Getting Sick at College: Some Financial Considerations for Parents
By Joe Messinger, CFP®
August 7, 2020
Every fall, parents send their children off to college. The anxieties for parents can be many. One big one…What happens if your child gets sick at college? Having a sick child who is away from home can be scary, but today with COVID-19 some extra advance planning can be a good idea. What do parents need to think about? What are the financial considerations to keep in mind?
Talk with your student (often) before they leave
Talk about how to stay safe. Review the college’s procedures together carefully. A weekly phone call could be more important than ever this coming semester. Parents will want to stay in touch. Be there to listen to them. Their mental health and anxiety will be impacted by this out of the ordinary year. Ensure your child knows how to use their health insurance card and how to pay for co-pays at the time of an appointment.
If they do get sick, having a plan in place beforehand is a great idea. Again, be sure to refer to the university’s guidelines. Many have laid out plans for students who get ill with COVID-19. Does your student go to the health clinic? Do they stay in their dorm room or quarantine somewhere else? Should your student have a small bag packed with necessities in case they need to quarantine?
We aren’t experts in these health areas. Just sharing a few thoughts. Refer to your college’s guidance and the CDC website. (This parent checklist from the CDC is for K-12 parents, but still is a good reference to review.) In addition, families should think about the legal documents they should have in place since their college student is an adult.
What happens if they get sick at college?
If your child gets ill, the college probably will have a plan in place for what you do next. However, students need to be sure to get in touch (and stay in touch) with all their professors and their advisor. We can’t know how getting ill with COVID-19 will impact coursework deadlines so as with everything communication is key.
If a student will not be able to complete their school work for the semester, ask for a leave of absence. Don’t just accept a failing grade on every course. It is more important that a student withdraw or take a leave of absence instead. We expect that colleges will be much more understanding when withdrawals are a result of COVID-19.
Get in touch with the financial aid office.
If a student received federal student aid like Pell Grants, Stafford loans, or PLUS loans, the college may need to refund all or part of that money depending on how many days of the semester were completed. If a student completes more than 60% of their semester term before withdrawing, the college does not have to refund the money. Students have earned 100% of the federal funds received. If a student does not reach that 60% of the term time period, a pro-rated portion of the funds are returned to the government. State aid, scholarships, and private loans may also be impacted by a student’s withdrawal.
If a student plans to be away from college for more than six months, any past student loans will come out of their grace period, and monthly payments will begin.
What is tuition insurance?
Tuition insurance is a type of policy purchased to reimburse the family when a student get sick at college and can’t finish their term. The family may be out some of the tuition, room, and board they paid for that semester. If the withdrawal is due to a covered loss, the policy will pay to make the family whole again. You can read more detail about tuition insurance on the National Association of Insurance Commissioners website.
Most policies exclude pandemics like COVID-19 from their coverage; however, some companies are making exceptions in this particular case. A tuition insurance policy may also provide coverage for things like assistance with travel expenses, transportation to a medical facility, or even arranging to have the student’s car driven to their home because they are unable to do so.
If you are considering tuition insurance, be sure to completely understand the costs, what is covered, and all exclusions. Check out the refund policy for the college. At what point in the term does the student no longer get a refund if they withdraw from a class?
Other financial hardships
If the family is suffering (job loss, medical bills), the financial aid office may be able to provide more aid–even in the middle of a semester. Colleges may not be able to help, but notifying them of changes to a family’s financial situation is always a good idea. Families will need to be able to provide documentation of changes. Each college will have their own process for handling appeals.
Hopefully your family won’t need any of these tips.
We just wanted to provide some tips for the conversations you can have now before colleges starts, and things to be thinking about should your child get sick at college and they need to withdraw from school because of illness. Stay safe!
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