The average cost of public, as well as private, education is rising rapidly. According to surveys, the cost of public education has gone up by 40 %. Looking at these trends, it can be safely concluded that the cost of education will continue to rise. Therefore, it has become imperative for students and their families to take appropriate measures to deal with this scenario at an early stage. To help people plan for their children’s future education expenses, college savings plans are available.
College savings plans allow families, guardians and other well wishers to set up funds for the sole purpose of their future education. These plans also provide tax benefits along with the option of investing money for long-term growth. The funds are under the control of the contributors or donors until the children reach the age when they are ready to pursue a college education. College savings plans ascertain that these funds are exclusively used for higher education-related expenses. However, it is necessary to make regular contributions after setting up a college savings account to ensure that students are able to cope with the significant costs pertaining to a college education.
To choose an appropriate college savings plan, research of various available plans is mandatory. The major factors to consider when choosing a plan are individual investment strategies, tax benefits obtained and other related reasons, as there are several unique options available. However, it is recommended to put the beneficiaries’ advantages in the forefront when considering any option.
Mostly, state governments offer plans with benefits that other plans may not be able to offer. To find out about these state offered plans, as well as national college savings plans, people can visit their respective websites. These official websites offer easy access to relevant information that makes it easier for donors to choose a plan. The option of consulting a financial advisor before opening a college savings account is also available for donors.
Source by Eric Morris