By Bonnie Carroll
Marketing Director, Education Trust of Alaska
August 11, 2014
What would you do if your newborn tried to make this deal with you? Would you be able to find the time and funds to open a college savings account? I’m pretty sure even the most cash poor, sleep deprived parent would manage to open a 529 account if it meant a good night’s sleep. Many parents post pone saving because they feel they can’t find the time and they don’t have the funds. But the truth is, it doesn’t take much of either to get started and infancy is the best time to begin.
Helping families save for college has been very rewarding, especially recently as I’ve begun my own journey as a parent. I work every day to promote saving for college to the residents of my state while I myself am also trying to save for my son and daughter’s college expenses. One thing I’ve observed over and over in the past 15 years is that saving for college gives parents a sense of pride and confidence because they’re doing something great for their kids.
We know that when children have a savings account in their name, they’re more likely to attend college because the existence of the account sets the expectation that college is part of their future. I enjoy talking to my children about saving and about college to test some of these theories we hear in my industry. My kids love to discuss what occupations they’d like to try and it’s fun to hear about the creative professions they make up for themselves. The amazing thing is that even at a very young age they understand the need to plan and save.
My son recently had what my colleagues and I refer to as a college savings “freak-out moment.” He came to me one evening and rested his head on the couch, looking forlorn. He explained that he knows college is expensive and that in his entire life he had only saved one dollar. His dollar bill, which he had earned about a year ago, has been sitting alone in a jar in the kitchen cupboard ever since. He wondered how he was supposed to go to college when money is so difficult to earn.
Situations like this make great opportunities to talk about how the whole family is helping him save. I explained that when he graduated from diapers we were able to up his monthly contribution, and again when he completed pre-school and began kindergarten. He was genuinely relieved.
Set up an account today or make an extra contribution to your existing one. You and your children might be closer to a good night’s sleep than you think.
About the Author:
Bonnie Carroll works with the Education Trust of Alaska which offers the UA College Savings Plan, the T. Rowe Price College Savings Plan and the John Hancock Freedom 529 plan. The programs manage more than $6.5 billion for 320,000 accounts. Carroll is a 15 year member of the College Savings Plans Network. She works, plays and saves for college in Anchorage, Alaska.