You have options when it comes to covering educational expenses for yourself, your kids, or others you care about. The sooner you start planning for elementary, secondary, college, or graduate school expenses, the better prepared you’ll be.
Your plan starts with identifying your education savings goals and timeframe. Would you like to cover your child’s or grandchild’s college expenses so they can graduate debt free, or do you expect them to pay for a portion of the cost? What are your potential sources of funding? How much time do you have to build education savings?
If you have time to plan in advance, consider education savings plans that offer tax benefits. A 529 Education Savings Plan is one of the best ways to put aside funds to pay for education expenses from primary school through college.
A 529 plan by U.S. Bancorp Investments can give you a tax-advantaged education savings account that can be used to pay for elementary and high school expenses, as well as college or university costs.
529 plans are invested using a strategy that typically utilizes mutual funds. All mutual funds have fees and expenses. It is important to understand the transaction costs associated with buying or selling shares of a fund, as well as the annual costs associated with operating the mutual fund because both affect the return on your investment.1
If your timeframe is short, your first step is to look into federal student loans, grants, and private student loans. Evaluate the amount of funding you’re likely to receive compared with the estimated cost of education to see how much more you will need to cover expenses.
Liquid asset secured financing is a flexible line of credit offered by U.S. Bank that is secured by assets in your investment portfolio. One of our financial advisors or bankers can help you determine if this type of financing may be right for you.
If you own a home, you may want to consider getting a home equity loan or line of credit from U.S. Bank to cover any gap. In some cases borrowing against the value of your home may be a lower cost option than taking out a private education loan.