My daughter is going to law school. What are our loan options?
Q. My daughter will be studying law. I would like to know my financing options without paying out of pocket. What are the best loan options? We live in New Jersey with a combined gross income of $ 130,000. My daughter has no income.
A. Law school can mean big bills, so we understand why education funding is important to you.
Start by completing the Free Federal Student Aid Application, also known as the FAFSA.
The options are similar to those who apply during their undergraduate studies, said Dean Shah, a certified financial planner at Stonegate Wealth Management in Oakland.
He said your daughter should apply for any scholarships and grants she might be eligible for. Grants and scholarships are free money and will not need to be repaid after graduation.
Depending on the school, there may be a work-study program.
“This usually means that the student will have to work part-time during class and full-time in the summer, perhaps also during breaks,” Shah said. “In exchange for a job, the student will receive a paycheck or a discount on the credits to be spent on the courses. “
Then the loans.
Shah said your daughter can get started and federal loans are better than private loans because they have lower interest rates and more flexibility in repayment, he said.
Then you can consider Parent PLUS Loans, that would be taken on your behalf.
“These come with higher interest rates and are not subsidized, which means that interest starts accruing as soon as payment is made and continues even if loans are deferred,” he said. declared.
“Due to the negative effects on retirement savings, Parent PLUS loans are generally not recommended, but if the goal is to reduce your daughter’s financial burden, they are an option,” he said. .
Your daughter can also watch Grad PLUS Loans, which are similar to Parent PLUS but are on behalf of the student, not the parent, he said. Unless you are planning to co-sign, your daughter must have a decent credit history to be eligible.
If you have equity in your home, you can always consider a Home equity line of credit.
Shah said there was another option to consider. Some law firms will pay for their employees’ legal education in exchange for a promise to stay with the company for a period of time. She could look for a job with a company that would help pay these bills.
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Karin Price Mueller writes on Bamboo column for NJ Advance Media and is the founder of NJMoneyHelp.com. Follow NJMoneyHelp on Twitter @NJMoneyHelp. Find NJMoneyHelp on Facebook. Sign up for NJMoneyHelp.com‘s weekly electronic newsletter.