Preparing for College Expenses as a Military Family

For military families preparing to send a student to college, it should come as no surprise that the cost of attending is rising. The average annual cost of attending a public, four-year, in-state university (including books, supplies, and room and board) was $26,000 in 2022, and $27,100 in 2023. Considering many programs can take four years or more to complete, the total cost can be well over $100,000 per student. Thankfully, there are some ways to help offset that amount and prepare for the expenses that come with higher education.

Cost-Lowering Decisions

Before getting into student financial aid, it’s important to consider what path the student will take to get their education. While program changes and plan diversions can happen, it’s always good to have a general idea of what the student wants to accomplish in their education before they begin.

• What program are they interested in?
• Do they need to attend a trade school or a university?
• Will they attend a four-year institution right away or begin at a community college and then transfer?
• Will they attend a private or public institution?
• Will the institution be in-state or out-of-state?
• Will the student live at home, on campus, or off campus (but not with parents or guardians)?

Each of these decisions carries an associated cost and it is a good idea to calculate what the totals would be in various scenarios, as cost is often a factor in decisions about higher education. Making compromises can also help lower costs, for example, a student who wants to attend a four-year university may agree to apply to a local institution and live at home to save money.

Federal Student Aid

The Free Application for Federal Student Aid (FAFSA) may be the most important form filled out for student financial aid. It is used to report the student’s personal and financial information, the student’s parent’s personal and financial information (if the student is not an independent student), as well as the prospective school information to the office of Federal Student Aid (FSA). After processing, FSA will provide a FAFSA Submission Summary to the applicant as well as to the schools selected. Keep in mind, applicants may choose to send the FAFSA Submission Summary to several schools, even before having been accepted into any of them.

The FAFSA Submission Summary provides higher education institutions with information regarding the student’s eligibility for aid like federal grants, loans, and even work-study programs.

• Grants are a form of financial aid that generally do not need to be repaid unless the student withdraws from school or does not complete an obligation for which the grant was provided.
• Loans are amounts of borrowed money that must be repaid with interest (unless the interest is paid for by the federal government as with a subsidized loan).
• Federal Work-Study is a program in which the government incentivizes an employer (usually the school) to hire a student part-time for at least the current federal minimum wage. Money earned is paid directly to the student to be used to help pay for education expenses.

State Student Aid

Some states provide student financial aid programs for state residents. It’s a good idea to check official state websites (usually ending in a .gov) for residency and aid requirements. An individual school’s financial aid office can also be a great resource for finding local financial aid.

Scholarships

There are numerous scholarships available to students and many of them go unclaimed. Like grants, scholarships normally do not need to be repaid. Who a scholarship is awarded to varies depending on the scholarship-giver. Some scholarships are based on academic achievement, interest in a subject, hobbies, community service, or financial need. Others can be based on demographics, athletic talent, or essay writing. A school financial aid counselor can help students in searching for scholarships. The U.S. Department of Labor’s free scholarship search tool is also available.

Some national organizations offer scholarships to veterans as well as their spouses, children, and even grandchildren. While searching for scholarships, keep an eye out for military-related sources. Organizations like AMVETS and American Legion offer scholarships directly from their websites.

While searching for scholarships, be sure to verify that the scholarship is legitimate before providing your personal information. Ask a school financial aid counselor for assistance if you’re unsure. Some companies may even try to charge students for financial aid services that are often free. Be diligent and avoid student aid scams.

Life Insurance Considerations for Students

Life insurance for the parent, guardian, or spouse of a student might seem like common sense. If a tragedy affecting the parent, guardian, or spouse were to take place while the student was in school, an active life insurance policy could help the student continue to pay for school despite the passing of a loved one who may also have been a source of financial support. What may not be so obvious is life insurance for students themselves.

If a student passes away while in school, loved ones may be called upon to repay the debt accrued from loans and other educational expenses. A term life insurance policy with a coverage amount sufficient to take care of funerary expenses as well as other bills could aid a family in crisis. For younger students, taking out a permanent life insurance policy is a great way to start building financial security at lower premiums than they might be charged later in life.