Ep. 32 How to Deal with the High Cost of College
In today’s episode, we interview Brad Baldridge, and talk about money strategies to deal with the high cost of college. Mr. Baldridge is a late-stage college planning specialist and podcast host (Taming the High Cost of College). He helps parents of high school students plan and pay for college using strategies such as merit aid, need based aid, tax planning, savings and investing for college, negotiating with colleges, scholarships and loans.
He works with many parents/families with high incomes that may not qualify for need based aid. Here are some tips:
- Gift assets to your children to pay for college
- Utilize college savings plans for the tax benefits
- Shift more income into retirement plans for better tax planning
Mr. Baldridge talks about how to pay for the high cost of college utilizing tax scholarships. That means paying for college tax efficiently. For example, shift income to students if you own a business or rental property by hiring your student to do yard work or as a part-time employee. This would create an expenses that is deductible on your taxes. Another example would be to take advantage of the tax credit available to families with up to $2500 in education expenses per child. Contact the IRS.gov website for information about tax credits for education expenses.
The last question I ask deals with the current political climate in which both of the Democratic candidates talk about their plan about dealing with the high cost of college:
Links mentioned in this episode:
Website – Tamingthehighcostofcollege.com