the Line

Preparation is key for the PSAT.

  • Take the PSAT 10 as a sophomore to become familiar with the test format and see where your strengths and weaknesses lie to better prepare yourself for the PSAT as a junior.
  • Use practice tests to review the test concepts and learn which answers are considered correct or incorrect and why.
  • Be sure to practice in timed test-taking situations.

ACT and SAT

Most colleges require you to attain a specific minimum score on either the ACT or SAT before admittance. Once you have narrowed down your college choices, review their scholarships pages. Many academic scholarships are based either entirely or partly on those test scores, and one or two more points may push you into a category for a more substantial award.

How to Cross the Line

Many of the same techniques above for the PSAT apply when taking other standardized tests like the SAT and ACT. Keep these additional pointers in mind:

  • While the PSAT and SAT are both offered by College Board and have many similarities, the ACT comes from another provider and the format and content areas may be quite different. Use specific practice tests for the SAT or the ACT, depending on which test you plan to take.
  • Check to see if the colleges you’re applying to require or recommend that you take the optional essay portion.
  • You may retake either the SAT or ACT to try to improve your score.
    • Concentrate on preparing for the areas in which you want to improve, but continue to practice all parts of the test so your other section scores don’t fall.
    • Consider your options for sharing your scores with colleges. You may want to wait to see your new score before you submit it to a college, but an additional fee could be required.
    • If your score improves in some parts of the test, but you have a lower composite score because of lower scores in other sections, see whether your college will superscore, or consider your best score for each section of the test separately.

High School Grades

While you’re checking the test score requirements for scholarships, pay attention to the required high school GPA as well. Will bumping up your overall GPA a fraction of a point move you into another scholarship category and make you eligible for hundreds or thousands of additional dollars?

Increasing your GPA may also make you eligible for increased money from outside scholarship sponsors. When you search for scholarships, try a search with an additional 0.1 or 0.15 added to your actual GPA to see if you get more results. (Don’t lie on scholarship applications; improve your GPA before you apply.)

How to Cross the Line

Increasing your GPA may take some extra effort, but if it nets you additional cash for college, it’s worth the work.

  • Don’t wait. Take steps to improve a specific grade early in the semester or year. Later, you’ll have fewer opportunities to earn points, and a perfect final test can only offset so many earlier mistakes.
  • Take advantage of every extra credit opportunity.
  • Ask your teachers how you can improve your grade. Some may be willing to provide credit for an extra project or paper if you explain why you need the grade boost. (This is most effective if you’re an engaged student who generally completes all work on time, even if you don’t always get an A.)
  • Improve your study habits. See these tips for studying smarter.

By: Iowa Student Loan

Maximizing Summer Earnings for College

MaximizingSummerEarnings-College

About this time of year, panic tends to set in for new high school graduates looking at their upcoming college costs. If you’re planning to work this summer to offset some of your college expenses, consider these tips.

1. Know How Earnings Affect Your Financial Aid

Although your financial aid has already been determined for the upcoming year, your annual income can affect future aid.

The Free Application for Federal Student Aid, or FAFSA, provides an income protection allowance — the amount you can earn during a calendar year before your financial aid package is affected. For the 2015–2016 year, this amount was $6,400.

You shouldn’t necessarily try to limit your annual income to less than the income protection allowance, however. The income tax you pay on your earnings is also taken into account, and the type of aid you receive makes a difference. Offsetting student loans with income is beneficial, while earning enough to reduce need-based grants isn’t so great.

If you have questions about how your earnings will affect your future aid, talk with a financial aid officer.

2. Make a Plan for Your Earnings

The amount you need to save from each summer paycheck is determined by your goals. Are you planning to offset specific expenses, such as clothing, books or entertainment, for the school year? Are you planning to earn enough to make interest payments on student loans?

Use your goals to determine a percentage of each paycheck to put into savings. Don’t forget that you may need to use part of each paycheck to cover current expenses, such as work clothes, gas and car insurance, and that you will have taxes and other deductions removed from each check. You may also want to plan on spending a little each month on summer entertainment as well.

3. Simplify Your Saving

It’s often tempting to use cash in hand, and sometimes students find they’ve spent the money they intended to save without really thinking about it. Avoid the cash crunch by:

  • Depositing your pay right away. If you have the option to have your check direct-deposited into a checking account, take advantage of it. If not, or if you are paid in cash, deposit it directly after you receive it to avoid unnecessary spending.
  • Automating your savings. Set up an automatic transfer from your checking account to your savings account that corresponds with your pay date. For example, if you are paid by direct deposit every other Friday morning, have an amount equal to the percent of your check you want to save automatically transferred to your savings account on those Friday afternoons. Time the transfer as close to the deposit as you can without risking overdrawing your checking account.

