Paying for College - Local Scholarships & Financing Tips

If you have a child heading off to college and feel unprepared, you're not alone. According to U.S. News & World Report, fewer than half of parents (44%) felt ready to pay their child's first tuition bill. Overall tuition & fees continue to grow, but there is a big gap between the on average $11,011 you'll pay at public colleges, versus the $43,505 per academic school year at a private college.

Fortunately, there are resources available to help. Let's start with a quick review of college financing basics to prepare you for what's ahead:

Savings & Scholarships - If you've been stashing away birthday money over the years or contributing to a 529 College Savings Plan, that's great. Those are the funds you'll want to use first, along with any scholarship awards your student receives. Not sure how to find scholarships? Visit popular national websites like Scholarships.com. And, don't forget to pursue local opportunities like the Roush Scholarship from Abound Credit Union, which is accepting applications until March 31, 2025. Ten graduating high school seniors right here in Kentucky will receive $2,500 (each) through this annual program. The Central Kentucky Community Foundation also facilitates scholarships for graduating seniors in the Central Kentucky region through Scholarship Central. In 2024, they facilitated more than $350,000 in awards!

Federal Student Aid – Be sure to complete the Free Application for Federal Student Aid (FAFSA) each year. Not only could your student qualify for grant funding or federal student loans through this application, but many schools also utilize it to help award need-based aid. The 2025-26 form is now available online at www.studentaid.gov. Don’t forget this important step in the financial aid process, even if you’re unsure whether your student will qualify for aid.

Supplemental Private Loans – Even with scholarship awards, family savings and federal student aid, there may still be a funding gap between your child’s tuition, fees, housing, books and other expenses – and what you’re able to pay. If this happens, there are private student loan options for both students and parents to consider. Be sure to shop around for the best rates and fees before committing and discuss with your child that any loans (federal or private) will need to be repaid. If you’re a homeowner, you may consider whether taking a Home Equity Line of Credit (HELOC)¹ or Home Equity loan could be a more affordable solution to meet college funding gaps.

Are Multiple School Options on the Table? If your child is still trying to decide between several schools after receiving their acceptance letters, take the financial aspects of each into consideration. For example, if attending an in-state, public college would result in zero or much less student loan debt, that decision could have a decades-long impact on your child’s future. Likewise, if a large, merit-based scholarship award makes attending a specific private school your least expensive option, this is vital to consider.

Here are a few questions to ask before making a final decision on where to enroll: Does my desired career really require a degree from a private university, or could I obtain the same job and salary at a lower-priced state school? Will a degree from a more prestigious school increase my starting salary post-graduation? Should I consider a technical school or trade school?

And, here are a few questions to ask before borrowing: If I take out student loans at current interest rates, what would my monthly payments be after I graduate? How many years would I spend repaying this debt? What is the average salary for graduates in my specific field of study? How much of my monthly budget, given this salary, would be spent repaying student loans? Would I have enough to cover my other monthly costs and pursue financial goals such as homeownership?

Taking time to consider the options now could make all the difference post-graduation and prevent unnecessary financial stress for many years to come. Here’s to Kentuckians making more informed financial decisions and achieving their educational goals!