Tips to Make Paying for College Easy

Helping pay for College with College Loans

According to, college tuition is up 24% from 10 years ago and 66% from 20 years ago. And it’s the fundamental reason that paying for college as soon as possible is so important.

For college students it means less money to pay back in student loans once you’re out and on your own. For parents, it means more energy can be focused on your retirement plan rather than helping your children manage their debts once they’re out of school.

The simple fact is: Start saving early and save often.

2 Ways to Save

The 2 best ways to start saving are through a savings account and through 529 college savings plans.

A savings account is easy to start and it allows you flexibility in accessing the money if needed.

529 plans are specifically built to fund educational expenses. Contributions are tax deductible and withdrawing the money for educational expenses are tax free.

And nowadays, most 529s can be used to fund colleges outside the state’s the plans are in. For example, just because you are in the Oregon 529, you can still use the money if you decide to go to a college that’s out of state. We have also set up our own Central Willamette Educational IRA to help as well.

And given the annual contribution limits put on some plans, you can also buy into other state’s 529s that may have better performance and will help your money grow faster. Just make sure all the plans you’re in allow you the flexibility of spending your plan savings on the colleges you want to go to.

Savings and 529 Balance

One thing to keep at the top of your priority list when you start your college savings strategy is to make sure you understand the value of growth in your plan.

With college costs continuing to rise much faster than inflation, money that’s in a savings account or Certificates of Deposit (CD) may keep the money safe, but it’s growth may barely keep up with inflation as the years tick by.

Because 529s are invested in stocks and bonds, there’s greater risk, but also greater reward.

You’re not trying to turn a 529 into a high-rolling portfolio, but the power of compounding can help accelerate the growth of your contributions.

Finding the right balance between savings or CDs and 529 plans can go a long way to help make paying for college far less intimidating than it appears.

And if you need some help to strike that balance, our financial team will be happy to sit down with you to get you started on the right track.

If you like this article and want to read more about planning for life's major milestones, check these out:

Saving for College

Saving vs Investing

And always remember, we are here to serve you. Whether it’s with our retirement calculator or by getting you in touch with one of our hand-picked investment advisors.