The Best Way to Help a Grandchild With College
A college education — even at a highly rated private institution — was once regarded as a relatively affordable route to lifelong prosperity, but in recent years it has become a hobbling financial burden for many families. As a result, older generations are often stepping up to help their families with college funding. According to a Fidelity Investments survey of its investors — a more affluent group than the average — more than half of grandparents “are saving or plan to start saving to help pay for college costs.” The desire for one generation to help another with college has become more urgent in recent years. According to the College Board, private colleges averaged more than $40,000 in total expenses for the most recent academic year; state schools averaged around $17,000 for in-state students. More than 50 top-tier private colleges now charge more than $60,000 a year, including Columbia, Duke, and Stanford. One of the best vehicles for multigenerational college funding is a 529 college savings plan. Offered by states and managed by large mutual fund companies, these plans allow investment for future educational expenses, and the proceeds accumulate tax-free. Many states also provide a tax write-off for at least a portion of a contribution.
Source/more: New York Times
David Wingate is an elder law attorney at the Elder Law Office of David Wingate, LLC. The elder law office services clients with powers of attorneys, living wills, Wills, Trusts, Medicaid and asset protection. The Elder