June 24, 2015
On May 16 Fidelity announced the results of its second Cost-Conscious College Graduates Study. This study showed that a high percentage of recent college graduates have no idea how much debt they accrued to obtain their degree. The study also concluded that nearly 40 percent of the respondents would have made different choices regarding their college education if they had a better understanding of the costs involved.
In the survey’s national sample of 750 graduates, they found that 70 percent had accumulated an average of about $25,000 in student loans and credit card debt. When those that recently graduated were shown these figures and an estimation of just how long and how much it might take to pay those loans off, the new graduates expressed surprise and even a bit of remorse. I like to stress the importance of how important it is to have a conversation with your kids about money, especially when it comes to college. You need to help them plan and weigh all the pros and cons of their education.
Ideally you should prepare for college costs before you start college. Not everyone is able to afford to go to college. Also, not everyone is able to put money away beforehand for college, but it is important to sit down and look at the true cost of going to college and evaluate schools based on the majors they offer.
With the FAFSA due in just a few days on June 30th, keep in mind the cost of debt accrued from going to college. Make sure that you are only taking out what you need and nothing extra. It may seem like extra money now and that once you are done with college you can pay it back easily but that is not always the case.
Please call us at 763-231-9510 to set up a time to come in and sit down with one of our advisors and get a free college analysis to find out how much you need to be saving now in order to pay for college.