I remember thinking I must have got on the wrong bus as the drill instructor yelled at me. It was exactly 15 years ago when I graduated high school and joined the U.S. Marine Corps. It seemed like a logical answer when Pete and I stopped by the recruiter’s office and learned about how to pay for college. I was to spend my summer before college at Parris Island, S.C. I mean come on, it almost sounds like a tropical destination, right?  Although, it was exactly what I needed at 18 and was a life- changing experience, it is not the only option when figuring out how to pay for college.

The Montgomery GI Bill is one of the programs offered by the government for civilians who enlist. This program provides a lot of support for anyone looking to go to college or to get an apprenticeship. I took advantage of this program when I went to Owens and UT. According to the U.S. Department of Veterans Affairs’ Web site, full- time college students can receive up to $329 a month for 2009.  Remember this Memorial Day to say thanks to the many men and woman who have honorably served our great country and ask a veteran about his or her experiences in the military.

College Advantage is Ohio’s 529 Savings Plan and it is another great option for saving for college. This investment account offers several investment choices from fixed to aggressive. I put money into the age-based investment option for our children.  This account starts out more aggressively and gets more conservative as my children get closer to college age. Each month, I put money into each child’s account and systematically save for them, although a lump sum deposit is also an option. The program can provide tax benefits for both the person putting the money into the account and for the student who uses the money for higher education.  Anyone from parents to grandparents can open an account. A 529 plan can be started for as little as $25.

Tuition Rewards is a new and little-known option that can build guaranteed scholarships for students who go to participating private colleges and universities. More than 225 colleges and universities participate in Tuition Rewards across the United States, including 18 in Ohio. This program builds an account similar to frequent flier miles. Yet instead of flying to earn points, Tuition Rewards are earned by saving and investing. Points are earned by saving with a wide variety of partners of Sage’s Tuition Rewards.  Each point is equal to $1 in scholarship money. This program can cover up to an entire year’s worth of higher education or 25 percent of the total cost.

The reason that Tuition Rewards is so unique is the money saved in the account doesn’t have to be used to pay for college. For example, if I had $10,000 saved for my retirement in one of Tuition Rewards approved partners, my son would earn $1,000 a year in scholarship money.  The retirement account is still for me, yet after 15 years, my son would accumulate $15,000 in scholarship money.  Once he is ready for college, the total scholarship money would be divided equally over four years.   Any account owner can sign up children, grandchildren, nieces, nephews and other family members for this program.

A nice feature of Tuition Rewards is that this money is scholarship money and, therefore, investment decisions do not need to be made. Yet, a drawback of Tuition Rewards is it like frequent flier miles and an account owner needs to know and follow the rules and regulations to ensure eligibility of benefits.

Congratulations to the 2009 graduates. I hope this generation will lead our nation into a better tomorrow. Here is a homework assignment. Research all of the financial aid, grants and scholarships and then create a written plan of action on what programs you and your family should take advantage of, and be sure to find out if you are working with one of the partners of Tuition Rewards.  If so, sign up to start earning scholarship money.

For more information about The Retirement Guys, tune in every Saturday at noon on 1230 WCWA and every Sunday at 11 a.m. on 1370 WSPD or visit www.retirementguysradio.com.  Securities are offered through NEXT Financial Group Inc., Member FINRA / SIPC.  The Retirement Guys are not an affiliate of NEXT Financial Group.  The office is at 1700 Woodlands Drive, Suite 100, Maumee, OH 43537.

This entry was posted on Thursday, May 7th, 2009 at 8:21 pm and is filed under Retirement Guys, Toledo Business Link.
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