College planning is an exciting time for you and your child. But, as exciting as it may be, there is a lot of preparation involved.
So, whether your child is entering into their freshman year of high school or a few months away from graduation, there is no better time to start planning than the present.
From figuring out your financials to helping your child prepare for admission exams, this college planning checklist for parents can help streamline your child’s transition from high school to college.
Starting a Savings Plan
College can be expensive. According to the Education Data Initiative, the average cost of college in the U.S. is $36,436 per year, including books, supplies, and daily living expenses. Indeed, the cost of going to college has more than doubled over the past two decades.
As prices continue to soar, it’s easy to become worried about how your child will pay for college or that they will have to take out a crushing amount of student debt in order to pay for the college of their dreams.
With this reality top-of-mind, it’s wise to start saving for your child’s college tuition and fees. But, while many parents may have the best intention of helping their children pay for their college expenses, they often fail to prepare.
So, even if your child is just now entering high school, you can still start saving and preparing for college costs. It’s never too late to start setting money aside for your children’s education.
💡 Quick Tip: You can fund your education with a low-rate, no-fee private student loan that covers all school-certified costs.
Paying Close Attention to Grades and Curriculum
Since grades and curriculum are crucial to getting an acceptance letter, you may want to keep close tabs on your student’s grades and study habits. From helping with studying to supporting homework expectations, getting involved with your kid’s coursework may help them perform better in school.
You may also want to encourage them to take Advanced Placement courses. Since AP courses allow you to tackle college-level material while your child is still in high school, your student may get ahead by taking some.
Also, if your student passes the AP exam at the end of the class, they could be rewarded with college credits. Racking up college credits could save you time and money in the future.
For example, if your child takes AP English in high school, they might be able to skip freshman-level English once they get to the college or university of their choice.
There are fees associated with taking AP exams. Fee reductions may be available for qualified applicants.
College applications were up sharply for fall 2023, according to data collected by the Common App. With the increase in competition, your child will need to stand out. While the top factors in admission decisions tend to be academics, the next most important factors typically include a student’s demonstrated interest and extracurricular activities.
Encouraging your child to get involved in the community could also potentially help them write a solid college application, and even help them decide what they want to do with the rest of their lives.
For example, if your child loves to run, they may want to try out for the track team to round out their classes or volunteer as a track coach for a youth team. Or, if they prefer journalism instead of sports, they may want to try writing for the school newspaper.
Not only will getting involved help with their college application but it will help sharpen their skills. So, don’t be afraid to encourage them to explore their passions and get involved with the school and/or local community. You might even want to get involved with them.
Planning for the SAT and ACT
Another key component to receiving acceptance letters from colleges and universities is having acceptable SAT and ACT scores. Some schools require the Scholastic Aptitude Test known as the SAT, while others may require the American College Testing, known as the ACT. Some schools will accept either one, but it’s a good idea to check the preference of the schools your child will apply to.
To help your child prepare, you can encourage them to sign up for an after-school prep class or practice at home by using online resources such as Khan Academy’s free SAT practice program in partnership with The College Board.
One of the most important components of college planning for your child is helping them decide which university or college is the right fit. Fortunately, there are plenty of options available to help you find a school that will fit your child’s education and experience needs.
To get started in the decision-making process you may first want to help your child decide what degree they would like to achieve. If they know they want to be an engineer, you may want to focus on schools with good engineering programs.
Even if you may think their degree is too niche, there is often a program that will support it. Whether they want to study astrobiology or comic art, there is often a program for your child. However, if they are unsure of a major, they may want help finding a school with more program options available.
It’s also wise to consider factors such as location and the type of college experience your child wants to have. For example, if they want to go to a school close to home and commute to save money, that desire will limit the search parameters.
Remember, while you may be the voice of reason, the ultimate decision is up to your child — the student. Simply help them evaluate all of the key factors in making an informed decision.
Scheduling College Visits
College visits can be a big help when it comes to finding the right fit. With this in mind, you may want to help your child plan a college visit well in advance of making a decision. The College Board recommends scheduling your visits during your child’s junior year in the spring if you have already researched schools.
For seniors, it may be best to schedule visits in the fall through the winter months. This may help seniors narrow down their options.
Since you want your child to get a feel of the college experience, you’ll want to make sure classes are in session. Therefore, it’s also wise to avoid visits during holidays or break weeks.
💡 Quick Tip: Would-be borrowers will want to understand the different types of student loans that are available: private student loans, federal Direct Subsidized and Unsubsidized loans, Direct PLUS loans, and more.
Investigating Financial Aid Options
Even if you have saved for your child’s education, you may want or need to explore other funding options, which could include your child taking on some of the cost.
