Public Affairs Officer – College Savings Plans of Maryland
January 26, 2015
In Maryland, we recently surveyed more than 1,000 families to see how they are preparing for the rising cost of college. Our research showed that 68% of families who are saving for college believe they will pay for all or part of their child’s college education. Of those not saving, 90% still believe that their child will attend a 4-year university. This financial commitment can be daunting, but not if you choose to plan ahead and do the proper research.
One strategy is to have conversations about college with your children when they are young. Talk to them about what they want to be when they grow up, and their interests. You can work with their teachers to find out their strengths and weaknesses in the classroom. You can also look into extra-curricular activities to enhance their skills. Establishing a college culture in your home can make a difference in your child’s college achievement and completion.
And while you’re talking to your children about their future goals, take time to set your own financial goals. There are ample resources available for families to review when it comes to saving. A 529 plan through your state can be a great addition to your savings strategy. 529 plans offer unique tax benefits – tax-deferred growth, and in some states, a tax break. These benefits can make your money work harder towards your goals. No matter what savings option works for you and your family, you’re taking a step closer to funding your child’s future education.
I have three nieces. My sister and brother-in-law started saving for their college education at the time each was a newborn, knowing that college would be in their future. One of my nieces, Brynn, just started the 6th grade and is in the STEM (Science, Technology, Engineering, and Math Education) program at her middle school. Brynn already knows that she wants to be an architectural engineer and wants to go to the Massachusetts Institute of Technology (MIT). She’s always asking for Legos so she can build things. She’s my mini-genius and I couldn’t be more proud of her! And with such big ambitions, my family is committed to making her dreams come true – even if MIT is $65,000 a year!
Of course, not every child knows exactly what they want to be when they grow up. But with a little guidance and financial planning from their parents and family members, college is an option. Saving money early will allow you to then see what colleges and universities you will be able to afford, without having to rely on financial aid and loans. Even the smallest contribution to a college education is better than nothing and it’s truly never too early or too late to start saving!
About the author:
Francesca Nelson is the Public Affairs Officer for the College Savings Plans of Maryland which offers both a 529 prepaid tuition program and a directly-sold 529 savings plan. Together, the plans have more than 177,000 beneficiaries with investments of more than $4.8 billion as of June 30, 2014.