While students concentrate on academic preparation for college, much of their parents' focus is on the family's ability to pay for that education. College costs have been rising faster than the rate of inflation; the increase in number of students attending college and requiring financial aid has been putting pressure on the amount of aid available. In the 1980's, scholarships and grants paid around 60% of college expenses. According to the College Board's 2003 report "How the Borrowing Process Works", today 54% of aid awarded is in the form of loans. To avoid taking on considerable amounts of educational debt, students and their families need to look for additional sources of college funds.

Saving and investing a small amount of money each month over time is the best way to be sure that money will be available to pay for your child's education. Gifts from grandparents or other relatives can also be added to a college fund. Some recent tax-law changes have made educational savings plans, such as 529 plans, a very attractive way to save for future expenses. 529 plans allow families to accumulate education-earmarked funds in a federal income tax-deferred account. Contributions of up to $11,000 a year may be covered by the gift-tax exclusion and the money is able to grow both tax-free and tax-exempt when used for qualifying expenses such as tuition, books, and room and board. 529 plan funds may be invested in prepaid tuition programs run by each state for students who will attend college in-state, or in college savings plans that are managed by investment firms.

College savings plans provide more flexibility in type of investments available and allow students to attend schools throughout the country. When families apply for financial aid, current income, rather than savings, counts most in determining expected family contribution, so saving for college will not seriously hamper your eligibility for financial aid. Speak to your tax or financial advisor about the best type of savings plan for your family and get more information about savings options on the web at www.collegesavings.org and at www.savingforcollege.com.

College Counseling Information Links
College Counseling Main Page
Finding A College
Using the Internet to Find Money for College

College Counseling Contacts
Rebecca (Becky) Day
Director of College Counseling
Chaz Prosser
Registrar and Assistant Director of College Counseling
Robbie Angell
Assistant to the Director of College Counseling