Completing a Free Application for Federal Student Aid (FAFSA) is one of the first recommended steps to applying for student financial aid, whether that is in the form of grants, scholarships, federal loans, or work-study. Filing for the 2024-2025 school year opens in December, 2023 (a delay from the usual October 1) and will continue until June 30, 2024.
It’s recommended to complete the form as soon as possible because there are differing deadlines to be aware of, including for individual colleges as well as federal and state deadlines. The sooner you submit your FAFSA, generally, the better your chances of receiving aid will be.
Colleges and universities will use the information reported on the FAFSA to determine how much aid a student is eligible for. Even if your child has not applied to a school yet, they can list that school on the FAFSA, so encourage them to include their dream school as well as those they consider safety schools.
A Student Aid Report (SAR), which is a summary of information provided on the FAFSA, will be sent within three weeks — sometimes sooner. Corrections to the FAFSA, if needed, can be made after reviewing this report. The SAR contains information about a student’s Expected Family Contribution (EFC) (which will soon be called the Student Aid Index or SAI). It is recommended that the report be kept for your records.
The schools listed on the FAFSA will have access to the information within a few days of when the form is submitted. If your student is approved for financial aid, they will receive financial aid award letters from each school they applied and were accepted to. These letters will include information such as the cost of attendance (COA), EFC/SAI, grants, scholarships, loans, and other financial aid that your child might be eligible for.
Comparing each financial aid award letter can help you and your child determine the financial obligation of attending each school. It is recommended to exhaust all federal aid options before considering a private loan. But if you are looking for supplemental funding for your child’s education, private student loans may be an option.
If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.
Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.
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Whether you want to earn extra income to make ends meet or stay engaged with the community, there are plenty of reasons why you may decide to seek out part-time employment after you leave the workforce. And because these jobs don’t require 40 hours a week, you still have plenty of time to enjoy the retirement experience.
10 Part-Time Jobs for Seniors
Maybe your ideal part-time job allows you to work from home. Or perhaps you’re looking for a side hustle that keeps you moving for most of the day. Whatever your needs are, there are plenty of employment options to explore. Here are 10 to consider.
#1: Dog Sitter and Walker
Many people brought dogs home during the pandemic — and many of them need help with their companions while they work or when they go out of town. If you’re an animal lover and understand basic pet first aid, offering your services as a dog sitter and walker allows you to care for man’s best friend while also earning cash to help cover retirement expenses.
• General duties: Main duties generally include feeding, walking, and overseeing the care of the dogs. If you’re pet sitting, you might care for them in your home, stay in the client’s home, or check in on the pooches throughout the day.
• Average pay: A dog walker charges an average of $17 per hour, while a pet sitter charges around $15 per hour. However, rates vary by location and the services offered.
#2: Office Manager
Know how to make the workplace run smoothly? An office manager job may be right up your alley. Note that these jobs can sometimes be competitive, so you may want to contact former employers to see if there are part-time positions available. Or consider expanding your search to include a variety of industries. After all, the skills that the job requires — organization, time management, attention to details, problem-solving, communication — are essential no matter what type of office you’re in.
• General duties: These can vary by location but typically consist of coordinating administrative activities in an efficient and cost-effective way.
• Average pay: A typical office manager makes around $24 an hour.
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#3: Content Writer
If you have the writing chops, you may be able to find opportunities to hone your craft and earn some money. In fact, companies across the country need outstanding writers to create their content, so this could be an excellent choice for introverts looking for remote work.
• General duties: You may write content for companies to help them market themselves to potential customers or decision-makers. If you have technical skills — perhaps knowing about search engine optimization or photo editing — all the better!
• Average pay: A content writer typically charges around $37 per hour, though some prefer to charge a flat rate for each piece of content they create.
#4: Private Tutor
When it comes to retiree-friendly jobs, it’s tough to beat private tutoring. For starters, you have the option to tutor in person or over a video platform. It’s also a chance to help students with a subject you’re passionate or knowledgeable about. Plus, private tutoring can be a low-stress way to earn money.
• General duties: A private tutor provides one-on-one assistance to help one or more students learn and finish school assignments. This can involve studying the student’s textbooks or other materials and answering their questions on the subject matter.
• Average pay: Private tutors generally charge an average of $27 per hour, though that rate can vary by location and expertise.
💡 Quick Tip: Check your credit report at least once a year to ensure there are no errors that can damage your credit score.
#5: Retail Sales Worker
If you enjoy engaging with people and helping them to find what they need, there are numerous retail sales positions to consider. Do you love fashion? Look for jobs where you sell clothing and accessories. Interested in technology? You might be ideal in shops that sell computers, tablets, cell phones, and so forth.
• General duties: You’ll answer customer questions, provide courteous service, and accept payments for transactions. You may also stock shelves and tidy up your area.
• Average pay: On average, retail sales workers earn around $16 per hour.
