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September means college for a lot of people, so today, Mellody Hobson addresses the financial issues around pursuing a higher education.

Where should people start?

Every financial issue should start with honest and open communication. For college, that means talking to your kids sooner rather than later about what you can afford and what you’re willing to contribute to their education—so you’ve managed expectations. Every parent wants to set their child up for success, and the best way to do that when it comes to managing finances is to model responsible behavior, teach your kids as much as you can about saving and investing and do your best to ensure they don’t take on a lot of debt for whatever reason—education among them.

How do people make the right choice for their child and their family?

First of all, it’s easy to envy the family who can just pay for their kids’ education outright, but studies show that those parents may not be doing their kids any favors. It turns out that students who foot part or all of their college bill focus less on socializing and more on academics, earning higher GPAs.

More time at the library and less time at the frat house?

Exactly. With grants or scholarships, students have earned them in some way and feel a sense of responsibility. Also, there’s a minimum GPA they have to meet, which keeps them involved in the ongoing funding of their education. It’s worth noting, Tom, that the higher GPAs are associated with grants and scholarships—NOT student loans. If checks come in without conditions, there’s still a disconnect that this is actual money—until of course, the time comes to pay back those loans.

And student loans are out of control, right?

We have over a trillion dollars in collective student loan debt. It’s a crisis, Tom. This should be your very last course of action when thinking about funding college. Go in this order:

College Talk  was originally published on blackamericaweb.com

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