Hispanic families foster strength, unity,and loyalty. In fact, 80 percent of HSFscholars name their families as a source ofemotional support during college. (Source:Hispanic Scholarship Fund.)

If your child is the first in your family toattend college, the college planning mayseem like a whole New World. The manyforms, rules, and deadlines may be frus-trating for you. We understand. Try notto feel overwhelmed by the paperwork,but stay focused on your child and his orher future. It is a bright future, indeed.

The Family Foundation: A Special Note to Parents

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The importance of collegeThe Hispanic population in the UnitedStates is growing, which means thatHispanics are becoming a major influenceon American culture, economics, andpolitical policies. Your child’s college education can help position him or her to affect all of these areas. A college education also can open vast careeropportunities for your child.

The cost of collegeA college education does require aninvestment of time, effort, and dollars.The cost of college (tuition and fees)increases, as do the costs of most things.Here is what college students currentlypay each year for tuition:

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Type of College Average Tuition per YearFour-year private institutions $17,123

Four-year public institutions $3,754

Two-year private institutions $7,953

Two-year public institutions $1,738

(Source: The College Board)

The college payoffCollege costs may seem scary, but thepayoffs are big. By spending money oneducation now, your child can earn moremoney. Some 88 percent of HSF scholarsearn more than the national per capitamedian income. In fact, 60 percent earn atleast two times more than the Hispanicmedian income in the United States.Consider the chart below:

The best way to help: emotional support and moneyCollege students typically need twoimportant elements from their families:emotional support and money. Both ele-ments are important. Pursuing a collegedegree—especially if your child is the firstin your family to do so—can be intimidat-ing. Knowing that you are in his or her“corner” can help your child overcomedoubts and fears.

Of course, money also helps. Saving moneyto help pay for your child’s education (orbooks, fees, or meals) can help make your

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Professional degree0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

$17,261$21,737

$35,744

$44,149$49,279

$64,406$68,804

$74,476

$97,325 $100,000

Less than 9th grade

9th to 12th grade

High school graduate

Some college, no degree

Associate’s degree

Bachelor’s degree

Bachelor’s degree or moreMaster’s

degree

Doctorate degree

Median Annual Household Income(by Educational Attainment of Householder, 1999)

child’s dreams a reality. Plus, your contri-butions make the goal of education evenmore of a family pursuit.

As some people might say, “It’s never tooearly.” This applies to saving for a child’scollege education. There are various collegesavings plans, such as the state-adminis-tered 529 plans and prepaid college tuitionplans that allow parents to save funds ona tax-deferred or tax-exempt basis.

Whether you start saving the day a babyis born or halfway through the child’sfreshman year at college, any amount ofsavings can put a student one step ahead.Remember, there are expenses beyondtuition that must be paid.

Ways to saveYou may say to yourself that finding moneyto save for your child’s college educationwill be tough. Although it may take somechanges, here are some ideas you can try:

• Pay yourself first. Think of saving foryour child’s college education as a “bill”you pay to yourself. Take some moneyfrom each paycheck ($10, $25, or $50)and put it into a special savings account.

• Save extra money. This extra moneymight include tax refunds, job bonuses,overtime pay, or raises. You may haveextra money after you pay off a bill. For example, say you pay off your car

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SHOULD YOU?Should you save in your child’s name?

Parents often wonder if accounts set up to save for college should be kept in the parents’ or child’sname. Keep these points in mind when making your decision:

• Recent tax-law changes have reduced the tax advantage of saving in the child’s name (called a custodial account).

• You give up control of the money if you save in the child’s name. When the child reaches “the age of majority,” he or she could decide to spend the money on a car instead of college.

• More money in a child’s name could mean the child will qualify for less financial aid. When calculatingthe amount of financial aid a student may qualify for, schools expect students to contribute a largerpercentage of their income and assets than parents. That is why some financial planners recommendthat college savings be kept in the parents’ name rather than in the child’s name.

loan. You can take the money that wentto your car payment and put it in thecollege fund instead.

• Suggest gift ideas to relatives. Many relatives never know what kind of birthday or holiday gift to give. Helpthem out and suggest a contribution toyour child’s college savings fund.

• Spend less. Find ways to cut back onspending and put what you save intothe college fund.

Other college planning tipsHere are some additional tips from theHispanic Scholarship Fund on preparingfor college on a shoestring budget.

