Whether it’s your first child or your last child, sending your kids off to college can be challenging, emotional and at times extremely stressful. One of the most important things that you can do to make this transition easier is to be prepared. If you have young kids, college seems like an eternity away. Let me be the first to tell you that you will blink and those days of sleepless nights, carpooling to activities and family dinners will be a thing of the past. It goes by SO fast.
My oldest child is starting his senior year of High School in a few short weeks and I have started to enter panic mode. Have I taught him the life lessons he needs to know to live on his own? Have I encouraged him enough to have the confidence to make good choices? Have I saved enough so we don’t have to go into debt to provide him an adequate college education? Have I told him I love him enough? I could go on and on…. But out of all of these questions I am pondering the one thing that I know I have control over is his college savings. According to the College Board, the average cost of tuition and fees for the 2016–2017 school year was $33,480 at private colleges, $9,650 for state residents at public colleges, and $24,930 for out-of-state residents attending public universities. These numbers are based on tuition only, not room and board and everything else that comes with outfitting your college student. Take that times 4 years and UGHHH!!!
Thankfully, years ago, my husband and I started a 529 savings plan for our children to help with the growing cost of a secondary education. We don’t always make the right decisions when it comes to our kids, but setting up a 529 savings plan when they were still in diapers was one of the best decisions we have ever made. Do you have a college savings plan for your children? At #TRPG we are here to answer any questions you may have and help you figure out the right savings plan for your budget.
Here are my top 5 my reasons for choosing a 529 Savings Plan:
1. There are both Federal and State tax benefits when contributing to your plan.
2. You decide how much money you want to contribute and this can be easily changed at any time.
3. No penalty to withdraw as long as the money is going to pay for a secondary education as well as the things that go along with it such as room and board and computer equipment.
4. You are not restricted to your own state’s 529 plan. It’s a competitive market and you get to decide which plan works best for you.
5. It is super easy to set up and you will be soooo glad you did, especially when you get your first college invoice.
If you would like more information on 529 Savings Plans, an advisor at The Retirement Planning Group will be happy to help you out. You may visit our website at www.planningretirements.com for our advisors names, bios and contact information.