During what we consider the dark ages of the 60's and 70's most families

did not really have a problem paying or financing a college education.

However, this trend changed in the late 80's and continues today. Today

most individuals approach college financing in the wrong way.

The major reason for this is because most families are planning on paying for

college the only way they know how and that is the old fashioned way.

A generation ago, most college students graduated with little or no debt. If

there was debt, the interest on the debt was totally tax deductible

regardless of the family's income.

Many parents and students feel the higher the cost of a college or

university, the better the education the student will receive. A study

conducted by the Bureau of Economic Research found "People who succeed in

life socially or financially do so because of who they are, not because of

what college they attended."

The study also found that receiving an undergraduate degree from a top

college or university provided no difference in career or economic success.

The report said a top student who attends an average college or university

will fare better in life than an average student who attends a high profile

college or university.

Below are some of the main reasons why families have problems of pay for

college.

â–º Waiting To The Last Minute

Most parents consolidate 4 to 18 years of college planning into 6 months or

less. Families spend more time in planning their vacation or buying a laptop

than they do in seriously figuring out how to pay for their children's

college education.

â–º Families Don't Understand How The Financial Aid System Works

Parents do not understand the terminology used in the financial aid arena. If

you think doing a tax return is tough, wait till you look at a FAFSA or CSS

Profile form. Families truly do not know what is available to them in

financial aid and even if they did know, most families don't know how to

apply for the aid.

â–º Families That Earn A High Income Or Have High Asset values Do Not Apply

For Financial Aid

By not applying for financial aid, families are throwing away almost $23,000

of Federal Financial Assistance over a five-year period. This money is

available to the student regards of the family's income or assets. And you

may be leaving thousands of dollars of merit money on the table as well.

â–º Parent Don't Understand How Their Income Tax Returns Affect Their

Family's Financial Aid Eligibility

The financial aid formulas are run based on parents' and student's income

tax returns. Income is the largest factor when it comes to qualifying for

financial aid, NOT ASSETS. Most middle and high income taxpayers will NOT

qualify for NEED-BASED financial aid at most state supported colleges and

universities.

Therefore, proper tax planning is a MUST. How you complete your income tax

returns could create what we call TAX SCHOLARSHIPS, which could be more

valuable than financial aid.

Decide now to either invest the time to learn all these critical areas or

find someone who can walk you through each one. Whether you gain long term

financial success may be dependent on how you use this information.