#6: Receptionist
If your idea of retirement planning involves finding easy part-time jobs for seniors— easy on the feet, that is — and you enjoy talking to people, then a receptionist position could be the ticket. If you don’t mind working weekends, you may want to consider a position in a hospital, nursing home, or similar facility.
• General duties: Receptionists often greet customers or patients and help them register, if necessary. They also answer phones and offer general guidance to people who contact the organization.
• Average pay: Although pay can vary by the type of organization and the state where you live, figure an average of $18 an hour.
#7: Groundskeeper
Many of the part-time jobs for seniors on this list take place indoors. But if you appreciate spending time outdoors, you might enjoy being a groundskeeper. Note that depending on where you live, this could be a seasonal position, so you may need to adjust your budget accordingly.
• General duties: Groundskeepers generally mow lawns, edge, pull weeds, and plant and care for flowers.
• Average pay: The national average is $20 an hour for groundskeeping services.
#8: School Bus Driver
A school bus driver may seem like a surprising job for seniors, but the majority of part-time bus drivers are in fact over the age of 55. To get accepted for this job, you’ll need to have or get a commercial driver’s license, a clean driving record and background, and (probably) plenty of patience.
• General duties: In the mornings, you’ll pick up students from bus stops or homes and drive them to school. Later in the day, you’ll drop them back off. You’ll also need to manage student behavior on the bus.
• Average pay: School bus drivers earn around $20 an hour on average.
#9: Consulting
There are pros and cons of working after retirement, but one benefit is the ability to share your expertise and skills with others. A consulting gig can provide such an opportunity. By the time you reach 65, you’ve likely gained plenty of knowledge that you can impart to business leaders in your field. Plus, as a consultant, you can have a decent amount of control over your when and how much you work.
• General duties: You’ll analyze a situation from an outsider’s perspective, looking for inefficiencies and providing guidance based on your expertise. Typically, consulting is a contract-based position that could continue until a situation has been addressed.
• Average pay: The range for consulting work can largely depend upon your background and expertise. Sometimes, you might charge per project.
#10: Customer Support Representative
Whether your cable conked out or your income tax software hit a glitch, you’ve almost certainly reached out for customer support for help in times of need. If you’re a strong communicator and enjoy helping others, you may want to consider serving as a customer support representative yourself.
• General duties: You’ll receive phone calls or chat messages from a customer in need of a fix. You can help them solve the problems, create tickets for others to address, and offer outstanding customer service to keep people satisfied.
• Average pay: This position typically pays around $23 an hour.
💡 Quick Tip: Income, expenses, and life circumstances can change. Consider reviewing your budget a few times a year and making any adjustments if needed with a money tracker app.
The Takeaway
After you retire, you might be looking for a low-cost side hustle that can help bring in some income and keep you active. Fortunately, when it comes to part-time jobs for seniors, there’s no shortage of options to explore. As you review potential positions, consider your work experience, skill set, interests, how much time you plan on working, and how much money you could potentially earn.
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FAQ
Can seniors still work part time and receive Social Security benefits?
According to the Social Security Administration, once you reach the full retirement age, what you earn will no longer reduce your benefits — no matter the amount. As of 2023, if you’re below the full retirement age, the Social Security Administration will deduct $1 out of every $2 you earn above the amount of $21,240.
What skills and experience are needed for a part-time job as a senior?
Required skills will vary widely based on the position. If you’re applying to be an administrative assistant, for example, it’s important to be organized and capable of managing a variety of tasks in a professional way. Being a nanny, on the other hand, requires strong communication skills with parents and children alike. When you’re looking at job ads, check the requirements listed and see how closely they match your experiences and skills.
How many hours a week should seniors work part time?
There’s no one-size-fits-all number of hours a senior should work each week. They’ll want to consider a number of factors to determine the appropriate workload for them, including how much income they need, how much free time they have, and how much they’re able to earn and still receive Social Security benefits.
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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.
For a growing number of Americans, turning 65 no longer automatically means retirement. As of May 2022, 21.9% of Americans 65 and older were working, compared with 19.5% in May 2020, according to a survey conducted by MagnifyMoney.
If you want to keep up the 9 to 5 into your golden years, there’s a wide range of options for you to explore. This is especially true if you’re a skilled senior interested in full-time employment.
Tips When Finding a Job as a Senior
There are pros and cons and working after retirement. If returning to the daily grind is right for you and your financial situation, then there are a few things you’ll want to keep top of mind:
• Weigh the pros and cons of working for a company versus freelancing or consulting.
• Think about whether you’d prefer to work from home or go into an office or to a job site.
• Read the job listing carefully, paying close attention to the requirements listed.
• Remove graduation dates from your resume unless they’re fairly recent.
• Include a couple of your key accomplishments in a cover letter.
• During an interview, be sure to strategically share key career highlights from the past 10 to 15 years, and spotlight the ways in which you’ve kept your skills up to date.
