Wednesday, August 6, 2008

Sallie Mae Launches ‘Education Investment Planner’ to Help Families Build a Customized Plan to Pay for College

BUSINESS WIRE --Sallie Mae, the nations leading saving- and paying-for-college company, today launched a new, free online tool that makes understanding the total cost of college and how to pay for it easier for students, parents, financial aid professionals and guidance counselors. The Education Investment Planner, available at, enables families to:

  • Estimate the full cost of a college degree: Find out how much four years for a bachelors degree, two years for a masters degree, or other programs will cost at a specific school, including the average growth of tuition over time.
  • Build a customized Plan to pay for college through a combination of their own money, federal and state grants, scholarships and, if necessary, federal and private student loans.
  • Compare schools: Compare actual costs for approximately 5,500 colleges and universitiesnot only tuition, but also average room and board expenses, fees, books and supplies.
  • Determine if they need student loans and, if so, estimate what their monthly payments could be after graduationand project how much a graduate would need to earn to keep payments manageable.

Sallie Mae developed the Education Investment Planner in response to feedback from customers and higher education policy advocates indicating that families need better ways to assess the cost of college and their choices for footing the bill. New data from a Gallup survey conducted in May and June, commissioned by Sallie Mae, found that 41% of families did not consider students expected income after graduation on their decision to borrow for college and another 29% said expected income made no difference their borrowing decision. Another study, Sallie Maes 2007 Survey of Parents of College-Bound Freshmen, indicated that parents want an honest assessment of the total cost of college: 39 percent of all respondents said the most helpful information from the financial aid office was an honest assessment of total costs over four years, and 32 percent said basic information about federal loans, private loans, and payment plans.

Sallie Mae offers this free online tool to help families make more informed choices about school selection by understanding upfront how to pay for it without going beyond their means, said C.E. Andrews, president, Sallie Mae. So often we think of financial aid in a one-year snapshot. We developed the Education Investment Planner as part of Sallie Maes commitment to financial literacy and to helping students and parents understand the full cost of a college degree.

The Education Investment Planner takes families through a series of questions, prompting users to model various funding sources, including 529 college savings plans, parent and student savings and income, scholarships, federal and state grants, institutional aid and other sources. It helps families follow Sallie Maes 1-2-3 approach to paying for college: first, use free money such as scholarships and grants; second, fully explore federal student loans; and third, fill any remaining gap with private student loans.

The college search and selection process is one of the most daunting tasks undertaken by high school students and their families, and the Education Investment Planner is a terrific step forwardsimple to use and a great confidence booster for families as they explore how to estimate costs and plan into the future, said Brian Ralph, vice president for enrollment management, Queens University of Charlotte, in North Carolina. As someone who works with prospective and current students, I know that students who plan well are less likely to struggle financially during their college experience, resulting in higher rates of student success and graduation. This new site will be a great resource to supplement the college planning process.

Using the Education Investment Planner, families considering student loans can explore various options and estimate monthly repayment amounts, better understand repayment terms and learn what beginning salary is needed to keep payments manageablebefore borrowing a penny.

Now is the right time for families to start thinking about their students futures, and having a free planning tool that helps educate families on how to save and pay for college is crucial, said Tom Burton, immediate past president of the Ohio Middle School Association. Starting early is the best way to make sure there are no surprises years down the road when its time for college.

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1 comment:

Debi said...

This tool is great for parents that need to visually see the financial picture. Parents can also include the college student in the process so they have an understanding of the total cost of a college education. Parents often shield their college students from the financial piece when they are very much part of the process. More advice for parents can be found at