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11
Connecticut CPA
g
November/December 2016
College Funding Survival Mode
As any of you who have funded your
own children's college educations
already know, this process has a lot of
moving parts:
Federal and state financial aid
programs based on need,
Filing multiple forms (each with their
own rules) disclosing family financial
information in order to determine
need,
Institutional aid from the college
based on merit,
Tuition discounting, a pricing
practice some colleges use to
attract enrollees,
Tax incentives, and
Local scholarships.
Boiling in the background are tidal
waves of emotion at both the parental
and student level:
Is this school the right one for me?
This is my first child to "leave the
nest!" Is this school a safe place?
I want my baby's life to be better
than mine, and I'll do whatever it
takes to get that for her.
Well, if my friends are going to [an
expensive college on the list] and
I'm a better student than they are,
I should be able to go to [the only
college on the list that didn't offer
the student a scholarship].
Parents all want the best for their
children, but sometimes divorced
parents in particular get caught up in
the emotion and "brand shopping"
that is often part of the college search.
Does guilt play a part? Does paying for
an elite, brand-name college for the
child somehow make up for the pain of
divorce, perhaps buying their way into
a better life for their child? (Answering
that question with certainty is way
above my pay grade.)
When a divorce agreement is being
hashed out, both parties probably look
at the college funding clause in the
agreement and say, "Fine, it says we
will split the cost equally, so we'll worry
about that down the road."
I can tell you that, when the time
comes to actually pay for college,
divorced parents are probably the least
financially prepared of all the workshop
attendees I see. Why?
The cost of running two households
has pretty much crushed the ability
to add to college savings accounts.
Moving costs, second home down
payments, and legal fees often
consume savings at the time of the
split that might have been available
to pay for college.
When college time actually arrives,
sometimes old emotions get in the
way of rational discussion.
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