Is college worth it? According to a recent Wall Street Journal articleover one-third of parents with children ages 13 to 17 haven’t discussed their child’s role in paying for college. That’s alarming, considering how big of an investment college is for most families. Many parents just focus on the “where” and neglect to consider the overall return on investment. In fact, it’s very similar to shopping for clothes; some people are so focused on wearing a designer label that they neglect to realize that they can get the same quality from a store brand for less.

Determine Your Return on Investment (ROI)

To get the best return on a college education, do a little research. We suggest using a free college search tool, such as Cappex or Big Future to narrow down the list of potential schools and to compare prices. So many families wait until senior year to start this process and only look at those “designer label” schools. Your child’s college decision should include so much more than just a school’s ranking or name. You need to consider choice of major, student fit, the average student aid package offered, and overall affordability.

Keep in mind that due to the continued demand to attend prestigious, top-ranked schools, you’re less likely to receive substantial merit-based financial aid (scholarships and grants) from these institutions. That means your child, as well as you, may be taking out larger student loans. Instead, consider smaller, private colleges, or in-state public colleges, where you are more likely to receive a healthy financial aid package to help cover the majority of your college expenses.

Don’t Forget FAFSA!

Every family should complete the Free Application For Federal Student Aid (FAFSA).  Many parents believe that they make too much money for FAFSA and won’t receive any aid, so why fill it out?  The FAFSA doesn’t actually give money. Colleges use the information on the FAFSA to determine how much money to award in addition to merit aid. If you fail to complete the FAFSA, you won’t be eligible for any federal or institutional aid.

Complete the FAFSA and other financial aid forms the colleges require, like the CSS Profile, as soon as possible. Colleges have different financial aid deadlines, so make sure you plan ahead. It’s not unusual for financial aid to be awarded on a first-come, first-served basis. Submit your forms early to ensure you get the most financial aid.

Consider the Big Picture When Choosing a College

One thing most people forget to take into consideration when factoring the overall cost of college is the four-year graduation rate. If the majority of students are taking five years or longer to graduate, that can mean an additional $20,000 or more tacked onto your overall cost of attendance (COA). In most cases, merit-based financial aid is only good for the first four years. This means you’ll be responsible for covering all costs for any additional terms.

Determine your college budget for all four years before deciding on a college. All too often, families concentrate on paying for the first year of college without a plan for the subsequent years. This not only puts your child’s college education in jeopardy if you can’t secure adequate funding but can also lead to overwhelming student loan debt.

What About Full-Ride Scholarships?

Don’t assume that high grades, talent, or athletic ability will result in a full-ride scholarship to your dream school. In fact, only 0.2 percent of students get $25,000 or more in scholarships per year.

For state awards, like Florida’s Bright Futures, make sure you do everything possible to meet the requirements to receive the aid.  If needed, pay for an ACT/SAT prep program to increase your scores, find volunteer opportunities, and do your best to attain good grades in school, as this will increase your chances of winning scholarship money. Also, consider the military option. There are great ROTC programs on most campuses and they offer scholarships up to a full ride.

The most important thing to know about scholarships is to start applying early. Many private scholarship programs are open to students 13 or older. Don’t wait until spring of senior year to start the process. If you do, you may be scrambling to find alternate funding for your child’s education.

Remember, It’s OK to Say No

Finally, remember that it’s okay to say “no” to your child. If his/her dream college is too expensive, and you cannot realistically afford to cover the cost of attendance, don’t go into debt. Sit your child down and have a candid discussion about the full cost of attendance, including the amount of student loans that will need to be taken out, and how long it will take to repay that debt. Look at the expected salary your student may make after graduating and compare the costs of several colleges. This will help make an informed decision based on the return on investment and not just the college’s name. We guarantee your future graduate will be thanking you later.