4. Stick to Your Goals

Once school starts in the fall, remember what you worked so hard for over the summer. If you intended to use your summer earnings for books, don’t let the desire for new clothes or evenings out distract you from your goal. If you haven’t already considered it, think about a part-time job during the school year to pay for other items you want or need.

By: Iowa Student Loan

Maximize Your Graduation Money

MaximizeYourGradMoney

Your high school graduation is an occasion to reflect on past accomplishments and prepare for a new adventure in college. It can also be a veritable gold mine.

As college becomes increasingly expensive, many of your family and friends may opt to give you a gift of cash to help you offset your costs. While it might be tempting to use that newfound cash to upgrade your phone or gaming system, you could use that money in ways that will better help you prepare for college. Here are some ideas to make the most of monetary gifts you receive.

If you have: You could:
$50–$100
  • Get a haircut.
  • Have the oil changed in your car.
  • Buy a few dorm or personal care items.
  • Pick up an interview outfit.
  • Buy paper, pens and other supplies.
$100–$500
  • Rent some of your required books.
  • Pay for a campus parking permit.
  • Buy a bike to get around campus.
  • Pay program fees or club dues.
$500–$1,000
  • Get a computer or other electronics you need.
  • Put money toward your tuition bill.
  • Buy plane tickets to come home at the semester break.
  • Save for a rental deposit if you plan to live off campus next year.
  • Pay major- or activity-specific fees.
$1,000–$5,000
  • Save to use toward future tuition and fees.
  • Buy textbooks and supplies for one year.
  • Pay a summer’s rent for an off-campus house or apartment.
  • Cover fraternity or sorority dues and other expenses.
  • Cover insurance deductibles for a car or medical emergency.

By: Iowa Student Loan

Iowa Families Can Win Cash for Educational Expenses

Iowa high school students and their families can enter weekly drawings for two $250 awards, and Iowa high school seniors can enter a grand prize drawing for two $1,500 awards by completing a free online tool that helps them estimate the total cost of a four-year undergraduate degree.

Learn more and enter the giveaway today!

Iowa high school students, and their parents or guardians, can enter their information for the drawings after completing the College Funding Forecaster until May 11. The free online tool provided by Iowa Student Loan uses information from students’ freshman year financial aid award packets, as well as outside scholarships and grants and family savings and earnings, to project estimated costs, funding gaps and potential student loan debt over four years.

“We want to help families make the connection between first-year costs and the total financial investment in a college education,” said Steve McCullough, president and CEO of Iowa Student Loan. “This tool helps them see how their costs might increase, what happens when one-year scholarship awards are exhausted, and how the family and student contributions can play a role in reducing overall costs.”

The tool allows families to customize both expenses and available funding to adjust results for changes in students’ situations over the four years. The results show yearly and total estimated costs of attendance, available funding and projected funding gaps. The tool also provides informational tips on how to reduce costs and potential debt.

After viewing their results, users have the opportunity to enter the drawings. Two names will be drawn each week to receive $250 awards for educational expenses. In a grand prize drawing, two names will also be drawn to each receive $1,500 for the students’ college expenses in fall 2017. The grand prizes will be paid directly to the students’ colleges.

For details and complete rules for the giveaway, visit www.IowaStudentLoan.org/Giveaway. Or, to begin the College Funding Forecaster and enter the giveaway, go to www.IowaStudentLoan.org/Forecaster.

By: Iowa Student Loan

What to Do If a Financial Aid Award Is Inaccurate or Incomplete

When that financial aid award notification arrives, check it carefully. Here are some circumstances you may run into and what you can do.

Situation What to Do
Contact information is incorrect. Contact the financial aid office with updated information. The student should also log in to the FAFSA portal to update information.
Financial information has changed since you submitted your FAFSA. Contact the financial aid office about drastic financial changes due to loss of a parent’s job or other circumstances.
The student wants to be considered independent for financial aid purposes due to a severed relationship or abusive situation. Students with extenuating circumstances in regard to their relationship with their parents may contact the financial aid office to clarify the situation and determine the dependency appeal process.
An expected federal or state award is not listed. If the student qualifies for but didn’t receive a federal or state grant or scholarship, first determine if the award is automatically granted to all eligible applicants.