• Move ahead with confidence!
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12 Jobs for Skilled Seniors That Pay Well
Working can help provide seniors with a degree of financial security as well as other benefits, such as connecting with coworkers and creating a sense of purpose. Let’s take a closer look at jobs for skilled seniors that suit a variety of skills and interests.
#1: Teacher
If you have the appropriate credentials, teaching can be a rewarding job. Don’t fret if you don’t have the right credentials — you might still be able to land a position. Many high schools, career centers, and community colleges may be open to hiring experienced people to teach general interest or professional development courses. Educational organizations may also be seeking teaching assistants or tutors, both of which can be excellent jobs for skilled seniors.
#2: Government Worker
Government jobs can offer competitive salaries along with good benefits, often including a nice pension. Even after you stop working at a federal government job, you may be eligible for the Federal Employees Health Benefits Program.
Depending on your background, education, and work experience, you may be qualified for roles with the National Institutes of Health, which participates in jobs fairs specifically for workers aged 55 and up; the Peace Corps; the U.S. Army Corps of Engineers; the U.S. Fish and Wildlife Service; and more.
#3: Tax Preparer
Interested in becoming a tax preparer? If you have an accounting background, then this type of work may be a natural fit. That said, you don’t need to be a certified accountant — you just need to obtain a Preparer Tax Identification Number from the IRS and pass a competency exam.
💡 Quick Tip: Check your credit report at least once a year to ensure there are no errors that can damage your credit score.
#4: Real Estate Agent
You can earn a good income helping people buy and/or sell their home or property. But there’s another selling point to being a real estate agent: the ability to set your own schedule, as long as you can still satisfy your clients. In fact, this flexibility can be useful if you’re deciding whether you want to work part time or full time. Before you start working, you’ll need to get a license, and requirements vary by state.
#5: Bank Teller
You typically only need a high school diploma or the equivalent to qualify for a bank teller’s job, and you may be required to undergo a short period of on-the-job training. In this position, you’d handle the standard transactions at the financial institution. So if you’re comfortable handling a steady flow of cash and enjoy working with customers, this could be a job to consider.
#6: Medical Biller
A medical biller works for a healthcare organization such as a hospital or doctor’s office and is responsible for appropriately billing insurance companies, managing the status of claims, and addressing problems that arise. This is one of those jobs for skilled seniors that require organization and the ability to follow through — in this case, with both patients and the insurance companies.
Plenty of small businesses in the United States need help with daily administration tasks. Depending on your skills, virtual tasks could include making phone calls, managing emails, scheduling appointments, maintaining calendars, offering bookkeeping services, handling social media, and so forth. Although many virtual assistant jobs are part time, if you wanted more work, you could have multiple clients to whom you provide your services.
#8: Telework Nurse or Doctor
Telehealth services have greatly expanded since the start of the pandemic, and demand for remote healthcare providers remains high. If you’re a recently retired nurse or doctor, and are still licensed, you may want to explore a telehealth position. It could allow you to continue providing care but from the comfort of home (or a home office).
#9: Counselor
Forty-seven percent of Americans live in an area with a shortage of mental health care professionals, according to data from the Kaiser Family Foundation. If you’re a retired counselor or therapist and are interested in working again, re-entering the field could allow you to provide much-needed services.
#10: HVAC Technicians
From installation to maintenance to repairs, HVAC pros can find themselves in great demand all year long. If you have this kind of experience, or are handy and able to incorporate HVAC into your skill sets, then this type of work can be a steady source of income.
Busy attorneys need plenty of help researching information, creating documentation, and contacting clients. If you have the education and experience — and you’re highly organized and able to multitask — then a paralegal job may be right for you.
#12: Grant Writer
Grant writing is a specialized type of writing where you’d write proposals to help nonprofits and other agencies to obtain funding for their programs. To succeed at grant writing, it’s important to research the requirements and deadlines of the funding, write compelling proposals to receive the grant dollars, follow up with the proposals, and write reports about them.
💡 Quick Tip: Income, expenses, and life circumstances can change. Consider reviewing your budget a few times a year and making any adjustments if needed.
The Takeaway
Your golden years are what you make of them — and for some, that can mean re-entering the workforce or pursuing a new, rewarding career path. Fortunately, there are plenty of jobs for skilled seniors that suit different skills and interests and provide a source of extra income.
See exactly how your money comes and goes at a glance.
FAQ
Can seniors still work full time and receive Social Security benefits?
According to the Social Security Administration, the answer is “yes.” If you’ve already reached your full retirement age, then you can work and earn as much as possible without a reduction in benefits. If you aren’t yet at full retirement age, then you can earn up to $21,240 in 2023 without a reduction. For income earned beyond that annual limit, your benefits would be lowered by $1 for each $2 earned.
What types of job skills are in high demand?
