Angela Costello: [00:00:00] Great.

Perfect. Alright, and so for those of you joining us, welcome. Thank you so much for joining in tonight. Um, and for anyone who has to cut out a little early, just wanted to assure you that this is being recorded and the recording will be emailed out to you within a few days, so don’t worry, we’ll all be receiving that in your inboxes.

Um, my name is Angie and I am the teen librarian at the East Bridgewater Public Library. Um, and I am joined today by Julie, who’s gonna be doing the, the bulk of the talking this evening. She’s our expert. Um, and Julie is the senior Director of college planning, education and training at Mifa. Uh, she joined Mifa back in 2007.

In her role provides expertise related to planning, saving, and paying for college to families, colleges, and other organizations. Prior to joining mifa, Julie worked for the college board, Nellie Mae and American Express, and was the director of Financial Aid [00:01:00] at the Harvard Graduate School of Education.

Julie has been involved with Mafa in a variety of positions and committees since 1993. She holds degrees from the University of Massachusetts, Amherst, and the Harvard Graduate School of Education in Cambridge. So Julie, I’m gonna pass things over to you.

All right, Angie. Thank you so much. And it’s so good to be here.

And I’m gonna call share my screen and, oh, let’s see. Can I do that? Yes. And I’m just going to pull up the presentation.

There, it’s great. So tonight we’re gonna talk about early college planning. And so that can be, if you have young children, middle school children, high school, uh, children, I think there, there’ll be something, a little bit of everything here. And, um, you can also ask your questions. So I guess I’ll go to this slide.

Um, you can put your [00:02:00] questions in the q and a and that way if we don’t cover something or, you know, we cover something and you want a little more explanation, you can ask and, and we’ll, we’ll dive in there and let you know. Um, as Angie mentioned, uh, we will record this and we’ll also send you these, uh, a link to these slides, um, in a couple of days as well.

And if you need closed captioning, you can hit the CC button and you’ll get a live transcript of the, the words that we’re speaking. So a few words about Mifa. Mifa has actually been around since 1982, and we were created by the Commonwealth of Massachusetts. A number of colleges got together to, um, insist on an organization that could help families plan, save, and pay for college.

Um, and we started out with a loan program back then, and we’ve expanded. Now. We have the state’s college savings programs, and other than that, we just do a lot [00:03:00] of work in the community with colleges, high schools, high school counselors, families, libraries, um, to give free guidance, um, about the whole college process.

So tonight, here are some of the things we’re gonna talk about. We’re gonna talk about how, you know, how do you begin to learn about post-secondary options. Uh, so we’ll talk about that. Uh, we’ll talk about why. Going to college is still a really important investment. We all know that it’s expensive, but why it can be a great investment for you.

And then we’ll talk about what it might actually cost your family. Then we’ll touch upon how our family’s paying for college these days, today in 2026. Um, some strategies for saving and we’ll talk about mi a’s, uh, two college savings plans. And then just some things you can do right now to begin to prepare.

[00:04:00] There’s always something you, you can be doing to, to learn, learn a little bit and educate yourself. Um, so the first thing this, I was gonna take this slide out just because it is from 2021, but it hasn’t been updated. The college board did a study, um, back then just to show the difference, um, in earnings over, you know, over time of.

People who have different levels of education. And you can see that starting at the bottom, people with less than a high school diploma and then getting up to high school diploma and some college associate’s degree, bachelor’s degree, master’s and beyond. And even though these numbers actually would probably be higher today, because, because that is a, a few years ago, you can see that with levels of education, um, in general, your income does go up.

And so just to make the [00:05:00] argument about it is a big investment. The college can be expensive, but it, it can be somewhat balanced by, um, a higher, uh, trajectory of, of salary and earnings over time. So that is still true today, even if these numbers are a little bit dated. And then let’s just talk about costs because we, we always just, you know, we hear stories and we know, um, that college is, is usually a big expense for families and it’s usually one of the bigger expenses that you have, um, in life.

You know, people sort of wanna buy a home and that’s a huge expense. And then college is another one of those big expenses, but it’s, it’s actually not one thing. There are actually so many choices of what you can do after high school and what types of education are available. And this is only a limited view into that.

But what [00:06:00] this shows is of the types of colleges starting at the top public, two year colleges or more well known as community colleges, and then it goes down public four year colleges and then public four year colleges out of state. And then private nonprofit colleges. And you can see there’s a huge difference, um, in the prices of, in the different sectors.

And I will add that here in Massachusetts Community College. So that’s the two year public colleges in Massachusetts are tuition and fee free for everyone, everyone. So, um, you still have to apply and you still have to fill out that FAFSA financial aid form just because that’s part of the process. Um, but the state kicks in where the federal government leaves off with financial aid making that community college tuition and fee [00:07:00] free.

So that’s hugely important. So we sort of bring that average down of this, the, this national statistic slide that I’m showing you right here. Um. You can see the other piece is that when we’re talking about college costs, we’re talking about tuition and fees, but also everything else too. Uh, room and board, books and supplies, all of that.

So sometimes when you hear of those huge costs, that’s because, um, you know, everything is included When you think about. The cost of a certain college. Um, I will also add that since this is a national slide, that some colleges in Massachusetts and New England in general has some of the most expensive colleges.

Some colleges have a, an annual cost of more like $80,000, um, when you take in room and board books and supplies, all of that. So, um, those numbers seem staggering, but the bottom [00:08:00] line is there’s, there is financial aid. We’re gonna talk a lot about that now. And so it really isn’t, um, it’s important to understand the costs, but really what’s important to you as a family is how much are we going to have to pay at these different colleges?

And then you make a decision based on that. So that would be the costs minus any financial aid.

And Julie, just to double check on that previous slide Oh yeah. Are, are those costs per academic year?

Yes, they are. And that’s a great question. Yes. Yeah. And so a little more about these types of colleges. So we talked about community colleges.

