A dream of a college education can become a reality if savings are planned. However, financial experts recommend that saving for retirement should be a priority. If the budget allows, then additional savings may be considered for college education. Motivated students may find financial resources for their college education but there may be no additional source of funding for retirement. Students may pursue loans; grants; jobs; scholarships; tuition refunds from employers; participating in post secondary education options or “tech prep” as high school students; or joining the military.
There are a variety of ways that parents, grandparents and other interested persons can save for a child’s education. When choosing an option, consider the following:
- eligibility
- contribution minimums or limits
- tax implications; savings/investment options
- how the money can be used
- who controls how the money is invested, withdrawn and spent
- how eligibility for financial aid to the beneficiary is affected; and
- options available if the named beneficiary does not use the funds for educational purposes.
The College Savings Options Chart lists a variety of choices and summarizes basic information about each. It may be wise to consult an accountant or financial planner before selecting a college savings option. Most options will have fees that should be factored into projected earnings.
For more information, check out the following websites. Be sure to check the date on the web site materials to make sure the references are current:
