It’s officially back-to-school season for millions of parents around the country. And whether you’re moving your college freshmen into their first dorm or sending little ones off to the bus stop, there’s one thing every parent has on their mind: the rising costs of college.
Over the last decade alone, the average cost of tuition for a four-year college has increased by nearly $8,000 — and that doesn’t include the rising costs of room and board, technology, travel, etc.
Student loan debt stands at a staggering $1.748 trillion, and many parents like you are looking for ways to help their future college students stay debt-free.1
One of the most common and useful tools helping to manage education costs is a 529 plan. These savings plans boast a tax advantage, as they typically allow tax-free withdrawals for qualified educational expenses. Some states even offer additional tax advantages, like deducting contributions from state income taxes. Aside from college tuition, funds from a 529 plan can be used to pay for other eligible expenses like K-12 tuition and student loan repayments.2
If you have a child or grandchild that you’d like to help prepare for college, a 529 plan is a useful tool for covering those rising costs. Before opening an account, please reach out and schedule some time to talk. There are a few considerations I like to review with clients in regard to education funding and its impact on other financial goals.
I wish all the young ones in your life a productive and engaging year back at school! Don’t hesitate to reach out if you’d like to talk more about your options for funding future education.
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How High Can the Cost of College Go?
September 14, 2022