  • If an automatic award wasn’t received, contact the agency responsible for administering it and notify the financial aid office.
  • If the award is not automatic, funds may not be available for all applicants. You may try contacting the agency administering the award to see if any remaining funds will be awarded later.
An expected institutional award is not listed. Not all awards are automatically granted to all eligible students. If the FAFSA was filed by the college’s priority deadline, contact the financial aid office to determine if any institutional awards are still available. If the award was offered by a specific department, ask a financial aid representative if the office has been made aware of the award.
A state or federal award was submitted to the wrong college. Contact the agency responsible for administering the award. Also notify the financial aid office and the financial aid office at the other institution of the mistake.
An unexpected award is listed. Many colleges consider an application for admission to also be an application for other institutional awards. If the student doesn’t meet the qualifications for an award, contact the financial aid office to clarify.
A grant or scholarship awarded by an outside entity isn’t shown. Tell the college about all grants and scholarships received. If an award is missing, contact the financial aid office.
A work-study award is listed. This award may be dependent on the student finding a work-study position and earning a paycheck based on hours actually worked. Start with the financial aid section on the college’s website. If that doesn’t contain information about how to locate and apply for work-study positions, contact the financial aid office.
Not enough aid was awarded to cover costs of attendance. If there is a large difference between aid and costs, some options to consider are:

  • Contacting the financial aid office to inform them of the situation and see if any additional aid is available.
  • Increasing student employment to earn income to cover the shortfall.
  • Asking about monthly payment plans.
  • Exploring less expensive education options, such as a public university or community college.
  • Relying on gifts or federal PLUS Loans for parents to help pay for college.
  • Taking out private student loans to cover the remaining expenses.

By: Iowa Student Loan

Registration Still Open for College Scholarship Program

Registration is still open for a scholarship that offers Iowa high school seniors a chance to receive one of 30 scholarships worth $2,000 for college while learning important financial literacy skills.

“I’m incredibly grateful for Iowa Student Loan and the Financial Know-How Challenge Scholarship. The financial rewards as well as the skills I learned when applying will be a huge help to me … as I strive to pursue my dreams in a way that is financially responsible.”

— Ryan Wagner, a 2017 graduate of Fort Dodge High School and a recipient of the 2016–2017 scholarship

The Iowa Financial Know-How Challenge: Senior Scholarship is open to legal U.S. citizens who are residents of Iowa; are seniors at an Iowa high school during the 2017–2018 school year; and attend college in fall 2018. It is a no-purchase-required program, and full rules and details are available at www.IowaStudentLoan.org/SeniorScholarship.

Register Today!

High school seniors may register for the Iowa Financial Know-How Challenge: Senior Scholarship by Feb. 16.

Iowa Student Loan® will award the $2,000 scholarships to students who complete two online financial literacy tutorials and score highest on a related assessment. Registered students also receive emails highlighting financial literacy tips, such as the importance of early career and college planning and ways to reduce student loan indebtedness.

The two tutorials — Student Loan Game PlanSM and the ROCI Reality Check — were developed by Iowa Student Loan to help students understand the consequences of college borrowing and discover how to maximize their return on college investment, or ROCI.

A related multiple choice assessment checks students’ understanding of the concepts in the tutorials. If top-scoring students tie, those students will be asked to write and be judged on a short essay so winners can be determined.

“Each year, we hear from participants and parents that this scholarship campaign helped them understand how they can minimize college debt,” Christine Hensley, Iowa Student Loan board chair, said. “Our hope is that they also tell others, who can then also use our online tools to reduce borrowing as well.”

In addition, each recipient’s high school will receive a corresponding $500 award.

The Iowa Financial Know-How Challenge: Senior Scholarship is open to legal U.S. citizens who are residents of Iowa; are seniors at an Iowa high school during the 2017–2018 school year; and attend college in fall 2018. It is a no-purchase-required program, and full rules and details are available at www.IowaStudentLoan.org/SeniorScholarship.

By: Iowa Student Loan

 

 

How to Handle Multiple Acceptance Letters

Sometimes the most nerve-wracking part of the entire college admissions process is making the final decision. If you received admission or acceptance offers from more than one of your top choices, these tips can help you choose.

MultipleAcceptLetters_infographicDownload a PDF of this infographic.

  1. Be sure you know how soon you need to make a commitment by comparing dates provided in your admissions packet. (Most colleges and universities give you until May 1 to respond.) If you were admitted and met entrance requirements, you may have some time yet to consider your final choice before you miss the first deadline.
  1. Rank your options. Order your choices based on how well each school fits your needs.
  1. Get student perspectives. If you haven’t already, revisit campus and talk to students. Online resources — like social media, blog entries and comments, and reviews — are also great resources. You can learn a lot of helpful information from those who have been there.
  1. Delve into the nitty-gritty. Look up student retention rates to see if a high proportion of freshmen don’t stay in school; graduation rates for four, five and six years; and job placement rates after graduation. Freshmen do or don’t stay for myriad reasons, but an unusual proportion may indicate an issue you would also face.
  1. Look at your major specifically. How many students are in your major? Do they have trouble getting into the classes they need? Check out the list of required classes for your major and compare that to the number of sections available each semester in the school’s course catalog. Don’t forget to search for online reviews or comments specific to your intended major.
  1. Look at your bottom line. Your total cost to get through all your undergraduate years should be a major consideration. A good financial aid package may move your second or third choice up to the top spot. If a lack of financial aid is keeping you from choosing your favorite school, consider contacting the admissions office to let them know money is preventing you from accepting. If you’re a desirable candidate, they may be able to help with a little more financial aid, depending on their budget.
  1. Commit to one school. You should not agree to attend more than one school. Not only are you likely to lose at least one deposit, a school may rescind its offer if it finds out you are accepting additional offers. The only exception to this is if you are wait-listed at your No. 1 choice; in that case, you may decide to accept your second choice while you wait to hear. Just be sure you notify the second school immediately if you get in at your first choice.

