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July Goal: Plan for College

July Goal: Plan for College

| August 01, 2018

July Goal: Plan for College

Katherine Nithman CFP®, RFC®, CWS®, CRC®, AIF® | August 1, 2018

 Did you know that…

  • On average, an American worker with a Bachelor’s degree earns nearly $30,000 more per year than if he or she had a high school diploma alone?1
  •  A study from the University of Maine shows that college graduates live happier, healthier lives? 2
  •  The average tuition costs for a public four year in-state university is $9,528 ($21,632 for out-of-state students at state schools), and $34,699 for a private four year university?
  •  In-state tuition prices among public National Universitiesgrew by 65 percent over a 10-year period from 2007-2008? 3

 With the merits and costs of education in mind, what investing strategies can help meet your loved one’s college funding goals? What strategies have the potential to minimize your tax implications?

 Understanding possible future costs and saving as early as possible and are key to a successful college savings strategy.

 There are a number of ways to assist in paying for a loved one’s education. Options Include:

  • Contributing to a 529 education savings plan
  • Contributing to a Coverdell education savings account
  • Giving through the Uniform Gifts to Minors Act  (UGMA) or Uniform Transfers to Minors Act  (UTMA)
  • Making direct tuition payments to a college or university
  • Directly gifting cash

 Keep in mind that if done incorrectly, monetary gifts can adversely impact your grandchild’s ability to qualify for financial aid, which in turn may diminish the value of your gift. "A gift from the grandparent to the parent is not reported as income on the FAFSA [Free Application for Federal Student Aid]," says Mark Kantrowitz, publisher and vice president of strategy at, a college and scholarship search website. To maximize a student’s opportunity to receive financial aid, it is more advantageous for the grandparent to give a financial gift to the parents, who can in turn use it to pay for college expenses. 4

 Tax-advantaged strategies are also available to give grandparents the opportunity to help grandchildren pay down or pay off student loan debt. According to, the gift tax exclusion enables grandparents to gift up to $15,000 a year to a single beneficiary, and $30,000 if grandparents are married and filing jointly. However, other estate planning strategies allow you to gift far more in a highly tax-efficient manner.

 Don’t delay! Time is money! Start investing and planning for college expenses today.

 For more information on helping a child or grandchild reach his or her goal of a college education, call us today at 405-767-1230. We would love to be a part of the plan to achieve the dreams of your family.

 1 2015 Census Bureau, Current Population Survey

 Want to Be Happier and Healthier? Then Go to College by Jamie Merisotis. October 15, 2015, Updated Oct 15, 2016, published on

 3 What You Need to Know About College Tuition Costs by Farran Powell. March 28, 2018, published on

 4What Grandparents Should Know About Paying for College by Farran Powell. Nov. 2, 2016