First Person: A Balanced Approach to Paying for College

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So how best to financially assist the little lad or lady getting ready to head off to college? Should you pay the full ride to enable him or her focus purely on studies? Let the new student experience the real world head on and tackle the costs for themselves? Or maybe meet somewhere in the middle?

According to a recent MSN Money article, "Professor Laura Hamilton interviewed some "really angry, bitter parents" as she researched why some students left college with little to show for their tenure there."

It went on to say, "The parents shelled out tens of thousands of dollars for their children's educations, only to see lackluster grades and degrees in all-but-useless majors that were chosen because they didn't interfere too much with the kids' socializing."

Having some skin in the game

A child who must pay for at least some of their schooling might take a more active roll not only in the schoolwork side, but in the financial side as well. Personally, when I went to school, I was responsible for a third of all costs. This meant that from tuition and books to entertainment and transportation, anything I spent money on, I was paying a part of. In this way, I was forced to think about and make more informed decisions upon where my college money was going.

At the same time, knowing that I was paying for a part of my education gave me a bit more incentive to work hard and do well, knowing that it would be wasted otherwise.

A little work adds to the appreciation of college

Personally, I found plenty to keep me busy and earning money during college to help me pay for my side of the expenses. My work during the school year as well as summer helped me build work ethic, but also made me appreciate my down times at school as well.

I tended to work seasonally -- largely during the warmer months -- which meant that winter was a slower period for me. I could catch my breath and focus purely on studies, reveling in the fact that I had largely covered my portion of costs in those previous months.

A pre-plan for kids

Having a pre-plan in place early on for kids heading to school can be a benefit for both sides. It can help both the child and parents know what they will be responsible for, and by using college financial aid websites, generally in what amounts. This can help parents start setting money aside and kids to start getting part-time jobs during the summer or school year to help save for college costs.

And of course there are different ways to go about deciding how much is paid and in what amounts. Personally, as I mentioned in my situation, each party -- mother, father, and me -- were responsible for a third of all my college costs. It was an even split among all budget areas.

For our children, we're considering splitting it more along the lines of parents covering tuition, room and board, while our kids cover things like transportation, books, supplies, entertainment, and miscellaneous costs. In this way, since they won't be paying things like tuition upon graduation, we'll be helping them better learn about and budget for the types of costs they will be likely to encounter after graduation. And hopefully, this strategy will also help the kids practice a bit more restraint in those cost areas that are more flexible and we as parents won't be blowing our tops when we get a $300 bar tab for a night out on the town.

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The author is not a licensed financial professional. The information provided in this article is for informational purposes only and does not constitute advice of any kind. Any action taken by the reader due to the information provided in this article is solely at the reader's discretion.


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