Um, it’s, it’s a, a good path for many students to begin at a community college, especially given the cost these days in Massachusetts. And then you can transfer to a four year college after that. So that can be a very affordable choice. So I’ll [00:09:00] start there. Um, but again, four year public colleges. That would be, you know, Bridgewater State University, uh, Worcester State University, UMass Amherst, UMass Dartmouth, all those are all your public four year colleges.

And then four year privates of course are, um, you know, your, your Harvard Stonehill, Tufts, Northeastern bu, um, four year private colleges. And then I’ll also share that these days students are really thinking their path. And another really great option could be a vocational or technical school, a school where you learn really concrete skills, can, can graduate and have a fairly well paying job.

And then, you know, you might love that job and continue on with that, or even you go back to school afterwards, but at a point where you’re [00:10:00] building skills, um, the whole way. So you have lots of options. And for students to be able to explore all of those and really try to find what’s a good fit for you and not just go on the path because a number of your friends are, are doing that because there really are so many good options for you.

Okay. And again, these are the costs that you saw on the previous slide. And I’ll mention too that Mifa has a free web portal for students in grade six through 12, actually called Mifa Pathway, where you can log in, create an account for free, and you can take a number of assessments to learn about, you know, what skills do I have, what are my interests?

Uh, you can do some career exploration, college exploration. There’s financial aid information in there, and it’s sort of done in a fun and engaging way, [00:11:00] really starting in sixth grade. It’s really gamified. Um, but the other nice thing about it is once you have an account, you can save all your information in there and go back in and, and adjust it as you move through school and learn more about yourself.

Um, so I put that out there to you as a, as a free resource if you’d like to. Play around with it. And actually you can see we on the front, we have a, um, a video from Governor Healy who talks about this as being a, a good option to start on your journey of figuring out what your next step after high school will be.

And so, yeah, I guess the first and hopefully fun part of the whole college application process could be just to start researching colleges and, and learning about them. Um, and there are some online tools, uh, the first two college navigator.gov. And college [00:12:00] scorecard.ed.gov are government websites, but they actually have a, a wealth of information.

So you could put some information in about yourself and say, I’d like to stay in Massachusetts, or I’d like to stay in New England, or I wanna go to California, uh, whatever it may be. Um, and then you might say, I’m interested in nursing programs, or I’m interested in engineering, or, I don’t know. So I’d like to take liberal arts to start.

Um, and then after you, you put in some of that criteria, it will bring up a list of colleges that you can explore and. Just kind of fun to do on your own time. It will share, you know, where they’re located, how many students, but then gets, it, gets into real detail. As you look here on the screen. It will give you information about, um, the net price, meaning how much that cost minus the financial aid.

What’s a common average price that a family [00:13:00] or student pays to go there? Um, the, the majors and how many people are in each major and what athletic teams they have. And, um, uh. Do students have to borrow a lot and you know, what do they graduate with a debt level. So there’s just lots of great information to explore about all these different colleges.

And then the bottom two I told you about Mifa Pathway, which is MI a’s college search tool, works kind of the same way you put information about in about yourself and what you want and it will give you a list. And then the fourth one is Big Future and that’s from the college board. Uh, and that’s another great college search tool and gives you, again, a wealth of information about different colleges.

So the research part hopefully will be be fun. And really you, you wanna think about all of these factors when you’re thinking about, um, what type of a school you might [00:14:00] like to go to. So institution size and location. And I’ll even start by saying, when you first start thinking about it, you might have no idea.

You might think, how do I know if I want to go to a large school or a small school? And how do I know if I wanna be? Well, you might know the second part better. You might know if you wanna be in a city or in a more rural area. Um, you might have a comfort zone or you might really wanna change where you grew up and do something a little bit different.

So you might know that one the size. I always think, how would you know? So sometimes that takes visiting a couple of colleges, a larger school, a smaller school, walking around, talking to some of the current students to maybe get a sense of. What you like better, what feels more comfortable to you. Um, so, but that’s something that will be important in the end so that you feel comforted at your choice.

Um, [00:15:00] some other things you wanna think about are academic fit. You really want to be with students who are somewhat like you academically. You know, of course you wanna be surrounded by students who will challenge you a little bit, but it, it’s, it’s comfortable to be, um, at a college where students sort of have similar study habits and, um, are sort of at your level as far as what you wanna get academically out of that college.

So colleges all have something called a, a school profile, and they, they show you statistics from the, the students who were admitted the year before you will be. And it will give you information about what were the average grades, um, if there was a. Test like an SAT or a CT that they wanted, you know, what were those scores?

Um, so it’s kind of nice to look at that profile and think about does this sound like a fit [00:16:00] for me? And of course, if you know what you wanna do in college and you have an intended major, again, such as nursing or engineering, or biology or English, um, then you just wanna make sure that the college has that major.

And you also maybe wanna even make sure you know the size of that major. Um, so that, you know, will you be in a, in with a group of students that’s so small that maybe, um, it’ll be challenging to, to. Get all the classes that you want in that major or is it a major that has a pretty good group of students and there are plenty of classes and um, all of that.

So those are things to explore. And then you probably from high school will have a good sense of your learning style. Do you like to be in classes where there’s a lot of discussion or do you sort of like to sit in the back, take it all in and go home and study And uh, those things will be important [00:17:00] too, as you think about maybe the size of the institution, the size of the classes, how their classes are run, and things like campus culture and activities.

I think you can get a good sense of that by visiting a college, but also by colleges have social media accounts. You know, so look, seeing that way, what’s happening on, on those, on the campuses that you’re looking at, talking to students, talking to someone in the admissions office, um, if you have certain activities that you like to do, do you like to hike on weekends?

Do you wanna make sure your college is located in a place that will allow you to do that? Do you like to, are you interested in theater? How does the college have a theater program? So good to explore all of that. And then most colleges have study abroad programs and career and internship services. So that’s pretty much a given wherever you go.

But if you are particularly interested in those [00:18:00] things, you definitely wanna have a conversation about those things. And then affordability. And yes, we, we, we talked about that already, that it’s important to just understand how much a college costs and how much financial aid is available. Um, and that is definitely a factor.

