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2018 Hawai‘i College Guide

(Sponsored) Application to Acceptance: How to find the right college, the money to pay for it, and sushi rice on the Mainland. Plus, tips from local students on everything from campus visits to going Greek.


(page 4 of 17)

Find the College Savings Plan That Works for Your Family

American Savings Bank urges customers to go to a branch and make a plan with the advisers there.

By robbie dingeman


College guide


Some families start saving for college the moment they know their little one is on the way, while others find themselves planning much later. We asked the local financial experts at American Savings Bank to give us the straight scoop on saving for school.


Get Some Help

First thing, talk to someone where you save your money. That’s the word from Cynthia Hermosura, the first vice president regional executive, West O‘ahu Region, for American Savings Bank. She’s had a lot of experience working with people who are saving money in all kinds of circumstances.


Her advice? Start a savings account as soon as you can, even if you’re putting in a modest amount of money. “We always try to encourage savings,” Hermosura says. “We know that it’s hard for students to save in college.”


Doing It Debt Free

How can savings pay off? Well, listen to Hermosura’s story of a pretty typical O‘ahu parent who saved every year and focused on paying off each year’s tuition: first preschool, then private school from kindergarten to grade 12, and then college.


“I have a friend who started saving when her daughter was born,” Hermosura says. “It’s not that she had a six-figure job or anything, but she was disciplined. Through wise investing and being very disciplined, she was able to pay the bill at Punahou, and four years of Johns Hopkins.”


Hermosura acknowledges that her friend’s daughter worked hard, and got grants and scholarships to help: “Her daughter is very bright. She loves academics. Everything really clicked and fell into place.” But it took the teamwork of her mom’s focused savings and the daughter’s determination to make it happen.


College guide graduation

Photo: Bigstock


Find Out Your Financial Options

Hermosura says the best thing to do is go over your family finances with a financial adviser who can sort through the options. Some accounts offer tax deferrals and state tax breaks to help, “because the cost of college, that can be crazy,” she says.


And if you haven’t been able to save enough to cover tuition, there are other good options, she says. “A lot of our customers tap into the equity of their home—their biggest asset. They’ll take out a line of credit or a loan.”


This is also a good option for families who haven’t been able to save a lot. Interest rates are normally very low. And homeowners may be able to take a tax deduction on the interest they pay.


Loans That Pay Off

Hermosura says one of the best ways for college students to establish credit is through secured credit cards or secured loans. That means, if they want a $500 limit card, they have to put $500 in an account. Pay it responsibly and pay it on time, and then they’ll have an unsecured card.


She advises students to use credit cards wisely: “Pay it in full when you can; never pay just the minimum. And try not to max out the line, that’s also a sign that there’s some trouble there.”


Proving you can use credit responsibly can lead to a high rating, Hermosura says, which “can be better than money in the bank.”


At American Savings, she advises families to go to a bank and talk to a personal banker or manager. “They can help uncover their needs and their dreams and help them with their resources,” Hermosura says. “We know customers are so in the day-to-day-workaday world, they don’t even think they can have dreams.”


Hermosura has worked at the bank for more than 38 years: “I started out as a teller and I just love what we do. We really see that we have an impact on people’s lives and it really feels good.”


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