Management and leadership skills are appreciated by many employees, and these are skills seniors may well have developed over the years. It’s important to be able to effectively communicate, both verbally and in writing, and to work well with others. For many jobs, sales and marketing abilities are key, while in others the ability to research and analyze are crucial. Note that these are general categories. Specific skills will depend upon the job you’re applying for.
What type of work-life balance should working seniors expect?
Maintaining a work-life balance is especially important for working seniors. As you consider re-entering the workforce, you’ll want to consider your physical and mental health as well as your finances, and ensure that whatever job you take on will fit in your lifestyle. As an older adult, you may discover that you don’t have quite as much stamina as you once did. On the other hand, having children out of the home and on their own may open up more time than you expected.
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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
College is expensive and costs continue to rise. In 1989, the average cost of a 4-year degree school term was $1,730. As of 2023, the average annual cost increased to an average of $9,377 for in-state students at a public four-year college.
With college costs continuing to skyrocket, many parents apply for federal Parent PLUS loans. Since these loans are issued in the parent’s name, it is important that parents understand the details of what these loans entail and how often you have to apply to ensure students receive proper funding.
So, to avoid missing an application deadline, here’s some helpful information about Parent PLUS loans and their application process.
Parent PLUS Loan Recap
A Parent PLUS loan is a type of Direct PLUS loan, which is offered to parents who have a student enrolled at least part-time in an eligible education program.
Borrowers may be able to borrow an amount that equals but does not exceed the full cost of attendance, minus any other financial aid such as scholarships and grants that your child has received.
These loans are federally-funded and not subsidized. This means that the loan will accrue interest while the student is in school. Parent PLUS loans offer fixed interest rates and won’t change throughout the life of the loan.
The interest rate for Parent PLUS loans disbursed for the 2023-24 academic year is 8.05%. It’s also important to note that as of October 1, 2019, Direct PLUS Loans have a fee of about 4.228% of the loan amount (which is deducted from each loan disbursement proportionately).
Qualifying For a Parent Plus Loan
To qualify for a Parent PLUS loan, borrowers must:
• Be the biological or adoptive parent, or in some cases, the stepparent, of an undergraduate student enrolled part-time at an eligible school
• Have poor credit history (unless the parent meets additional criteria). More information on what is considered an adverse credit history can be found on the Student Aid website .
• Meet general eligibility requirements for federally-funded student aid
Keep in mind that even if a grandparent is primarily responsible for a student they are not eligible for a Parent PLUS loan, unless, grandparents have legally adopted their grandchildren and are legal guardians.
Applying for a Parent PLUS Loan
The first step to apply for a Parent PLUS Loan is to complete the FAFSA® form with the student. Then, parents can log in at StudentLoans.gov , choose the Parent Borrowers tab, and the “Apply for a PLUS Loan” link.
Most schools require you to apply for Direct PLUS Loans online, however, some may have different application processes that you must follow. Studentaid.gov provides a list of schools that allow you to apply online. If your school is not on this list, check with the school’s financial aid office to verify the application process you must follow.
Those who qualify for a Parent PLUS loan, will have to sign a Direct PLUS Loan Master Promissory Note (MPN) . This document verifies that the borrower agrees to the terms of the loan. Each school may have a different process, double check with the financial aid office to ensure you understand the specific process for your student’s school of choice.
Keep in mind, those borrowing more than one parent PLUS loan for separate children, will need to sign multiple MPNs.
Apply for A Parent Plus Loan Every Year
When you complete the FAFSA form , you are applying for financial aid for one school year. Therefore, to receive financial aid for the next year, you will have to submit a new FAFSA form to get new aid.
However, the website allows you to select a Renewal FAFSA form that remembers your information from the previous years, making it earlier to submit a new financial aid application.
Additionally, it’s important to pay attention to the FAFSA deadlines to avoid missing out on any financial aid opportunities. General recommendations suggest submitting the FAFSA form by the earliest financial aid deadline of the schools to which you are applying, usually by early February.
Each state may have their own deadlines, so it can help to verify your state’s specific date.
Pros of Parent PLUS Loans
First, eligible borrowers can take out a generous Parent PLUS loan, as long as it doesn’t exceed the total cost of attendance at the student’s school of choosing (minus other financial aid they qualify for).
Another advantage of the Parent PLUS loan is that the interest rates are fixed. This means that even if rates increase nationally, the interest rate on the loan is locked in at the rate determined at the time the loan was disbursed.
Having a fixed interest rate can make it easier to budget for the monthly payments when they become due since borrowers know exactly what to expect.
Additionally, when it comes to loan repayment, there are several flexible repayment options . For example, you could select a standard repayment plan with fixed monthly payments for 10 years or an extended repayment plan with either a fixed or graduated payment schedule over a 25-year term.
