Page 57 - Book2E

Your Total Cost ÷ 180 months
3 . Now assume you borrow the amount needed for your child’s education and repay it over 15 years. Loan calculators are available at www.bankrate.com. Enter the total amount you have determined for a loan of 15 years to see how much would have to be paid each month. Example: A $34,800 loan at 8% interest for 15 years = $332.57 per month. The total repayment amount: $59,862.60. So you will pay over $25,062 in interest.
Your actual cost
4 . Now determine how much you would save if you deposited the $193.33 per month to save for college for 15 years, using the Simple Savings Calculator at www.bankrate.com. Example:$193.33deposited per month for 15 years at 4% interest = $47,928.59.
Your actual savings
5 . What is the real cost of using Financial Aid to pay for an education? Using the example above, by saving the $193.33 per month for 15 years, you would pay for college and still have $13,128.59 in the bank. More than enough for a great graduation gift!
If you chose the loan instead, you would pay back the $34,800 PLUS $25,062.60 that could have been yours. Something to think about.
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There's More to an Education
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