Um, we, we’ve talked about going on campus. You can walk on a college campus anytime, and I think that’s fun to do. Walk around. They’re usually very pretty. Um, you can see what students are doing. Are there activities happening? Um, do you want to go to a sporting event or a music event? Uh, you can always do that once you get to be a junior in high school, I’d say though, if you’re going to go on a college campus, you should call the admissions office.

Let them know you’re coming. Um, and maybe attend an admissions presentation. Maybe do a campus tour with a student, [00:19:00] um, because. Once you’re in the admissions system, that’s a good thing. They, they know that you’re interested, you visited, you have questions. So, um, I’d make more of a formal visit. And on a tour, for example, you’ll get to see parts of the campus that you might not otherwise, like a dorm room or the, the dining hall, things like that.

And another place you can learn a lot about colleges is at a college fair. And there happened to be two organizations that hold a lot of college fairs, nacac, national Association of College Admissions Counselors, and NAC Act, new England Association of College Admissions Counselors. And if you go onto either of those websites, you can see, uh, what college fairs they have coming up.

In the, in the coming year. And that’s a way that you can actually be right in your backyard and yet [00:20:00] meet college representatives from colleges really all over the country. So that is a terrific way to explore without having to, you know, travel to Ohio for a school that you don’t know if you’re really interested in or not.

But you can meet the representative at a college fair and learn a lot about the school, um, before you would ever decide to take a trip.

And then the affordability piece. So here are some ways that you can sort of assess how affordable a college will be for you and your family. So there’s something called a Student Aid Index Calculator, and actually we have a, a very well used one on our website, [email protected]. SAI stands for Student Aid Index and that calculator.

Ask some questions, um, as will be asked on financial aid applications when you’re ready to do that. And [00:21:00] then from those questions, it’s a formula and it will spit out a number, which is your student aid index here, SAI. Um, and that is just a rough estimate of what you might be expected to pay for college as a family.

It’s gonna look at your income, your assets, how many people in your family, things like that. So that’s just a, a good idea when you’re planning and thinking about this, um, to have a sense, am I going to be expected to pay 5,000 or 20,000 or 50,000? Um, again, you don’t make hard and fast decisions, um, with estimates like this, but they can be really useful to know.

And then one step further from that is that net price calculators are usually on most college websites. And not only will that give you sort of that SAI number of what you might be expected to pay, it could also tell you [00:22:00] what financial aid you could expect from the different colleges. So those are also good calculators to play around with.

And I, you really can play around with them because it’s just. Just for the purposes of you planning, getting a sense of what the cost may be to you. Um, and again, um, these other sites, college Navigator Scorecard will also give you information about that, um, maybe, you know, families in this income band end up paying this much at this college.

And, um, we also have another tool called the College Cost Projector. Um, so all of that is there just for you to play around with and get, get a sense of what a specific college or college in general might cost you.

And Julie, I’m just gonna chime in for a moment. Yeah. Because we have a couple of questions.

I believe one of them you’re going to be answering very soon. Um, but [00:23:00] I do want to address a question someone has about whether the cost varies with immigrant or international students.

That’s a great question. So yes, let’s, let’s, let’s cover that and then we will talk about it some more. So, um, so yes, so the cost is the cost and then financial aid, federal financial aid, um, is only for US citizens or permanent residents.

So when you apply for financial aid, which we’ll talk about through the fafsa, you would have to be eligible for federal financial aid to do that. However, um, here in Massachusetts, um, we now have a tuition equity law, which makes it so that, um. Undocumented students who aren’t eligible to apply for the FAFSA for federal aid are, can be [00:24:00] eligible for Massachusetts State Aid, including in-state tuition and a number of scholarship and grant programs that are available to, to everyone.

Um, so the form that, um, if you’re in that situation that you would use is called the mafa. And, um, we have all kinds of information about that on our website and some webinars about that. So that has been a very nice benefit here in Massachusetts that can make college affordable for, um, you know, US citizens and permanent residents as well as undocumented students.

Now, international is a tiny bit different. Um, so. If you are currently an international student, then yes, you, you won’t be able to apply for federal aid and um, [00:25:00] you will have to pay, say, out of state costs, um, for if, if you’re international. So that’s a a little bit different. International students do end up usually paying a little bit more because there’s less financial aid available.

However, some colleges, you know, that have their own grant and scholarship programs, um, have a lot of international aid and do award that. So you should always look on the financial aid section of the, of the website, of the college that you’re interested in and get all of that information, um, and know, then know.

Depending on your situation, what route to take to apply for the financial aid that’s available to you. So that’s a great question.

Alright. And then we’ll move along and we’re seeing college scorecard again here, but I think that’s just to show you that you can get all kinds of information and [00:26:00] even a lot of information about, about costs. Um, and even as you can see here, there’s even some statistics and data about median earnings of someone who graduates from a four year program at a certain college or graduation rates, which can um, can be a good data point as well.

The higher of course the better, um, which would indicate, um, you know, more support to get students through. So, um, so that’s just good to know as well. Oh, and here’s, so now showing everything that we, we talked about, but um, here’s a net price calculator for Framingham State, and you can see that it puts in all of the information about the total costs, but then gives an estimate of what, whoever was using this calculator put in their information.[00:27:00]

And it’s saying you might be eligible for a merit scholarship, a need-based grant, which would bring the estimated price for you student to 15 3 40. So you could go in and use this calculator and get your own estimate. And that’s, that’s, that’s a big difference. 31 to 15 there. So.

So here, yes. Is we’re gonna talk a little bit more about Massachusetts financial aid. So, um, mass Transfer is a website that you can go to that really talks about all of the options for a student to start at a community college and then transfer to a four year public. Um, as I mentioned, it can make it.

So affordable where there can be guaranteed credit transfer some tuition credits, freezes, freezes on tuition. Um, that can be a really affordable option for students. And [00:28:00] Mass Educate is the, um, program, which means the free community college for everyone here in Massachusetts. And I’m gonna skip to the bottom.

