College Saving Catch-Up Stategies

Sometimes, no matter how well you plan, you may need a backup plan to pay for college. Think about these options:

Consider a community college for the first half of a child’s college education. The child can later transfer to a public or private four-year institution. One community college in New Jersey encourages this with the marketing slogan “Start here, go anywhere.”
By starting out with community colleges, students have the dual advantages of receiving a bachelor’s degree from a four-year college and thousands of dollars of savings on tuition, fees, and room and board expenses. Check with both schools in advance about guaranteed admission agreements, course prerequisites, and requirements to transfer credits.
Consider a cash-out mortgage refinance or home equity line of credit to obtain money for college expenses. These loans should only be used if parents have a low debt-to-income ratio and the interest rate is attractive.
Paid employment is another option: the student can get a part-time job or a parent might return to the labor force.
Another option is to plan to retire a large household expense, such as a mortgage, by freshman year and use the freed up cash to pay college expenses out of current income.