Most parents rely on loans and scholarships in order to manage their child’s education expenses. In reality, there are other options, but few people are aware of them. Therefore, this article can help to highlight some of the options that can be beneficial for you. It can be useful if you’re looking for options to pay off college debt without complicating your financial situation.
Here are some of the effective tips to pay off your college debt without relying on student loan or financial aid:
- Stocks- Beneficial for your college savings portfolio: Tuition costs are incessantly increasing, faster than inflation. Therefore, stocks are considered to be the best way to save enough for the long term. You can start saving today to secure the educational future of your child. Therefore, parents can save money for a child who is approaching college age. You can effortlessly shelter your returns by switching your money into more bonds and cash. Once the bonds are matured, you can pay for college expenses with ease.
- Section 529 Plans: Can be an effective solution to your problem:
Section 529 plans are popularly known as the Qualified Tuition Programs (QTP). This plan is considered to be the best option for saving for your children’s college education. You can effortlessly use your savings to pay off your educational loans without relying on additional loans or other financial aid programs. Prepaid tuition plans and college savings plans are two types of programs under section 529 plans. When you opt into prepaid tuition plans, you lock in future tuition rates at in-state public colleges at current prices. Its usually guaranteed by the state. However, college savings plans are not rigid and do not offer a guarantee.
- Savings Social Networking Programs: Social networking sites encourage friends as well as family to contribute to a child’s college education. Some programs are designed for the donor like updates on the child’s academic progress. Therefore, the contribution of the donor can be used to encourage the student to get good grades and succeed in school.
- College Savings Bank: The CollegeSure CD is an FDIC-insured certificate of deposit that is aimed for the purpose to manage college expenses. This certificate is offered by a college savings bank. The interest on this CollegeSure certificate of deposit is similar to other CDs. The interest percentage is fixed for average college costs at maturity. Once a CollegeSure CD has matured, the family can use the principal and accumulated interest to pay off college expenses.
- Education Bond Program: Interest on certain savings bonds is tax free with the help of the Education Bond Program. Therefore, when you redeem bonds to manage higher education expenses, these savings are tax free.
Keep the above mentioned options when you’re planning to manage higher education expenses and want to use more than just loan and scholarship programs.