The Mass Tuition equity law, that’s the one that I told you about, that undocumented students can apply using the Mafa form and um, be eligible to receive Mass State financial aid and in-state tuition rates. So that’s terrific. And the last one, I’ll go back up to Tuition break. Tuition Break is a program where students can apply to a public.

University in a neighboring state and cer if they attend certain programs in those colleges, can actually maybe pay Massachusetts in-state prices even though they’re going out of state. So that’s a great website to peruse and look and see if any of the programs out of state are ones that you’re interested in [00:29:00] knowing that if you apply to them and get accepted, that you could be paying an in-state Massachusetts rate.

And you know, we’ve been saying, mentioning financial aid. Financial aid, what is financial aid? Really, it’s any money that is gonna help you pay those college costs. We usually put it into three buckets. The first being the best grants and scholarship. That is money that is just awarded. To you, the student, and does not have to be repaid.

So that’s the best. But Work Study is also a program where you can be awarded a work study allotment, which allows you to work while you’re a student, usually on campus, usually for a small number of hours, and just earn a little cash each week. And that really can allow you, uh, to pay for your miscellaneous expenses, you know, shampoo and bus or [00:30:00] train fair and late night pizza, things like that, that you, um, so you’re not, um, yeah, so you’re not.

You know, strapped for, for money for day-to-day things, and a work study job can just be a really helpful thing to have on campus where you can learn some skills or maybe you meet some other friends, um, or you could just, you know, get a really easy job where you sit, say in the athletic center at the desk, and you just have the clicker that you have to click the number of people who are entering and leaving so that it doesn’t go over capacity and you get to do your homework and get paid for it.

So there are all kinds of jobs on campuses that can be, can be, you know, suit your, whatever you’re looking for. And then student loans. Now student loans doesn’t feel like aid when you, when you hear the, the term loans, uh, because you do have to repay your student loans. But let me show you why [00:31:00] certain loans, federal student loans really are, um, a little bit special and why they are considered financial aid.

And actually I’m gonna go, here we go. I’m gonna talk about those right now since we we’re talking about them. And I’ll go back. So the reason student loans, federal direct student loans are considered aid is that you, the student, are the sole borrower and there’s no credit check. For you to be able to take a student loan.

So those, that’s special because that doesn’t happen later in life. Um, and there are two types, subsidized and unsubsidized, and a portion of your student loans can be subsidized, meaning that the federal government pays your interest while you’re in school. So, um, no interest is even accruing while you’re in school.

If you have a subsidized loan, if you have an unsubsidized loan, that doesn’t happen. But either way, you don’t have to pay these loans [00:32:00] until six months after you graduate or leave school. So that’s also special. That doesn’t usually happen with loans either. Um, there is a fixed. I wanna say low interest rate, although the current interest rate that we have 6.39 isn’t super low, uh, because generally interest rates, um, have been high, but that does get reset every year, um, on about July 1st.

And then once you take a federal student loan at a certain rate, that is the rate for the whole life of the loan. So again, some things, no payments due when you’re enrolled in school. Um, when you graduate, if you take all of the federal direct student loans you’re eligible for, you can see those loan limits on the screen, freshmen, 5,500, sophomore, 6,500, and then 7,500.

For junior and senior year, you would be borrowing about $27,000. And when you graduate, that [00:33:00] would mean on a standard repayment plan, about $300 a month that you would be paying on your student loans. Now. Um, let’s say you graduate with an engineering job that is, you know, pretty good salary. Even for a, a first year graduate, you might have no problem paying that $300 payment, but many of you may graduate in different fields and may have to move into an apartment, may need transportation, and $300 might be too much for you to pay when you graduate.

And so there is a different option, um, where you can join an income based program, meaning that your student loan payment will be tied to your income and it can be a small percentage of your income, and you just sign up for that. And each year your tax, they have your tax returns to know, and they might adjust the payment as your income goes up.[00:34:00]

But that allows you to be able to manage your student loans and manage your first job. That may not pay you enough. Um, and, you know, if you need an apartment, you need transportation, all that. It allows you to manage that going forward. And then as your income grows and goes up over the years, you’ll, you’ll start stepping up those payments.

Um, or if it never goes up in the end, um, it can be forgiven after, after a lot, lot of years. But most of the time students will, um, end up earning more and end up being able to pay more to that loan. And always know that the faster you pay off your loan, the less you pay in the, in the long run. Alright, now I’m gonna go back actually, right?

Let’s see. Alright, so how do you apply for all this financial aid? Um, there’s one main form which is called the [00:35:00] fafsa, that’s the free application for federal student aid. It’s online. If you have, uh, your, you’re a parent and you have other children, you’ve completed this form before. If you’re a student and you have siblings or friends who have done this, probably when you hear words like fafsa, it makes your head spin because nobody ever likes, you know, talking about these forms.

But I will tell you, I’ve been doing this work for maybe 35 years, and this year is the first year I can say the FAFSA has never been easier. It’s, um, they made a lot of changes two or three years ago and. Unfortunately, when they first made the changes, there were technical glitches, so we weren’t able to enjoy the easier FAFSA for a couple of years.

But now it’s working and it’s pretty fast. Um, we have, um, families calling us this year saying, did I do something wrong? I did this [00:36:00] in five to 10 minutes and they didn’t. So don’t fear the fafsa. It’ll be available in October when you’re a senior in high school. October is when you want to complete the fafsa.

Um, you, you can do it anytime through the year, but why not get it done right away in October? Um, when you’re appli getting your applications together, do the financial aid form at the same time. So, um, the fafsa, every college requires it and just get that done. And I even mentioned that even if you’re going to community college, which is.

Going to be tuition and fee free. You have to do that FAFSA just to make sure that you get any federal aid you’re eligible for before the state then kicks in. But note that some colleges, and it’s usually the higher cost private colleges, um, may require an additional form called the CSS Profile form.

