Wednesday, February 23, 2011

College Education: Parents Paying vs. Student

Currently there are many options out there for parents hoping to save for their child's college education. There are 529 plans, Coverdell education savings accounts, prepaid tuition plans, and sometimes US Savings Bonds are some of the ones I found doing some quick research on the internet. Each plan has advantages and some disadvantages.

Then there is the option of your child paying for their own education costs. This is how I made it through college and how both of my older siblings made it through school as well. If my parents had been able to help me, they would have but it was not a financial possibility when I went to college.

I, personally, think if I can help my children pay for college I will. My husband agrees with me, but many people out there think their children should do it on their own. So, chime in and let us hear what you think!


Alyssa Harper said...

My parents had a college "fund" for each of the kids. We'd do chores and things around the house and my dad's business and gradually built up funds in our college accounts. I seem to remember my parents saying that the "funneling" of funds was tax deductible...but I can't say for sure. Anyhow. It wasn't an extravagent sum, but I from it, I always felt a sort of expectation to go to college and that my parents felt education was important. And I certainly appreciated it during my first year (that's all it lasted) when I was still figuring out how finances worked when living on my own.

Heather said...

I paid for my own schooling (with the exception of rent one month during my freshman year) by working my way through college, scholarships, and Pell grants and I'm very proud that I could do that.

HOWEVER, tuition keeps going up every year and government aid and scholarships continue to be cut as money gets tighter and tighter. I'm a little nervous that by the time my kids get to college, they won't be able to afford it.

Though we haven't done anything yet, I'd love to learn some ideas that others have done to contribute to a college fund and how it has worked for them.

Rebecca said...
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Rebecca said...

My parents helped pay for 1/2 of my college expenses for the first 2 years and then I paid for it all after that. Same with my husband. I feel like I learned a lot by having to pay for most of my schooling but it would've been nice not having to work full-time and go to school full-time.

I plan on helping my children pay for college. I am very passionate about education and I don't want money to be a reason for them to not go. I would want my children to have to take care of some expenses such as groceries and clothes though so they do learn how to take care of their own finances.

We have opened a 529 plan for our daughter. I highly recommend them. Utah has one of the best 529 plans in the country (since they vary by state). Low fees, it grows tax-free, tax credits, and has many options to choose from.

Tannie Datwyler said...

Right now we just have a savings account set up for each of our children. I plan on letting them do what they will with the money - it's just our little gift to them. Maybe the boys will use it on missions, maybe if any of them get scholarships they'll use the money to buy a house in the future - who knows? All I know is that we wanted to do something financially for our children.

I'd LOVE to hear about the 529 plan - I've never heard about it before. Can someone explain or give a good link that explains?

Rebecca said... is the link for Utah's 529 plan.

If you go to Plan Basics and then on the right hand side there's a link to a more detailed description about it. If you have any questions about it or not sure which option to choose let me know I'd love to help!