Parent PLUS loans are not eligible for income-driven repayment plans, unless they have been consolidated with a Direct Consolidation Loan . This is when multiple federal loans are consolidated into one single Direct Consolidation Loans. These loans are still federal loans and the new interest rate is the weighted average of the existing loans.
Borrowers can select the best repayment option based on the plans they qualify for and their goals for repayment. Whether the goal is to keep payments low or pay off the loan balance as soon as possible, borrowers can select a plan that best fits their needs. Generally, selecting a repayment plan that helps pay off the loan quickly will result in paying less interest over the term of the loan.
Cons of Parent PLUS Loans
Not everyone qualifies for a Parent PLUS loan. Although this isn’t necessarily a disadvantage to a Parent PLUS loan, it’s important to understand that you will have to meet all eligibility requirements to qualify. This includes passing a credit check.
Adverse credit indicators include defaults of debt, foreclosures, repossessions, debts discharged through bankruptcy, tax liens, wage garnishments, or previous write-offs of federal student debt.
However, you might be able to qualify if you apply with an endorser or a cosigner. Keep in mind, you also need to be a United States citizen or national.
Alternative Financing Options
If your application is denied due to poor or “adverse credit history,” there are still other financing options. Here are a few to consider:
Enlisting an Endorser
If a parent doesn’t qualify based on their own credit history, they can try to enlist a co-signer , called an endorser, on the Parent PLUS loan. The endorser agrees to take responsibility for the loan if the borrower fails to repay, and the loan will show up on the endorser’s credit report as his or her own debt. If you apply with an endorser, you will be required to complete PLUS credit counseling .
Looking for Free Money
It can be wise to continue to apply and look for scholarships, work-study, or grant rewards. There’s a myriad of ways to find reward opportunities such as contacting the school’s federal aid office, federal agencies , state grant agencies , or other organizations a student or parent is involved with.
New opportunities may become available every year, so it can be wise to continue to stay out on the look for funding opportunities.
Applying for Unsubsidized Federal Loans
If a parent is ineligible for a Parent PLUS loan, the student may be eligible to receive additional Direct Unsubsidized Loan funds up to the loan limits for independent students.
Federal student loans can be reliable borrowing options because they often have lower interest rates and could have better repayment terms than other loans available to students. However, it’s worth making sure that a student isn’t taking out more debt than they can handle after graduation.
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Considering Private Loans
Lastly, if all other options fail, some families may want to consider private loans. These loans are offered through financial institutions such as banks, credit unions, and online lenders.
Keep in mind, private student loans tend to have less flexible repayment terms and higher interest rates than federal student loans.
For example, private lenders may require you to begin making payments before your child graduates. Conversely, with a Parent PLUS loan, parents can wait to make repayments until after their child has graduated.
Additionally, when applying for a private loan, the interest rate is generally based on factors like the borrower’s income and credit score.
If you think you may need to use private loans, don’t be discouraged, and instead, be informed about your options. First, it’s worth shopping around and comparing lenders for private loans.
Lenders’ terms will vary, so it can be helpful to get several quotes and ask about the interest rate (and whether it’s fixed or variable), the loan’s repayment terms, and what happens in the event there are financial difficulties that make it difficult to stick to the repayment plan.
If you do determine a private student loan is right for you, check out SoFi, where parent student loans are built to help you pay for your child’s education. SoFi loans have no fees, and qualifying borrowers can secure a competitive interest rate.
Check out what kind of rates and terms you can get in just a few minutes.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs.
SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.
Do you ever have trouble keeping up with when bills are due and paying them on time? Welcome to the club. It can be a challenge for many busy people, but paying bills on time is important. Doing so helps you dodge those pricey late fees and maintain your credit score.
For many people, a solution to this challenge is to set up automatic bill payments. This can be done through an automatic payment system, usually referred to as “autopay.” This means that, without needing to remember any dates, write any checks, or click on any payment links, your recurring bills are seamlessly taken care of.
This can be a game-changer that helps you enjoy stronger financial management status and less money stress. But it might not be right for everyone. As with most financial tools, there are pros and cons to using autopay.
So what is autopay? And how do you set it up? Learn the answers to these questions, along with the pros and cons of autopay, so you can determine whether to consider using this option.
What Is Autopay?
What many people call “autopay” is a scheduled, regular transfer of money, usually monthly. These payments are generally transferred from the payer’s bank account (or credit card) to a vendor, or what is known as a payee.
When you link an account to a particular bill or vendor, autopay usually works over an electronic payment system called ACH.
Autopay is typically set up in one of two ways.
• The first is through the company receiving the payment.
• The second is through a bank’s online bill-pay portal.
When you link an account to a particular bill or vendor, autopay usually works over an electronic payment system called Automated Clearing House (ACH). Sometimes automatic payments are referred to as “ACH payments” instead of autopay. If you were to use your credit card, the recurring payment would simply show up as a charge on your card.