And that’s a form from the college [00:37:00] board. And so if you decide, Hmm, alright, I’m gonna apply to Northeastern, you would go to Northeastern’s, uh, admissions and financial aid page and you would see what forms are required. How do I do this? And you would see that it would say. We need the FAFSA and the CSS profile.

So you would know you need to complete the CSS profile. Um, also available October 1st when you’re a senior in high school. So, uh, just know that you’ve always filed the FAFSA and you may have to file the CSS profile if your school requires it. And then some colleges might have, again, on that website page, might have their own financial aid application, one pager or something online.

So look, just to make sure you don’t miss anything like that. And when you apply for financial aid using the FAFSA and possibly the CSS profile, you are applying for all federal aid [00:38:00] aid from the federal government, all Massachusetts aid and all the aid from the colleges and universities themselves. So really the, that one or two applications is, um, an application for.

All of the financial aid, so that’s nice. Um, and you can see at the bottom here, $205 billion in financial aid was awarded to students in 24 25. And so that’s, that is a lot of money. Most students receive something to help with paying for the cost of education. Um, the one, uh, process that’s a little bit outside of that is, um, looking for outside scholarships.

So let’s say your. Early on, keep, keep your eyes open for, does your high school have scholarships? Does, is there something in your town? Is there a Lion’s Club or something like that? Um, do your parents, employers, um, I [00:39:00] know CVS has a big scholarship for employees and children of employees, so just keep your eyes open for things like that around.

And also you can use online scholarship searches. So I’ve given you a couple here. Mifa Pathway also has an online scholarship. Search fastweb.com has an online scholarship search, and that would work kind of like a college search. You put in information about yourself and it will give you a list of scholarships you can apply to.

So I think it’s worth playing around with that and looking into that as early as possible. Just don’t pay a fee for a college scholarship search. These should be free. And allow you to research that. And you should not pay a fee and no one can guarantee you’re going to get a scholarship from somewhere.

So just be aware of that.

And then this [00:40:00] is how the college’s award financial aid in maybe one way or maybe both of these ways. Um, one way some colleges award financial aid is, um, by merit. So basically they’re trying to bring in the class that they want each year and they want the best students. So they sometimes give some merit grants and scholarships to students with, you know, good grades from high school or great test scores if they require a test, um, or maybe for sports or music or something else.

Um, but. Mostly it’s academics. So, uh, many times a college will award merit-based aid to, you know, the top quarter of the class or the top half of the class sometimes, um, to really encourage students to accept the offer [00:41:00] of admission and come because they really want the academically strong students. So the, the better you do in high school, uh, the more merit aid you may receive.

And again, that criteria is different from college to college. But, um, there are many colleges that offer merit-based aid. Um, there are some colleges that don’t, um, such as the Ivy League colleges or those colleges like MIT that compete with the Ivy Leagues. Um, they don’t offer merit-based aid. They offer all need-based aid.

And let’s talk about need-based aid because all colleges also offer need-based. And that is awarded based on the information that your family submits on those financial aid forms. So your income, your assets, how many people in your family that SAI number that calculation they do. Um, so there’s that standardized formula and [00:42:00] much of the aid out there is awarded based on your family’s financial need as determined by those forms.

And then, you know, some colleges do do both. Alright, so then, oh, is there a question,

Angie? So I think now might be a good time to ask this question. Um, and it is a two part question. So part one is, how exactly do parents’ assets affect the aid that a student can qualify for?

Such a good question, especially because we’re gonna talk about savings in a moment.

So that formula that I just talked about from the financial aid forms, um, that spits out that student aid index is very much income driven. So the biggest factor in determining how much financial aid you’re gonna receive, what, what your SAI number is, is parent income. So as your income goes up and you’ll, [00:43:00] you’ll see it feels like a lot as it goes up, you’re expected to pay more of that toward college costs.

So that’s going to make that student aid index higher and start lessening the financial aid that you can receive. On the contrary, assets affect that formula in a pretty small way. So, um. 5.6% of the assets is the maximum that they count toward how much you can pay. So for example, let’s say you have, I’ll, I’ll do two easy examples.

Let’s say you have $10,000 in assets and on the FAFSA assets are cash savings, checking investments, um, and other real estate if you have a summer home or something like that. So that would be your assets. So let’s just say you have $10,000 in assets. The [00:44:00] amount that that would affect your student aid index number would be $560.

So pretty low. You’d wanna have the 10,000 and have $560 be more be asked of you. Let’s say you have a hundred thousand dollars in assets, um, that the max that that would affect and increase your SAI is $5,600. So 5.6%. So again, it’s, your assets are counted, but they’re counted in such a way that you’d rather have the assets and be asked for a little more.

So, such, such a good question. Um, I will mention that because a lot of assets are not included on the fafsa. Um, but there are some other assets that people have, like equity in their home, um, retirement assets. Business assets, things like that. And [00:45:00] so what I would say is, let’s take each one of those. Um, the equity in your home is not counted on the fafsa, but it is counted on that CSS profile form.

So that could increase the, the number of assets that you’re taking, the percentage of, um, the next asset is that I mentioned retirement assets. Those actually are not counted. Your qualified retirement assets are not counted in either, um, either way in that formula and business assets. Um, if you have a small business under a hundred employees, um, your business assets are not counted on the FAFSA either, but they may be counted on that CSS profile form.

So.

Thank you. That was a really helpful answer. Oh. Um, and then part two of that question, which I know you might touch on more later, um, is how do college savings plans including 5 29 plans [00:46:00] affect student aid?

Yeah, so that’s great and that’s easy after the answer I just gave. So college, um, savings plans, including 5 29 plan that we’ll talk about are, are categorized as a parent asset.

So they are treated as a parent asset and counted at that 5.6%, so small amount. Um, and I will also add that, uh, currently when parents are putting 5 29 plans, um, listing those on the financial aid forms, you’re only listing the 5 29 plan for the student who’s FAFSA you’re completing, not of the siblings.

