If you're the parent of a high school sophomore or junior, college planning shouldn't stop at finding the right school and the money to pay for it. It's also about introducing your teen to money decisions he or she will be making after leaving home.
What's a good way to blend teaching new skills with key dates in the college application and decision process? Build a college-planning calendar you and your teen can follow. If your high schooler is an eager, self-motivated student, it's never too early to start this conversation and the work involved. Depending on your family's finances and the teen's time to graduation, here are some events to put on an annual calendar.
Winter
Based on your resources and college planning so far, start evaluating potential schools with your teen. The U.S. Department of Education's College Affordability and Transparency Center features a range of calculators and resources to help you narrow down school choices with the chance for your teen to secure the most scholarships and grants - money that doesn't have to be paid back.
Consult trusted friends and family members for their advice on affording college and strategies to secure grants and scholarships. Resources like FinAid.org and Edvisors.com are good resources for ways to afford college, but it also helps to have face-to-face expertise.
It may also make sense to kick off the year with a visit to a qualified financial and tax professional to confirm your situation. You might consider springing for a separate advisory session for your teen so he or she can get a good start putting finances in order. January is also a good month to learn about the Free Application for Federal Student Aid, better known as the FAFSA, as it's best to fill out the form right after Jan. 1 to avoid missing out on available federal and state aid going into your teen's freshman year. That first FAFSA filing will give you an idea of what your Effective Family Contribution (EFC) will be.
Finally, many organizations that give grants and scholarships look favorably on volunteer or internship work your teen engages in during their high school years (many colleges favor this work as well in admissions considerations). Many organizations start their summer hiring and evaluation processes after New Year's Day, so the earlier your teen applies, the better.
Spring
Springtime is a good season to start talking about summer jobs. Why not broaden that discussion to your teen's money management and work transition from high school to higher education? College students actually start competing for paid and unpaid summer internships in the fall and winter, which is good for incoming freshmen to know. If you are expecting your teen to contribute some part of his or her earnings or savings for future college costs, it's worthwhile to review budgeting, taxes, and savings basics for particular college goals. Also, if your teen hasn't been exposed to banking on a regular basis, it's time. Compare fees and services on various checking and savings accounts and consider whether it might be wise for you to bank with the same institution to allow for easier transfer of necessary funds from your account. Also encourage your teen to find an organized way of keeping track of finances on paper, on a computer or online.
If your teen is a freshman or sophomore, it's wise for him or her to start evaluating the course and volunteer work that will help bring in college acceptance letters. The better your teen's preparation and academic record, the better the chances of getting into specific programs and qualifying for grants and scholarships to offset tuition costs.
Summer
Summer is a time for fun, but it's also a good time to research potential schools, scholarship programs and even take a quick campus tour. The U.S. Department of Education's scholarship site offers basic guidance for finding such money and local companies and organizations - including places where your teen may work or intern.
If your teen is heading into senior year, the fall is going to be busy. Add admissions test dates and college admissions deadlines to your calendar as soon as possible. Also, budget for college application fees as well as fees for admissions prep tests and the main SAT or ACT tests (more on that below) which may cost well in excess of $50 based on which test - or tests - your teen needs to take.
Here's another savings idea for your teen if he or she is earning income during the summer. If your teen is under age 18, help him or her set up a Roth IRA. You and other relatives can even offer to match deposits up to their total annual 2015 contribution limit of $5,500. Yes, the focus of a Roth is retirement, not college savings. But having your teen put away at least a bit of earnings while in the lowest possible tax bracket allows decades of tax-free compounding that will be beneficial at the end of a long working life. It will also give your teen a broader view of lifetime financial goals than the immediacy of paying for college.
Fall
Fall is the season for college admissions tests, but for students with extra time before graduation, it's also the season for test prep. Higher-scoring students on such achievement tests are generally in a better position for admissions or certain types of financial aid. High-school sophomores take the PSAT as a primary qualification for National Merit Scholarships, but it also gives an early indication of how students may do during their junior year on their ACT or SAT test, whichever they are encouraged to take. Get your student to check directly with the colleges of his or her choice to see which tests they require.
Finally, the closer your teen gets to freshman year, the more specific the dates on the calendar. For college-bound seniors, fall is the time for narrowing down college choices after visits, interviews or auditions so applications can be sent. Once acceptance letters arrive, it's time for parents and teens to evaluate financial aid packages.
The key is for you and your teen to organize these key dates, goals and information to make the best plan for getting into college and managing money and resources once your student starts school.
Bottom line: A college-planning calendar can help parents and prospective students target desired schools, get necessary advice and break down funding obstacles. The key is to do it as early as possible.
Nathaniel Sillin directs Visa's financial education programs. To follow Practical Money Skills on Twitter: www.twitter.com/PracticalMoney
This article is intended to provide general information and should not be considered legal, tax or financial advice. It's always a good idea to consult a legal, tax or financial advisor for specific information on how certain laws apply to you and about your individual financial situation.