For the leaders of tomorrow, the foundation of a strong financial future begins with higher education. But as we all know, college is expensive. At an average annual increase of 5-9% each year, it will require a small fortune to put your child through college. Federal loans, grants and scholarships account for only a small portion of today’s college costs. The great majority of the financial burden will fall on families.
These costs may come at a difficult time, when parents are anxiously saving for their retirement. With sound financial planning, parents can afford both college for their children and retirement for themselves. The key is developing the right strategy early and sticking with it.
Possible strategies may include:
- 529 College Savings Plans
- UTMA (Uniform Transfer to Minors Act) accounts
- Coverdell Education Savings Accounts
- Retirement plan loans and withdrawals