So that’s helpful with those plans as well. Great. Thank you. Thank you. And so then this is sort of the financial aid formula that’s gonna determine how much aid you might receive. The cost of attendance minus your student aid index number as determined by those [00:47:00] financial aid forms equals your financial aid eligibility.

And what that means is then colleges try to award the student financial aid up to the, that financial aid eligibility. And there are some colleges that promise to meet the full need of all of the students. So in that case, they would give you a financial aid award to equal that financial aid eligibility if they are one of those colleges that meet full need.

Uh, many, many colleges. Can’t meet full need of all students. So they do their best to give an award that’s as close as they can get to that financial aid eligibility. And that’s why that student aid index is a good indicator of what you might pay, but it may not be exact to the penny, um, because not all colleges will completely fill in that aid eligibility.

So in general, [00:48:00] you know, you’ll re, your student will receive, uh, awards from financial aid awards from all of the colleges where they’re accepted. And then it’s a really critical time when that happens to be able to take those offers and. Break them down. So you compare apples to apples and we have a calculator on our website that will help you do that.

Um, but really break down the costs of the colleges that your student is hoping to go to. Break down the financial aid and see what that bottom line is so that that’s when you can figure out, oh, this is what we will have to pay as a family to go to this college. It’s for the student to go to this college and this college and this college.

And it can be very different from college to college. So that’s why that analysis is critical at that time. But then when you get to that and figure out the differences and um, you know, maybe you go back to [00:49:00] one college and you ask for a little more money, um, or maybe you. You know, your student goes to the open house and learns more about that college that gave more money and decides, oh, I really will enjoy it there.

I’m gonna go there. So those kinds of things are happening. But the bottom line is once there is a bottom line of this is what we need to pay each year as a family, how? How do families pay? And here all the ways that they pay. So financial aid, hopefully receive a good amount of that. Then you can look toward any past income.

So do you have savings? Or other assets that you can draw upon your present income. Um, all colleges have, um, something called a monthly payment plan, and that allows you to break up the cost of college over the course of 9, 10, 11, 12 months versus just paying once for the fall, once for the spring. So maybe you have a little bit of money in your budget, um, you know, monthly and you [00:50:00] wanna set up that you’ll make some payments to the college on a monthly payment plan or future income, and that would be parent loans, student loans.

Many times it’s a combination and that’s over and above. We’ve talked about the federal student loans that are in the financial aid offer, so this would be. More loans on top of that. And um, usually it’s either the parent that would need to take a loan or the student could take the loan but will need a parent co-signer for this type of loan because it’s not one of those special federal student loans.

And with that it’s, you know, doing your research as you would anytime you need to borrow a loan and finding the loans with the best terms and the best repayment plan, all of that, so. We’re kind of switching gear gears here a little bit. Um, but I will, I will go back to say [00:51:00] that so that, you know, MIFA has lots of information on this and, uh, we have webinars to help you compare financial aid offers and think about all of your options on how to pay.

So know that that’s, um, another resource that you’ll have when you get to that stage. But now we’re sort of backing up a little, because one other thing I’ll say about this slide is the more savings you have when you get to this stage, the less pressure you put on your current income, your salary, your monthly budget, and the need to borrow additional loans.

So saving for college to the extent that you’re able to is just a really great thing to do. It’s, it’s just good to have some money available. To put to it. So if you have done that, that’s great. You, you won’t be sorry. And, uh, if you haven’t, it’s never too late to start. So this is [00:52:00] just an example, kind of a simple example, but just to show you if there’s a $10,000 college cost.

Well, if you’ve saved, um, over time, you might have saved 6,960, earned interest of 3000, and that’s how you’re gonna get to your $10,000 college cost. Or if you have to borrow 10,000 and then pay interest over time, you end up, you know, borrowing 13,920. So the thing is, you’re probably going to pay for college over time anyway, so it can be helpful if you save early on and earn the interest rather than need to borrow and pay the interest.

But I’ll just share. There’s no shame. I have worked over many years with tens of thousands of families and, um, you know, there are circumstances and people do all, all of these things. Um, so I’m so glad. The question was [00:53:00] asked about, you know, how are assets treated and how are five 20 nines treated in this process?

Because there has been a persistent myth out there. Maybe we’re finally breaking it even the way that question was asked, but there was, uh, a myth for a long time that I’m not gonna save for college. My savings will just hurt how much financial aid I receive. And the truth is what I’ve already explained, that income is the biggest factor in that financial aid formula and savings is treated in a smaller way.

And that your savings really will be a help when it comes to that time of paying for college. And then another, I guess I’d call it a myth. Something I’ve heard a lot over the years is, you know, someone will do some research into some of these colleges, look at the price and say, I can’t save enough to even close to get to that.

And plus I have three children. There’s no way I could save [00:54:00] the entire cost. I’m not going to bother. And that has been a common reaction that I’ve, I’ve seen over the years. Um, but the truth is you don’t have to save it all. I don’t know many people who have saved it all for all their children. Um, and I know a lot of people who have.

Pieced it all together for all of their children over the years. And, um, so the truth is that every little bit that you do save can be a help. And even small amounts can make those differences and add up to cover books or to cover one year, uh, to get, get you started before you have to really think about, you know, um, diving into, um, paying from your current income, borrowing another loan, all of that.

So whatever you can save will be a help and. The, again, these savings will, it could be the difference between your student being able to go to [00:55:00] their first choice or second choice college if you have some, some savings. It could allow a student to really take advantage of, uh, study abroad or unpaid internships on campus.

Um, it could reduce or eliminate the need for you to borrow a loan and it could allow a student to work less during college. And, and hopefully that means study more. Um, and now we know that has a minimum impact on your aid eligibility. So it’s just a, it’s just a good thing, um, to save. And this last one, um, MIFA really spent a lot of time, um, learning about this research early on, and that is that there have been studies done, um, and the big studies were, um, out of the University of Michigan and, um.

Talking about how if a student knows that the parent has a college savings account for them, [00:56:00] and they don’t even have to know how much money is in the college savings account, just knowing that their parent is saving for them can be very motivating for a child. And it actually, there have been outcomes where the students did better academically in school and graduated, um, at a higher rate just by knowing that the parent was saving for them.

