In today’s episode of “College Admissions Real Talk”, Dr. Legatt discusses how to avoid common mistakes when it comes to paying for college.
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VO: Welcome to College Admissions Real Talk with Dr. Aviva Legatt, a podcast for students seeking to get admitted to top-tier colleges. Each episode will feature an important tip for your college admission success, delivered with candor and love. If you’ve ever wanted to take a peek inside the mind of a college admissions officer, this is your chance. Have a question? Text Dr. Legatt at 610-222-5762. So, what’s your dream school?
AL: Welcome to College Admissions Real Talk. This is Dr. Aviva Legatt, founder and Elite Admissions Expert at Ivy Insight and author of “Get Real and Get In”. Today, we’re going to be talking about four mistakes to avoid when paying for college. So before going to college, I want you to be aware of some common financial mistakes that many people are making. Now, all these mistakes can’t necessarily be made before you go, but they may be made after you graduate. Graduate and you can plan ahead so that you avoid them. Mistake number one: waiting to pay off your student loans. So if you do take on loans for college, you may or may not know that you can start repaying some of those. While you’re in college, some of them won’t accrue any interest, and you can start paying accrue any interest. And for those that do accrue interest, it will save you money on interest to start paying a little bit each month towards your student loans. Some people are reliant on something called student loan forgiveness. And this is a 20 or 25 year program when you can have your loans forgiven, which means they go away. But what people don’t realize is that they actually get a tax bill for the amount of forgiveness. So let’s say you have $100,000 in forgiveness, which goes away. You’ll be paying a percentage of that to your taxes, which could be a five figure tax bill. So don’t necessarily wait for forgiveness to pay off your student loans. If you can start when you’re in college, even paying $50 a month, that could go a long way to helping you be financially free as close to graduation as possible. Mistake number two: not getting a job while you’re in school. So, I don’t want to say you shouldn’t focus on academics first, academics are really important, but so is work experience. Work experience is really helpful for your profession development, for your growth, and it can provide a really nice source of income while you’re in school and a really nice source of enrichment as well. Think about jobs you could have on campus, which would provide you with some great professional experiences and also give you some money in your bank account. This could help you towards loans if you need it or just to have some savings built up so that when you graduate, you have some money to spare if you need to get a new apartment or if you have some moving expenses or anything like that. Mistake number three: not applying for scholarships and medically-based financial aid. So there’s this guy named Jason White. He graduated from Florida state, and he received about $96,000 for undergraduate and law school, which accounts for interest by taking advantage of medically-based financial aid. So this funds students with chronic health issues, such as allergies, asthma, mental health conditions, and diabetes. For this kind of aid, you have to go through the state where you have residents in order to receive it. The challenge here is keeping up with the paperwork, making sure that everything is in and that you know where to turn to apply for this aid. You can also inquire with the colleges about any specific scholarships they could offer to you whether due to any kind of challenge that you have or financially or whether you have a qualification based on your academics. Finally, mistake number four: failing to check the interest rates and the loan benefits of the loans that you are getting. So contrary to popular belief, public loans are not always the better option for financial aid. repayment plans, adjustable refinancing options, and forbearance benefits among private and public loans. So oftentimes, public loans do provide more benefits, but the benefits vary based on policy and my administration. So from one administration to the next, you can’t guarantee a certain set of benefits, but sometimes you can get unexpected benefits from a public loan. A private loan the benefits are going to be a lot more transparent and clear, and you have the ability to refinance more easily if needed. So I know this was true for me that private loans actually worked better for me because I didn’t have the best interest rate, and I was able to consolidate my prior undergrad and graduate and it’s been a lot easier now that there’s some new benefits coming in for past loan. So I’m having a little bit of FOMO. So again, it’s really a personal decision, but you should weigh the pros and cons based on what’s happening out there. So avoiding these mistakes will help you to succeed in your next educational and professional steps. Smart money choices provide a positive building block for your future. Cheering you on.
VO: College Admissions Real Talk is hosted by Aviva Legatt, edited by Stephanie Carlin, and produced by Incontrera Consulting. I’m Caroline Stokes and this has been your daily boost of college admissions insight. Have a question? Text Dr. Legatt at 610-222-5762. For more information on Dr. Legatt and Ivy Insight visit www.ivyinsight.com. And you can pick up Dr. Legatt’s book, “Get Real and Get In”, at major retail outlets across the world. Insight out.