How to Choose the Best College for Your Child—and Your Budget

Start with an honest conversation about your finances.

Medically reviewed in February 2022

One of the most important decisions parents and children have to make together is choosing the right college. There are many factors to consider, including the quality of academics, athletic options, campus culture and the size of the student body. But perhaps the most important factor is that of cost. From a financial perspective, how do you choose the right college? Here are some critical points to consider as you make your decision.

Have a candid conversation with your child about finances
All parents would like to send their children to their college of choice regardless of cost, and all children would like to pick a college without worrying about money. But for most of us, that isn’t possible; college is just too expensive. So, it’s best to be proactive and raise the topic with kids before they set their heart on a school you’re unlikely to be able to afford.

How do you do this? Well, it’s going to mean a straightforward discussion about your financial condition. You’ll need to talk transparently about your income and savings and what, if anything, you’ve managed to put aside for their college. Discuss how the cost of college could impact your lives—your retirement, for example. Share why you’ve made the financial decisions that you’ve made, and explain what financial commitments you expect them to make. (Should they take out loans? Get a part-time job while they’re at school?)

If your child understands how seriously you’ve taken this issue, they’ll be more likely to embrace that thoughtfulness as they approach this decision. Then you’ll be able to have more informed, less emotional discussions about, say, the pros and cons of going to a state school rather than a more expensive private one.

Crunch the numbers
When discussing college costs, don’t be afraid to get into the nitty-gritty. Tell your child what you’ll be able to contribute, and then look at the remaining costs of the college of his or her choice. How do you navigate the distance between Point A (what you can contribute) and Point B (what it’s going to cost)? And be realistic about costs—beyond tuition and housing, what additional fees and expenses can you expect? It’s easy to put these in a separate category and think you’ll worry about them later, but they’re really part of a larger cost picture. Plan for them now so you don’t have to worry about them later.

Follow the money
The second half of bridging the gap between what you can contribute and what college will cost is to itemize all relevant, potential sources of support. What scholarships and grants could your child qualify for? Researching and applying to them could be a joint project. Even if these are relatively modest amounts of money, every little bit helps—and engaging in the process is valuable training for your child.

Of course, take a good hard look at the student loan options available. You’ll need to think about the different loan sources, what it will take to pay back the loans and how much of a loan burden a particular college will justify. It’s an imperfect science, but college is an investment, and not every college justifies an equivalent investment. We all want to be sentimental about our child’s college experience, but paying for that experience—how much and how—requires pragmatism. What loan burden can you pay back? What are your child’s income expectations? A child who wants to work on Wall Street might feel more comfortable taking out larger loans than one who wants to be a public school teacher.

Choose for the right reasons
Think back to when you were in college—did you really know as much about that school as you should have before deciding to attend? Your child may be passionate about a particular college for a reason that might not stand the test of time. Perhaps she wants to major in engineering and the college has a great engineering department—but the school wouldn’t be her first choice otherwise, and you’re not sure she’s committed to that major. If she changed, would the school still be right for her?

To protect your investment, do your due diligence. Understand fully why your child wants to attend a specific school. Even better, make sure that he or she has thought through the choice in depth. If there’s uncertainty, you might consider a stint at a community college, which can help young people determine their long-term interests before committing to the greater financial expenditures of a four-year college.

After all, choosing a college is an expensive decision. But choosing the wrong college is an even more expensive one.

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