And so I, it came to me, I, it was out of the University of Michigan and, and the, um, professor who has done a lot of work on this is William Elliot. And, uh, he has done numerous studies on this. And so, okay. What are strategies for saving? What’s sort of the best practice? What do we recommend at, at mifa? Um, honestly, to start saving as soon as possible.

And here again here in Massachusetts, I feel like Massachusetts has some really great programs. Um, there’s something called baby steps. And so if, um, a [00:57:00] family opens a 5 29 account, the you fund is the Massachusetts 5 29 account, um, before the child’s first birthday in Massachusetts, then um, you get $50 put into that account from the state.

And, um. That, that’s it. So that then you get started on, you have a youth fund open for your child. Um, actually there’s a new program coming that’s gonna expand that beyond the first year. Uh, but it’s so new that, I’m not gonna say more than that now, but just to know that there are ways that you can open a college savings account early on and have, have some money put in it through, um, through these programs.

And, um, you know, there are times maybe when you can. Have automatic deduction, which makes it so easy, where you’re not thinking every month, do I have any money left over in my budget to put toward my [00:58:00] savings account? Could I just set it up so I have $50 going in there every month? That really is the easiest way and we see good results with people saving.

Um, another a time that sometimes, uh, we see parents step it up is maybe if they’re paying for daycare when the child is young and maybe daycare ends, the child enters kindergarten or first grade, and then they can save a little more. Um, and best of all. Is to have other people help you with this. So, um, there’s a gifting page, um, where you have your, you fund where you can put a little profile up about your child and have a link, and you can share that link with grandparents, with aunts and uncles.

So when it’s, you have that child’s first birthday party or third birthday party, you can say, you know, a, a tiny gift is great for Kevin as in this example. But what would be [00:59:00] really great is maybe just a little contribution to his 5 29 plan. And I think grandparents and aunts and uncles and friends love to have an idea of what to bring.

You know, those of us with children know there are always too many plastic toys around. Um, additionally, uh, now we have taken this to the next level. I don’t know that I talk about it in here, so I’m gonna just talk about it now. That, uh, there’s something where when you go to CVS Cumberland Farms and you, you see all of the gift cards on the, um, you know, at the front.

There’s now one called Gift of College. You fund Gift of College and you can buy a gift of college card and give that to the, um, to someone. And they can take that. They just have to, you know, register it at Gift of College and choose to put that into their. 5 29 plan. [01:00:00] So, and you can also pay off loans with that gift of college card if you have loans.

That’s another way you can use that. So that’s really a great way to, um, give someone a gift or, or if you have a savings account, ask for that as a gift.

And so let’s quickly talk about the Massachusetts two savings options. We’ll talk about the you fund first, because I’ve already started. That is the Massachusetts 5 29 plan. And you open that account and then you can save monthly or once in a while and save for higher education expenses like tuition fees, room and board books, supplies, equipment.

It’s now expanded to some K through 12 expenses, $10,000 toward loans. Um, other, you know, it’s not just for. Four year colleges, vocational [01:01:00] technical schools are included in that. Lots of K 12 expenses are now included in that. Um, and if you, you save and your money grows tax free, and when you take the money out, as long as you use it for one of these qualified higher education expenses, you never pay taxes on any of the earnings that you earn on that account.

So that allows your account to grow much faster if you’re not paying taxes and when you take it out, not paying taxes on any of the earnings. Um, what else can I tell you about that? Uh, when you sign up, you choose, um, a, um. How you want to invest your money and Fidelity can help you with that. Um, so go to fidelity.com/you fund to open a 5 29 plan.

And the other plan we have here in Massachusetts is the YOU plan. And that is a prepaid tuition program. So what that [01:02:00] does is it allows you to pay up to a hundred percent of tuition and mandatory fees. So when we talk about you fund, it’s all higher education expenses. When we talk about you plan, it’s just tuition and fees at participating schools, but there’s a large network of all of these colleges participate.

So they are public and private, all here in Massachusetts. And for example, the way this would work, let’s say that your child was five and today. I’m making these numbers up, but let’s say today UMass Amherst tuition and fees was $20,000. And let’s say someone gave you a gift of $10,000 and you decided, alright, I’m gonna put that into the U plan.

Well, that would mean that you locked in 50% of UMass Amherst tuition and [01:03:00] fees when your child was five. You locked in that 50% so that by the time your child goes to college, let’s say, um, UMass Amherst at that point costs $30,000. Well, your 10 has become 15 because that’s 50% of 30. So it’s all about locking in those percentages early on and um, can be a really great option for families who think that there’s a likelihood that.

Your student may attend any of these colleges. So umm much more about this on our website. Um, if your student doesn’t attend one of those colleges, which this is a big question, that’s okay. You can cash out your money when it’s college time and you can then, um, get your money back with, um, you know, uh, cost of living interest [01:04:00] and then you can use that to pay for whatever college they go to.

Um, my children went, one went to college in New Hampshire and one went to college in Pennsylvania. So I was not able to lock in the percentage to one of these Massachusetts schools and, and, and really have it do all of that. But I was able to take my money back with CPI interest and then use it to pay their tuition bills.

So it still worked out well for me. Alright, so there’s also a state tax benefit. Oh, I’ll stop Angie, if you have a question before I talk about this. Yeah.

Great. Um, we did get one question. Um, someone wants to know if the FAFSA still asks if you have a 5 29 plan or any other college savings. Uh, this person remembers being asked about this back when they completed the FAFSA in 2008, 2009.

And at that time it [01:05:00] did count against how much aid you received.

Yes. So it does ask, I think it would just be in the investments section, but then in parentheses, I’m pretty sure one of the, one of the. Examples is 5 29 plans, and it, it is counted, so don’t get me wrong, it is counted toward how much aid you receive, but it’s counted at that rate of 5.6%.

