Another September is here, and that means another College Savings Month! This month is a time where 529 plans around the country commemorate college savings and recognize the importance of starting while kids are young. In that spirit, we’re kicking off our celebration with some reminders of why saving for college is so important:
1) Reduce the need for student loans.
With student loan debt now at an average of $30,000 per borrower, and with total nationwide student loan debt surpassing $1 trillion, it’s more important than ever to save now to avoid borrowing later.
2) Expand your child’s college choices.
Your college savings have the potential to expand your child’s college choices. If an Ivy League school comes calling, wouldn’t it be great to tell your student “We’re so excited to support you in this opportunity,” rather than “We wish we afford this opportunity.”
3) Create a college-bound culture for your family.
Studies show that children who have college savings accounts in their name and know it are seven times more likely to do well in school and go on to college. Plus, setting this precedent for your children may lead them to do the same when they start their own families.
4) Reduce stress.
Your savings efforts will pay off in peace of mind. You and your children will be able to focus on “where” they want to go to school instead of “if” they can even go.
5) Create financial literacy learning opportunities for your kids.
Use your thoughtful planning and saving as a tool to teach your kids about the importance of being prepared, managing finances and the time value of money.
6) It makes a great gift.
The gift of college tuition is one that will keep giving for a lifetime by giving your child access to academic and personal growth opportunities as well as expanded employment options.
7) Improve your children’s long-term financial security.
Without the burden of tens of thousands of dollars of student loan debt, your children will be better set up for their own economic prosperity – the ability to purchase a home, start putting away for retirement and of course, start saving for their own kids’ college education.
8) Pay less for college costs.
By saving while kids are young, you’ll give your money the opportunity to work for you and grow in value. Pair that with the reduced need to borrow money, and the total college bill will set you back significantly less.
9) Keep your household expenses in check.
By committing to saving, you’re simultaneously making a commitment to reduce your spending. You’ll be amazed to find how much money slips out the back door when you’re not looking.
10) Ensure your nest stays empty in the future.
By setting your kids’ up with the tools they need to be marketable in the business-world and by helping them achieve financial independence by reducing the need for loans, you’ll get a chance to enjoy one of the best benefits of saving for college. Just think about how nice it will be to have your space back and your pantry full.
These are just a few of the many great reasons to save for college while your kids are young. The most important thing to remember is to not let the prospect of how much college may cost in the future be overwhelming or discourage you from getting started. A dollar saved today is a dollar (or more) you won’t have to borrow down the road. Beyond that, when you make an investment in your children’s futures, you are setting them up for a lifetime of opportunity!