i paid my way through school via, military service, working multiple part time jobs, some student loans. i already had an adult lifestyle to support so it was a bit more expensive than most highschool directly to college transitions are.
my personal and professional advice are:
1) parents you are not obligated to pay for your child's entire college education. in fact, i find more value in the educational experience if the child has to participate. have them fill out the forms and track the money. obviously you will supervise and monitor the process, but there is a greater chance of financial responsibility when they see how the money got into the account and understand what repayment means.
2) student loans, if taken, should be in the child's name. make it clear to the child that THEY will be responsible for repaying the loan upon graduation - not you. when they are pissing away $$$ on pizza, beer, etc. it might help to control the expenses if they know they are the ones footing the bill. probably not much, but every little bit helps.
3) loans aren't all bad, either. the child will eventually need to be a self sufficient human. as such, they will need credit. student loans are a good intro to this world.
financial aid horror story? who me? well, ok. my first semester back to school, i was still married and she was working a pissass job (couldn't handle the stress of a real one), i was taking 21 sem hours, working 1 full time job and 1 part time. i wanted to drop down to part time so i applied for the student loan. i was given @$900 for the whole semester. how is that? the kid sitting next to me was just talking about how he went and bought a $20,000 truck with his loan check, because mom and dad were paying for everythng, so it was just play money. i went to the office, waited my turn and asked the nice gentlemen
if there was some mistake. surely on my limited income i could qualify for a LOAN. he got snotty and pointed out that i should have saved more money while i was in the military. i said sorry, but i did the best i could. he then told me i made too much money to get more of a loan - there were people who weren't working at all who needed the loan more.
i tried to reason with him. he was just nasty. then he tripped my trigger. "all you veterans think we owe you something just because you went to some sandbox on the taxpayers bill to take pictures and goof around."
he went a little further, and then i stood up and with a great big smile let him know that i was about to drag him over his desk and kick the shit out of him just for the hell of it - i mean hell "what are you going to do - take my $900 away?"
at that point he picked up his phone and called security. fortunately for me, i had gone to high school with the two that showed up. nothing happened to me.
i did find out that even though it is gov't money that shows up, the individual school gets to decide how to split it up.