Ways to Pay for College

TOM HUDSON: Finally speaking of new skills, if you`ve got kids or
grandkids, maybe yourself heading off to college next fall, you`ve no doubt
spent a few nights tossing and turning thinking about how to pay for it.
Tonight`s “Money File” with Donna Rosato has three tips you need to know.
She`s senior writer at “Money Magazine.”

DONNA ROSATO, SR. WRITER, MONEY MAGAZINE: If you have a child headed
off to college this fall, there`s an important item on your to-do list:
applying for financial aid. It all starts with filling out the free
application for Federal student aid, known as the FAFSA. But before you
submit your forms, there are some surprising facts that you need to know.
First, being an early bird is usually a good thing, but don`t file too
early. You can submit as soon as January first and there`s no deadline to
file the FAFSA, but most schools don`t review the applications until later
— typically March 1 for public colleges.

Instead, take that extra time to do your 2011 taxes, so you don`t over
or under estimate your income, mistakes that can hold up your application.
A second point is that there`s no such thing as making too much money to
apply for aid. One-third of families don`t file FAFSAs because they don`t
think they qualify, but nearly everyone is eligible for something, whether
it`s a scholarship, grant or a subsidized loan.

Finally, while parental assets are taken into account in determining
your ability to pay for school, your child`s assets have a much bigger
impact. Better to spend down your kids` cash down before you reduce your
own. I`m Donna Rosato.

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