So it’s counted in such a small way that it tends to not have a large effect on the amount of aid you receive. But I say it tends to not, again, if you have $10,000, it, it, it’s counted at five 60. If you have a hundred thousand dollars, it’s counted at 5,600, which, yes, it definitely means that, that you’re expected to pay a little bit more.

But, [01:06:00] um, a again, that’s a small amount compared to the way your income is treated. So, yeah. And so they’re also saving for college, uh, state tax benefits here in Massachusetts. So if you’re eligible, your contributions to the U plan and you fund, um, can be state tax deductible and you can get a state tax deduction under up to 2000 in payments for married filers and up to 1000 in payments for individual filers when you file your state tax return.

And that is a limit per tax filer.

And so now I guess I can just share this sort of calendar of all of these activities that really ramp up junior and senior year. So spring, summer of junior [01:07:00] year, you’re researching those colleges, visiting campuses, maybe attending some college fairs. Asking teachers for letters of recommendation. I know we haven’t mentioned that yet, but that’s part of the admissions process.

Uh, taking the SAT or a CT if any of the colleges require that, that you’re applying to, you might wanna start your college essay, uh, fall of senior year. Some students retake that. SAT and a CT if they need to. Uh, you secure those letters of recommendation, maybe attend me a’s Financial Aid 1 0 1 webinar at that point, um, because you know their updates each year.

Um, you’ll complete all your admissions applications. You’ll submit the FAFSA and the CSS profile if necessary, and then that will continue into the winter where you’ll continue to submit admissions applications, maybe apply for those private [01:08:00] scholarships that maybe you’ve researched in Advance Vance Send in any mid-year grade reports.

And then spring of senior year, you’ll begin to start receiving those, um, acceptance letters and financial aid offers. And that’s that critical time where you really do want to compare those offers and, um, be able to decide how you’re gonna move forward with making a college choice. Um, students can also attend open house programs on campus to really get a better sense of the different schools and where they might like to go.

And usually students are accepting and choosing a college by May 1st, which has typically been National Decision Day.

And so here are some QR codes. You can go on the MIFA website or you can, if you see these QR codes now and want us, you can watch some other live and recorded webinars on different topics. Um, you can sign up for [01:09:00] Mifa emails and you can also learn more about saving for college. And these are all of our social media links, and you can always call us or email us with your questions on this whole process and we’re happy to, to help wherever we can.

So I think I’ll stop sharing and see if there are other questions that come up.

Awesome. Thank you so much, Julie. That was so helpful. We do have a couple more questions in the q and a. Great. So we had one person ask, how should you plan savings be reported on the FAFSA or CSS profile? Does it count as a parental asset?

Great question. Yes. It’s considered just like the 5 29 plan. So you would, uh, put it in as a parent asset and also then it’s counted at that rate of maximum [01:10:00] 5.6% of the total.

Great. And then another question was, um, in one of the slides someone saw combined 5 29 account limit as 500,000. Is it contribution limit or total limit including contribution and interest?

Yes. So it is, yes. So that means that, say a student can have multiple, maybe a grandparent has a 5 29 and the parents have a 5 29, but the total amount cannot exceed 500,000. And that is, um, it is contribution limit. However, I believe that with interest, once your account hits 500. I don’t believe you can make contributions.

I can, I can get, um, clarification on that, but I believe once the account hits 500, um, no [01:11:00] contributions can happen. Now if the stock market fell and, and hopefully that wouldn’t happen, um, and, you know, went down under 500 more contributions could be made and then the stock market went up and it was way over 500.

That’s fine. It’s just, I believe once it hits 500, you can’t make more contributions.

Gotcha. Great. Um, and let’s say we got another question. Would this limit be per kid or accounts for all my kids?

That is, um, per, per beneficiary, yes. Per kid, yes. Yeah.

And then there was a question earlier about a particular page on your website, so I’m not sure if you’ll be able to answer this now.

Um, but on the college cost projector from Mifa, does that cost include lodging, books, et cetera? Or is it just the [01:12:00] tuition fee?

Oh, I’ll have to go and look, re-look at that tomorrow. I know sometimes I don’t keep up. And I will be honest with you, we have a great web team and they’re always moving things and, and so I’m not confident in what I would give you as an answer, but I, I’m gonna assume that it’s the full cost because that’s how we generally, when we talk about college costs, that’s how we generally talk about it.

But, um, you could maybe even, uh, e just email us or call us tomorrow to check on that and I will make sure I look at it and, um. No know the answer to that in general, but we, we generally talk about college costs as the full cost.

Great. And while you were speaking, I took a look at the page and it did say near the top, um, it listed a few different items, so it listed tuition fees, food and housing.

So I believe that all those things are included, but I wanted to double check with the experts,

so [01:13:00] Yes. No, well then I think, I think, I think that is the answer Angie gave it to you. Perfect, perfect. Yeah.

Great. And if anyone else has any questions, we definitely have a few more minutes, so feel free to pop them in the q and a and we will hold on a couple minutes longer to see if any more questions come in.

That’s great. Yeah, these have been terrific questions and I love it because then I, I know others have the same ones.

No, we just got someone saying thank you so much for the knowledge sharing, answering questions. It’s been very helpful. So glad to hear that.

It is funny because we’ve done this for several years in a row now, but I still feel like I learned something new every single time, so

that’s good. Oh, much And I wish that I, these,

oh, yeah,

right.

I wish that I had this knowledge [01:14:00] back when I was applying for college, so that’s a really useful tool for everybody.

Oh, thank you.

All right, well that seems to be all for tonight. So I guess we can go ahead and wrap up if you’re comfortable with that.

That’s great. That’s great. Thank you, Angie.

All right. Thank you so much everyone for joining us tonight. And just a reminder, in a few days you will be receiving the recording, so if you missed the beginning or wanna double check on something that you heard earlier, you will be able to watch that back.

So, and thank you so much Julie. We appreciate having you and all of your wisdom and expertise.

Oh, you’re so welcome. Nice to be here and thank you all. Have a good night. Mm-hmm.

Have a great

night. Bye. Bye.