Daily KPB| Understanding Student Loans and Financial Planning in Recruitment - a podcast by Keep Playing Baseball

 *Pilot Episode: The Daily KPB

This podcast is the audio version of our blog article, Understanding Student Loans and College Debt During Recruitment.

The uncertainty and excitement of the recruiting process can lead parents and recruits to make some short-sighted decisions. College coaches are often eager to close the deal and get a player committed once they make an offer. As a parent or recruit, it’s easy to get carried away by the excitement of the moment and make a hasty or poorly thought-out decision. When the recruiting process starts to pick up steam, that’s when you must slow it down and make sure you are thinking things through. While it may seem like many stages of the recruiting process require an immediate answer, there are few decisions that must be made right away. Be comfortable taking time to think things over appropriately. Remember, your son’s college decision is about much more than what baseball team he will play with for the next 4 years. The long-term financial ramifications of college student loan debt can burden graduated players for years after they graduate. Coming up with a practical financial plan is an incredibly important part of the recruiting process. In this podcast, we will discuss how to do a basic budget exercise on the costs of attending college so that your son can chase his baseball dreams, get a college education, and graduate with a manageable amount of student loan debt. 

Step 1: Understanding Your Budget

If you are familiar with our website, you already know that college baseball is not a full-ride sport. That means even if your son is lucky enough to earn a baseball scholarship, it’s likely to only cover a portion of his total costs to attend college. The first thing you need to do is sit down and figure out how much money your family can afford to pay out of pocket each year for your son’s college expenses. For this example, we'll say your family can afford to pay $5,000 out of pocket each year towards your son’s college costs.

Step 2: Understand the Cost of Attendance for Each School of Interest

The total cost of attendance is the amount of money it will cost for your son to attend a college or university for 1 academic year and it includes tuition, room and board, books, and some other student fees. For example, Big Time University ("BTU") may have a cost of attendance totaling $20,000 per academic year.

Step 3: Understanding Out of Pocket Costs

Out of pocket costs are the amount of money you will be expected to pay once academic and baseball scholarships and grant money are taken into account. Out of pocket costs are the amount of money you will have to come up with on your own for your son to attend a college for a year. For example, if BTU offers your son a $5,000 yearly baseball scholarship, a $2,000 academic scholarship on top of that, and you qualify for a $5,000 in federal grant money based on your FAFSA submission, out of pocket costs would be $8,000, which you would reach by subtracting your scholarship and grant money from the total cost of attendance ($20,000—$12,000= $8,000).

Step 4: Determining Amount of Borrowed Money

The amount of money your son would need to borrow or take out in loans would be the Out of Pocket Costs—Your Annual Budget. In the case of the BTU example, if your son wanted to attend BTU, he would need to take out loans totaling at least $3,000/year after subtracting the amount your family can afford to pay ($5,000) from the out of pocket costs ($8,000). If your son is able to maintain his scholarship and grant money each year and graduate in 4 years, he will need to borrow a minimum of $12,000 in student loans. 

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