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How Does Autopay Work?
Here’s a closer look at how autopay works. When autopay is set up, you are authorizing debits to occur on a regular basis. You will not be responsible for sending the funds. Some people may see this, however, as not being in control of their money.
When autopay is set up, either the payee is authorized to deduct funds from your bank account or your bank will send the funds for you.
You do need to pay attention to when your funds are whisked out of your account. If you aren’t on top of your finances, you could wind up in overdraft and getting assessed overdraft or NSF fees, plus late charges.
Autopay vs. Scheduled Payments
You may hear the terms autopay and scheduled payments used interchangeably but they are actually quite different.
• Autopay means that payments have been set up in advance to happen regularly on a certain date. You establish the date and the frequency and then don’t need to do anything else to transfer the funds on a recurring basis.
• With a scheduled payment, however, you are manually setting when you want a payment to be made and for how much. You can do this regularly, of course, but it requires more effort on your part to transfer funds.
Autopay vs. Bill Pay
Here’s another situation in which you may hear two terms (autopay and bill pay) used interchangeably. There is a slight difference, however.
Bill pay refers to the process in which your bank initiates payments from your account to the payee. In other words, the payee is not authorized to go in and deduct the money; your bank is instead providing this service.
Setting Up Autopay
Here is some more detail on setting up autopay so you can have your bills taken care of more easily.
1. Looking at Vendor Requirements
You can think of autopay as either pushing money from your account to the vendor, or the vendor pulling money from your account.
Many vendors require you to set up autopay through their website, so your first step may be to look into their requirements. If you are currently receiving a paper bill, they often include instructions on where you can go online to set up autopay — looking there is a good place to start.
For example, if you have a $1,800 monthly mortgage payment, you may be able to provide your mortgage company with your checking account information (such as your bank account number and routing number). They can pull the money for payment automatically. This is the “pull” version of automated payments as the vendor is pulling the money out.
2. Choosing the Day Your Payment Is Made
You generally get to choose the day that the payment is made — you could consider doing this a few days before the bill is due. This should give the automated payment time to move through the ACH system, including when the due date lands on a weekend.
Also, you’ll likely want to be cognizant that you aren’t setting up any automatic payments until you’re sure that any necessary deposits are made. For example, if you need your paycheck to cash before making a rent payment, making sure to give your paycheck at least a few days to settle in your account may be the pragmatic choice. Or you could see if the payee is willing to move your bill’s due date slightly to better accommodate your needs.
Setting Up ACH Payments
Another potential option is to set up an ACH transfer through your bank; this is the bill pay option mentioned above. Doing this typically requires logging onto your bank account’s website and navigating to the bill pay section.
If you go through your bank, you may need to provide them with the information for the vendor, such as the account number and mailing address. You can usually find this information on your bill or monthly statements.
Using the same example as above, you would enter the information for your mortgage lender into your bank’s bill pay portal. Similarly, the money would be sent via ACH on the date you’ve picked to send the money to the vendor.
You may want to consider selecting a date a few days prior to the due date to avoid a late payment. This is the “push” method of automated payments as you are pushing the money out of your account to the vendor.
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Pros and Cons of Autopay
Autopay can be a wonderful tool for many people looking to simplify their finances. But it won’t be for everyone. Here’s a look at some of the pros and cons of using autopay.
Pros of Autopay
Consider these upsides of autopay:
Convenience: Gone are the days of sitting down to write a check for every last outstanding bill. In fact, these days you don’t even need to log into a computer every time a bill comes due. With autopay, you can pay all or most of your bills without lifting a finger.
This means no more having to log online to pay bills while you’re on vacation or busy with work or family. There is something beautiful about the convenience of the “set it and forget it” method to financial management, if you can make it work.
Improving Your Finances: We don’t need to tell you that it is a smart idea to pay your bills on time.
Not only can autopay help you to avoid frustrating late fees, but taking care of your bills right away may help you to avoid agonizing or allowing it to take up precious room on your to-do list.
Paying your bills on time may help your credit score.
Also, paying your bills on time may positively impact your credit score. Currently, debt payment history is the single biggest factor in terms of determining your score. It makes up 35% of a FICO®️ Score.
That means that paying debt-related bills, such as a mortgage, car loan, or credit card bill, on time, could potentially positively impact your FICO®️ Score.
Learning Good Behavior: If you can take the philosophy behind automatically paying your bills and apply it to your savings strategy, this may help your overall financial success. Just as you can automate the payment of your bills, you can automate your savings to retirement and other savings accounts.
If you don’t automatically set money aside, it can be far too easy to spend the money that lands in your checking account. Warren Buffett famously recommended that people “spend what is left after saving, do not save what is left after spending.”
