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Education Planning - Coggle Diagram
Education Planning
Types of Student Loans
Perkins Loans:Best loans possible from the federal government. They are need based. And the schools get limited amount of money from the government and is in charge of distributing these loans based on FAFSA.
Subsidized and Unsubsidized Stafford Loans: Allows individuals to pay for their own education. Subsidized loans are when the government pays your interest until you graduate. With Unsubsidized loans you do need to pay interest while you are in school. But with both, you do not have to start making payments until 6 months after you graduate.
Parent PLUS Loans:They are distributed through both private and government lending programs. Have a fixed rate.You need to qualify through your FASFA form. There is a higher loan fee and higher interest rates.
Private Loans:They are granted on your financial ability on how fast you will pay it back. They have variable interest, meaning the interest rate can vary month to month.
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529 Plans
- Contributions need to made in cash or check
- A total of $15,000 can be given to the beneficiary in 1 year.
- An individual can contribute a total of 5 years worth in one sitting. $75,000
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Types of 529 Plans
Prepaid Tuition Program:Allows for the advanced purchase of credits for an institution in that state. This can be good because of the rising tuition problem. But this terrible because you can only go to college within that state.
College Savings Plan: A separate account only for educational savings, but it allows the beneficiary to invest in mutual funds
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