Today’s Practical Planning Tip we will continue our discussion onMoney Advice Every Parent Should Give Their Children.
View college as an investment: Student debt may be the single biggest financial mistake people make. Many high school seniors choose a university based on national rankings, campus life or junior year study abroad options. In reality, college should be viewed as an investment towards a successful financial future. If a student needs to take out debt to finance their education, it’s essential that they have a well-defined plan on how they plan to repay it. If there is no repayment strategy in place, it can have a domino effect that will impact the rest of their life. Cash flows will be tighter, the ability to save will be impeded, and lifestyle goals like buying a home and having kids may need to be postponed. Failing to view your child’s college education as an investment can have the unintended consequences of saddling them with an insurmountable level of debt that will derail their financial future.
And if you’re still of the mindset that you should go to the “best ranked” school you get into, you are living in the dark ages. Save your money and go to a university that can earn you the best return on your investment or don’t go at all and start a business! Those are far better options than financially struggling the rest of your life with an expensive degree that has no value.