Talk to a guidance counselor

When planning for your child’s collegeyears, don’t do it alone. Ask for advicefrom an expert, such as a concerned highschool counselor who is knowledgeableand can provide reassurance and guidanceso that the right steps are taken.

Apply for financial aid

Before applying for financial aid, students must meet the following basiceligibility requirements:

• financial need (you and your child willneed to disclose information about yourincome and savings)

• high school diploma or GED certificate

• valid Social Security number

• enrollment in an eligible degree program

• U.S. citizen or an eligible noncitizen

• a record of satisfactory academicprogress once in school

Help your child assemble the importantrecords and papers and then submit a Free Application for Federal Student Aid (FAFSA). (See page 26 for more information on the FAFSA.)

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Look into Advanced Placement courses

Encourage your child to take advancedplacement (AP) courses in high school,when available. The extra work andstudying will pay off if the student passesAP exams with a grade of 3.0 or higher.Students with high grades on AP exams inmultiple subjects may be granted a fullyear of course credit in college. This savesboth time and tuition.

Review your child’s options

A four-year college is not the only way togo. Sometimes students enjoy easing into thecollege experience by enrolling in a two-yearcollege program. Local community collegesusually are the least expensive and often arelocated in an area where the student alreadylives. The student should check on whatcourses will count toward a bachelor’sdegree at the four-year college of choice.

Research other resources

Help your child reduce college debt asmuch as possible by considering grantsand scholarships from organizations tosubsidize an education. Don’t forget toexplore what your own employer offers.Some businesses or unions offer scholar-ships or grants to children of employeesor members. Grants are awarded on thebasis of financial need, and scholarshipsare awarded based on criteria, such as

academic performance, leadership skills,athletic ability, and so on. Grants andscholarships do not need to be paid back.

Reapply for financial aidFinancial aid paperwork is only good forone year, so parents and students mustcomplete a new FAFSA each year torequalify for financial aid. Missing thedeadline will put a serious damper on college plans and budgets.

Prepare to pay back student loansIf your child receives financial aid in theform of student loans, he or she needs tobe ready to pay the money back withinterest after graduation. Before acceptinga loan, parents should discuss with theirchild the cost of student loans.

A final thoughtThe Hispanic Scholarship Fund and the National Endowment for FinancialEducation know that you want what’sbest for your child. You want your childto dream bigger and go farther than youever imagined. We hope you will use theinformation in this manual to help make a college education a possibility for yourchild because the advancement of any one of us is the advancement of all of us.

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The Money Manual: A Personal Financial

Guide from the Hispanic Scholarship

Fund was written and produced for theHispanic Scholarship Fund as a publicservice by the Denver-based NationalEndowment for Financial Education®

(NEFE); William L. Anthes, Ph.D.,President and CEO; Brent A. Neiser, CFP,Director of Collaborative Programs; andJeannette Herreria, Project Manager.

NEFE is a nonprofit foundation committedto educating Americans about personalfinance and empowering them to makepositive and sound decisions to reachfinancial goals. The National Endowmentfor Financial Education, NEFE, and theNEFE logo are federally registered servicemarks of the National Endowment forFinancial Education. For more informa-tion about the National Endowment forFinancial Education, visit www.nefe.org.

The Hispanic Scholarship Fund (HSF) isthe nation’s leading organization support-ing Hispanic higher education. HSF wasfounded in 1975 with a vision to strengthenthe country by advancing college educationamong Hispanic Americans, the fastest-growing segment of the U.S. population.In support of its mission to double therate of Hispanics earning college degrees,HSF provides the Latino community morecollege scholarships and educational out-reach support than any other organizationin the country.

Headquartered in San Francisco, HSF hasexpanded its operations in Southern andCentral California, the Northeast,Southeast, and Midwest. In addition, HSFlaunched the Washington, D.C.-basedHispanic Scholarship Fund Institute togenerate public partnerships in support ofits work. During its 27-year history, HSFhas awarded more than 54,000 scholar-ships in excess of $89 million to Latinosfrom all 50 states, Puerto Rico, and theU.S. Virgin Islands who have attendedmore than 1,300 colleges and universities.For more information about the HispanicScholarship Fund visit www.hsf.net.

Design: Nancy Chambers, MontanoSolaria

Photography: National Endowment for Financial Education/John MuellerProductions, David Muenker, and Povy Kendal Atchison

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Acknowledgments