Affording higher education

Education beyond high school usually has a high price tag. Starting to save early is a great first step to making it affordable.

AliciaThere are lots of benefits for students who pursue education beyond high school. From a purely financial point of view, the level of education a person achieves can make a huge difference in their future earning power.

CassieAbsolutely. On average, a college graduate earns over $1 million more in their lifetime than a high school graduate, and that gap is growing.

AliciaBut whatever your child’s goals may be — whether it’s a four-year college, junior college, technical training or trade school — education after high school usually has a high price tag.

CassieThe amount of money you’ll need will depend on a variety factors: the school you choose, whether it’s public or private, whether it’s a 2-year or 4-year program, and whether your child is going to be living at home or at school. The costs can vary significantly. But it makes sense to start saving as much as you can as soon as you can.

CassieThe U.S. government has created two special programs for adults to set aside savings for their children or grandchildren’s education. Most financial institutions across the country offer these programs. The first program is called an Education Savings Account. The second program — a 529 Plan — offers two basic types of plans.

Remember these key points:

  • Education = Earning power
  • College degree = $1 million+
  • School costs vary
  • Start saving early!
  • Two government programs: Education Savings Account and 529 Plan (two types)

 
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