By: Iowa Student Loan

Applying to College

You’ve been considering colleges for a while now; visit booths at college fairs, perusing websites and pamphlets, and even venturing out on campus visits – all the while looking for that perfect campus that says home away from home.

Well, the time has come to start applying if you haven’t already. October is College Application Month and now is the time to make some decisions about what colleges interest you enough to fill out that application and hit submit.

The application process is actually a lot easier than most people think, but depending on where you decide to apply there can still be some steps to the process.

Step 1:
Narrow your choices. You should apply to 3-5 schools to keep your options open. You want to apply to your top schools, but you also want to make sure your final list includes a safety school. What is a safety school? It’s a school that you know you’ll get into and that has your program of interest. You want to always have a back-up plan and your safety school is your admissions back-up plan.

Step 2:
Review each school on your list and determine their application process and requirements. Are the applications online free? Is there a benefit to applying on campus? What pieces of information are required such as ACT score, GPA, letters of recommendation, or essays? Make a list for each school and then begin compiling everything you need.

Step 3:
Fill out the application. Be thorough and don’t leave anything blank. If you have to submit additional information, be sure you proof read everything and check off each item as you submit it to the school.

If there’s an essay make sure you are following all the instructions. Some schools will provide a prompt or topic they want you to write about. Others may simply ask for a personal statement. Remember that you can reuse certain parts of essays but be sure to tailor each essay to the specific shcool

Once you’re organized, the application process is pretty straight-forward. Just remember to take your time and be yourself on your applications. Try and submit your applications by early to mid-November so you have plenty of time to focus on scholarship applications at each college. And remember, you can also be working on your Free Application for Federal Student Aid (FAFSA.)

That’s about it. Now get out there and submit those applications.

Contributed by: Iowa College Access Network

This is Contributed Content. Any opinions, advice, statements, services, offers, or other information contained in Contributed Content are solely those of the respective author(s) or contributor(s) and do not necessarily state or reflect the opinion of Iowa Student Loan and/or this blog. See the “About” page for additional important information about Contributed Content.

Registration Opens for College Scholarship Program

Scholarship Gives 30 Iowa High School Seniors Chance at $2,000,
Educates Them on College Borrowing and Personal Finance

Registration is open for a scholarship that offers Iowa high school seniors a chance to receive one of 30 scholarships worth $2,000 for college while learning important financial literacy skills. In addition, each recipient’s high school will receive a corresponding $500 award.

2017 Scholarship recipients with then Iowa Governor Terry Branstad.

High school seniors may register for the Iowa Financial Know-How Challenge: Senior Scholarship at www.IowaStudentLoan.org/SeniorScholarship between now and Feb. 16. Iowa Student Loan® will award $2,000 scholarships to 30 students who complete two online financial literacy tutorials and score highest on a related assessment. Registered students also receive emails highlighting financial literacy tips, such as the importance of early career and college planning and ways to reduce student loan indebtedness.

After registering for the scholarship, students receive emailed instructions for completing the three required online components. The two tutorials — Student Loan Game Plansm and the ROCI Reality Check — were developed by Iowa Student Loan to help students understand the consequences of college borrowing and discover how to maximize their return on college investment, or ROCI.

A related multiple choice assessment will check students’ understanding of the concepts in the tutorials. The 30 high school seniors who score highest on the assessment test will each receive a $2,000 scholarship that will be sent directly to their colleges in fall 2018. If top-scoring students tie, those students will be asked to write and be judged on a short essay so winners can be determined.

Each scholarship recipient’s high school will also receive a corresponding $500 award to be used toward scholarship and financial literacy programs.

“I’m incredibly grateful for Iowa Student Loan and the Financial Know-How Challenge Scholarship. The financial rewards as well as the skills I learned when applying will be a huge help to me … as I strive to pursue my dreams in a way that is financially responsible.”

— Ryan Wagner, a 2017 graduate of Fort Dodge High School and a recipient of the 2016–2017 scholarship

 

The Iowa Financial Know-How Challenge: Senior Scholarship is open to legal U.S. citizens who are residents of Iowa; are seniors at an Iowa high school during the 2017–2018 school year; and attend college in fall 2018. It is a no-purchase-required program, and full rules and details are available at www.IowaStudentLoan.org/SeniorScholarship.

Register Today!

By: Iowa Student Loan

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