Lessons in Education Funding
By Evans Attwell
Senior Vice President
Frost Private Banking
Another school year is beginning, an unmistakable reminder that if you have school-age children or grandchildren, they have grown another year closer to college. No doubt, you want to give them every opportunity in life, and if you’re like many people, you believe that a college education is the gateway to those opportunities.
A recent College Board study confirmed that belief, reporting that Americans with a college degree earn as much as $1 million more during their lifetime than those with only a high school diploma.
But this advantage doesn’t come cheap. Between 2011-12 and 2016-17, published college tuition and fee prices rose between 9 percent and 13 percent, after adjusting for inflation, outpacing average increases in personal income.
Despite harsh economic realities, saving enough for college costs is possible, say financial experts, but families must do their homework first. Three “lessons” lay the groundwork for achieving this goal.
Start early
Every year you postpone education planning and saving, you could be limiting your child’s options. They may not be able to attend the school they has their heart set on, or you—or your child—may have to take on substantial debt to pay college costs. Still, you can do something significant in terms of saving and investing for college, especially if you start early and use compounding to your advantage.
Focus on an attainable goal
Instead of worrying about the unknown, get clarity about your goal by defining what you want—and are able—to fund. How long do you have before your child is ready for college? Do you want to fund 100 percent of costs or a smaller percent? Consider additional factors, such as other children in the family, your own retirement planning, and possible financial help from grandparents.
Get professional help
With so much at stake, the most effective planning requires someone who knows the right questions to ask and understands the wide range of funding options—from tax-advantaged saving and investing to scholarships, grants and other financial aid—available to you. A financial professional can work with you to uncover issues and resources you may not have considered and help you define a clear-cut education goal and a plan to achieve it that fits your individual needs.
Would you like more information?
Contact Evans at 713.388.1367 or
evans.attwell@frostbank.com.