Nowadays, it is very costly to pursue a college education. Hence, students will have to find all ways to pay for it. It is good to start a saving plan early for your children’s college education when they are still kids.
Normally, parents will take up the responsibility to start a college education fund for their children. Some grandparents also chip in to help. In fact, if both parents and grandparents play a part in helping to save for the kids’ education, it is easier to come up with enough money for the college education.
Here are some suggestions which grandparents can consider if they want to help their grandchildren with the university tuition fees.
Instead of buying birthday gifts to the grandchildren especially they are still quite young, grandparents can consider give a cash gift to the parents. This cash gift can add to the grandchildren education saving fund.
Do you know that grandparents can assist their grandchildren in qualifying for scholarships and grants? Unknown to a lot of people, there are awards available for grandchildren of certain groups of people. As a grandparent, you should make effort to find more about these scholarships and grants which can sponsor your grandchildren to go college. It is worth every effort and time to find out because it can be a great help to your grandchild.
By helping to make contributions to grandchildren college saving plans, it brings benefits to both grandparents and grandchild. When a grandparent takes up a 529 college savings plan for his grandchild who is dependent of his parents, this is not reported on the student’s financial aid application. Thus, the child can qualify to more help as compared having their parents owning the plan instead. Also, this college savings plans provide an alternative for the grandparents to transfer their assets out of their names.
Alternatively, a grandparent can co-sign with his grandchild for a student loan. However, do bear in mind that if your grandchild which is the student defaults on the loan, the responsibility of the repayment lies on you as the grandparent.
If a grandparent has retirement fund, he can borrow to help his grandchild to pay for the college costs first. By taking this path, you must remember that you will have less time to have the money back as compared to the student will with a student loan.
In fact, one of the most wonderful gifts that a grandparent can give to his grandchild is a college education. Before you start to take up any option, it is good to pause and think through it carefully. Getting the right option, it will work very well for both grandparents and grandchildren.