Today is the day to celebrate college savings and the investments that you are making in your family’s education!
If you have not been saving or still have years left until the education need, 529 plans can be a tax effective way to fund college. The average student loan debt for the class of 2018 graduates was $37,172 and data provided by the Federal Reserve show that Americans owe more than $1.59 trillion in student loans. That’s about $570 million more than the amount Americans owe in credit card debt!
Another school year is coming to a close and your child is one step closer to going to college. It is a wonderful time of year to talk with your personal financial planner about education planning and college savings.
Not all state 529 education savings plans are alike and you are not limited to your state sponsored plan. Some state plans can be loaded with brokerage commissions, administration fees and high investment fees that exceed 1%. Don’t let this be a burden on the accounts performance. Please do not hesitate to reach out to our resident expert in 529 education savings plans, Bobby Wolfe, if you would like to gain a better understanding of different 529 education savings plans that are available to you.
Little Known Fact
Did you know that in 1986 Governor of Michigan James J. Blanchard proposed the idea of state-sponsored prepaid tuition programs?
At the time, the average annual tuition of public university in Michigan was $1,700. Today the average annual tuition of public university in Michigan is $13,988. It took until 1996 for 529 state-sponsored college savings vehicles to take effect and not until 2001 for the earnings in 529 education savings plans to be completely tax-free when used for college education.
DATA PROVIDED BY: https://www.federalreserve.gov/releases/g19/current/default.htm
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