Other ways to use automatic payments? Pay down debt aggressively or save for your future (even beyond a 401(k) if you have one). In either of these scenarios, you could simply set up an automatic transfer of funds as you would with autopay, but direct the funds toward your financial goal.
That way, the money is whisked from your checking account before you’ve even had the chance to consider spending it.
Potentially Saving Money: Vendors and service providers want to get paid on time. Therefore, some vendors or service providers offer a discount for customers that set up autopay, which could save you money.
For example, you may receive an interest rate discount if you set up autopay for a loan. Other vendors may provide a discount on their product or service if you use autopay.
Possible Overdraft Fees: If there isn’t enough money in your account to cover a bill, an ill-timed automatic payment could cause your account to overdraft. According to the FDIC (Federal Deposit Insurance Corporation), overdraft fees can average $35 a pop, depending on your bank.
You’d need to be especially careful if you leverage multiple checking or savings accounts with fluctuating balances or tend to keep your account balance close to zero. In the latter situation, you might benefit from keeping a cash cushion in your account.
Late Fees: Consider the transaction time when setting up your autopay in order to avoid annoying late fees. Late payment fees will vary by vendor but could be costly.
While giving yourself, for example, a four-day buffer could be a good start, it’s important to check with each vendor to determine their recommended timeline. Finally, after you’ve set up autopay, monitoring payments during the first few months to be sure they happen on time can help ease the transition.
Potentially Reinforcing Bad Habits: For some people and in some specific cases, it may not be a good idea to have your finances on autopilot. For example, those who are actively paying off credit card debt may want more control over how much they pay towards their debt each month.
There is almost always an option to autopay the “minimum payment” on a credit card, which may be tempting. There is no penalty when you pay the minimum payment, so it is certainly better than doing nothing.
But, it is much better to pay off the balance in full, if possible. When you do not pay the balance in full, the card will accrue interest, costing you money over time.
If you aren’t at a place where you can pay off the entire balance quite yet, you may want to try and set your autopay for an amount that’s more than the minimum payment so you can make progress on the balance. (And you may want to try to stop using your card in the meantime if this is the case.) If this won’t work for you, you may want to remain in manual control of payments.
Paying for Things You Don’t Need: Subscription services are sneaky. Amounts may seem small and you hardly notice them on a monthly basis, but they can wreak havoc on your annual budget. It is too easy to forget that you are paying for something, especially when you don’t use the service.
If you take advantage of the perks of autopay, don’t forget to reassess your subscriptions every few months to determine whether you actually need the thing you’re paying for. One example: You might not realize how much entertainment you are signed up for, and could save money on streaming services by dropping a platform or two.
Potentially Less Monitoring of Your Accounts: One issue with using autopay could be that you develop a sense of false security that your personal finances are running just fine. You might not check in with your money and review your spending as often as you might. This could have a negative impact. How often should you monitor your checking account? For many people, a couple or a few times a week is a good pace.
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Should You Use Autopay?
The digital age can be confusing and overwhelming, but this is one case where it may help to simplify our lives. Managing money can be a tedious task, and paying bills is just one part of it.
By streamlining the bills portion, you may find that using autopay gives you more freedom to focus your attention on other financial goals.
That said, autopay won’t be right for everyone and in every circumstance. For example, autopay might not be a great idea for those who haven’t organized their bills and tend to overdraft their accounts. It may not make sense for someone who is between jobs or out of work.
Autopay could potentially be difficult to manage for freelancers or other workers with variable income throughout the month. Ideally, a person would have some cash buffer for bills in any of these scenarios, but that is not the way it always works out in the real world.
💡 Quick Tip: When you overdraft your checking account, you’ll likely pay a non-sufficient fund fee of, say, $35. Look into linking a savings account to your checking account as a backup to avoid that, or shop around for a bank that doesn’t charge you for overdrafting.
The Takeaway
Autopay can be a convenient way to get your bills taken care of with less time, energy, and stress. However, in some cases, it can have its downsides, so it’s wise to know the pros and cons and continue to monitor your money carefully if you do sign up for autopay.
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FAQ
What should you not put on autopay?
It can be wise not to put bills that fluctuate on autopay. You are less likely to wind up with an overdraft situation that way. For instance, if your energy bill is usually $100 a month but goes up to double that during the winter or summer, that might throw off your personal finances if you autopay your bills.
When should I set up autopay?
It can be wise to set up autopay when you are familiar with your finances and cash flow and feel confident that automating your payments won’t lead to an overdraft situation. You might also consider signing up if there is a bonus or perk for you, such as a discount or a lower interest rate.
Why do people not use autopay?
Some people do not feel comfortable with autopay; they would rather be in control of making payments individually and maintaining that control over their finances. Also, some people may have bills that fluctuate considerably and they may therefore prefer to pay manually to avoid overdrafting.
SoFi members with direct deposit activity can earn 4.30% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.
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