Ways to Pay for Post High School Education

Pay For Post HS PDF

Parents don’t always consider how they will handle education expenses until their first child is in high school. That is not always a good idea. And even though not every child will go to college, most kids will have some type of post high school education expenses. Parents should start thinking about this early and focus on the 529 plan as well as other ways of paying for post-high education expenses.

How should one begin planning for financing post-secondary education?
Start by focusing on a few important considerations. How much do you want to pay for any post high school education expenses that can include technical training, trade schools, or college? The amount you need to save is the starting point and the next consideration is where do you want to save these funds? Flexibility in your savings option is critical to avoid paying penalties later and in maximizing your contributions.

What are the methods people use to pay for post-high school education?
Most people use a combination of methods to pay for college. The list includes using funds from a 529 savings plan, scholarships, student or parent education loans, other loans, other savings options, student work, and even from parents’ monthly income if there are monthly payment plans. As a parent, it is important to remember that there are a variety of methods to help children either attend a trade school or college. An important early move is to help your child become stronger academically. Merit based scholarships can become an important source of funding.

Why is the 529 plan an important part of educational funding for many families?
Tax friendliness is one of the primary reasons that 529 plans can be powerful. The earnings in these accounts grow tax free and for some states, contributions can lead to a state tax deduction. These accounts are very easy to open and maintain. Furthermore, parents remain in control of the funds, not the beneficiary. Withdrawals are tax free if they are used for qualified expenses from eligible college and vocational schools. Indiana’s College Choice Savings plan is one of many 529 plans that offer flexibility.

How should parents navigate saving for post high school education?
Begin with adjusting your budget to have the funds to start saving for post high school education. Talk to your kids early on in high school to help set realistic expectations for their post high school education. It is always best if your kids understand how much you can afford so they can plan for how much in student loan debt they might need if they pick an expensive option. Finally, you don’t have to have it all saved. Save as much as you can and as your children go through post-high education you will have other sources you can use. Most importantly, don’t derail your retirement savings to fund college savings.