What A Great Way To Plan For College

Category: Finance, Real Estate.

With the average cost of college level education rising approximately 6% every year, what is the best way to have the money for college exepnses when you need it? In fact, only 40% of students graduate in four( 4) years.

We can easily help you with different ways to invest for college education. That means that 60% of students are taking five( 5) years to complete their education. On average, it costs over$ 6, 000 per year to attend a state college. It's very important to plan for this major expense well in advance. And if you attend an out- of- state college full time, there is a sur- charge of over$ 10, 00Private colleges can run well over$ 22, 000 per year. However, this can result in hefty tax payments. There are actually several ways to pay for your education or provide financing your child's education: You can invest your money in the stock market or savings account.

You can hope your child has the ability to obtain a full scholarship. But consider the longer time frame to graduate. and also the fact that there is a higher drop- out rate with students who have to work. You can take a second job when the time comes. or have the student take a part time job to help with expenses. Or you could have your child finance his/ her education with student loans. Let's consider a a couple of different ways to save up for those education expenses! But, this leaves them with a huge debt load when they are trying to start their new adult life. Let me explain how to have the money for college at your fingertips when you need it.

I' ll use a$ 125, 000 property for our example: Equity will build! Just purchase a rental property with a 15- year mortgage? Even if there is no appreciation in value, you will still have this$ 125, 000 property paid for in 15 years. But let's run some figures on a modest 5% increase per year in property values. Plenty for the finances needed for college. In this case, your property will more than double in 15 years. And you don' t even have to sell it!

Your$ 125, 000 investment could be worth over$ 250, 000 when you' re ready to pay for college. Here's a way to take your money out of this property without paying tax on it. A re- finance is not taxable income! ! Simply re- finance it. What a great way to plan for college! Even with refinancing for a higher amount- consider that because the property has increased in value- so has the potential rental income! You will have had renters to pay the mortgage payment. and if you re- finance for college expenses, you will still have renters to pay for the new mortgage payment.