University of Virginia

Top 5 Reasons to Have a College Funding Plan

You’ve been saving money for college since the day your child was born. You’ve got a tidy bucket of cash in a 529 plan. Now your little one is a rising junior, and it’s time to plan for her or his college career.

What’s your plan?

If you think that, given your income and/or assets, that you’ll just have to write a check, you’re making a mistake. Would you pay sticker price for a car? Why would you pay sticker price for a college education?

Here are the top 5 reasons to have a college funding plan:

1.    You can pay for college with pre-tax dollars.

  • By taking advantage of often overlooked portions of the tax code, your family can create “tax scholarships.”  A tax scholarship is any new found tax deduction that creates money you can use to reduce the cost of college. In essence, you can have the IRS pay a big piece of your college expenses.

2.    You can get tuition discounts from schools, even if you don’t qualify for need-based aid.

  • If your child is a great fit for a school, that college or university will want your child to attend. Use that to your financial advantage and negotiate with the school, ask about discounts and grant programs that can reduce the sticker price of tuition.

3.    You can send your child to a top school for the same price as a small state college.

  • Using tax scholarships, tuition discounts, merit-based aid, grants, and your negotiating skills, you can reduce the cost of an expensive private university to less than a state school.

4.    You can achieve your family’s educational goals without sacrificing your values.

  • Help your child get a great education without putting yourself in debt, or sacrificing your retirement goals. Demonstrate financial responsibility in service of a life goal.

5.    Your child learns the value of planning, and participates in charting his or her own future.

  • Your college-bound child can learn valuable life lessons by leading the charge on discovering private scholarships, learning how to assess their interests and skills to find the right college fit, and becoming the project lead on one of life’s most important projects.

Work with your college-bound student to help get him, or her, off to a great start on a meaningful education, and career. It’s all in the planning!