How to save for education

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?

529 plans

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

  • Your contributions to the plan are made with after-tax income, however your gains are not subject to federal tax
  • Money you take out to pay for qualified education expenses is exempt from federal taxes
  • Some states also offer tax incentives for savings
  • You can contribute to a 529 plan regardless of how much you earn – there is no upper income limit for tax-advantaged education savings
  • If there are funds left over in the account after paying for one family member’s education, the remainder can be used to pay for qualified educational expenses of another family member

Additional sources of funding

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.

Asset secured financing

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.

Using the equity in your home

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.

Disclosures
Start of disclosure content
  1. The prospectus explains the details of the sales charges, expenses, management fees and available discounts (sometimes called breakpoints or price breaks). These may or may not be applicable to the purchase being made.

Start of disclosure content

Investment and insurance products and services including annuities are:
Not a deposit ● Not FDIC insured ● May lose value ● Not bank guaranteed ● Not insured by any federal government agency.

U.S. Wealth Management – U.S. Bank | U.S. Bancorp Investments is the marketing logo for U.S. Bank and its affiliate U.S. Bancorp Investments.

Start of disclosure content

U.S. Bank, U.S. Bancorp Investments and their representatives do not provide tax or legal advice. Each individual's tax and financial situation is unique. You should consult your tax and/or legal advisor for advice and information concerning your particular situation.

The information provided represents the opinion of U.S. Bank and U.S. Bancorp Investments and is not intended to be a forecast of future events or guarantee of future results. It is not intended to provide specific investment advice and should not be construed as an offering of securities or recommendation to invest. Not for use as a primary basis of investment decisions. Not to be construed to meet the needs of any particular investor. Not a representation or solicitation or an offer to sell/buy any security. Investors should consult with their investment professional for advice concerning their particular situation.

Start of disclosure content

For U.S. Bank:

Equal Housing Lender. Deposit products are offered by U.S. Bank National Association. Member FDIC. Mortgage, Home Equity and Credit products are offered by U.S. Bank National Association. Loan approval is subject to credit approval and program guidelines. Not all loan programs are available in all states for all loan amounts. Interest rates and program terms are subject to change without notice.

U.S. Bank is not responsible for and does not guarantee the products, services or performance of U.S. Bancorp Investments, Inc.

U.S. Bank does not offer insurance products. Insurance products are available through our affiliate U.S. Bancorp Investments.

Start of disclosure content

For U.S. Bancorp Investments:

Investment and insurance products and services including annuities are available through U.S. Bancorp Investments, the marketing name for U.S. Bancorp Investments, Inc., member FINRA and SIPC, an investment adviser and a brokerage subsidiary of U.S. Bancorp and affiliate of U.S. Bank.

U.S. Bancorp Investments is registered with the Securities and Exchange Commission as both a broker-dealer and an investment adviser. To understand how brokerage and investment advisory services and fees differ, the Client Relationship Summary and Regulation Best Interest Disclosure are available for you to review.

Insurance products are available through various affiliated non-bank insurance agencies, which are U.S. Bancorp subsidiaries. Products may not be available in all states. CA Insurance License #0E24641.

Pursuant to the Securities Exchange Act of 1934, U.S. Bancorp Investments must provide clients with certain financial information. The U.S. Bancorp Investments Statement of Financial Condition is available for you to review, print and download.

The Financial Industry Regulatory Authority (FINRA) Rule 2267 provides for BrokerCheck to allow investors to learn about the professional background, business practices, and conduct of FINRA member firms or their brokers. To request such information, contact FINRA toll-free at 1-800‐289‐9999 or via https://brokercheck.finra.org. An investor brochure describing BrokerCheck is also available through FINRA.

U.S. Bancorp Investments Order Processing Information.

Municipal Securities Education and Protection– U.S. Bancorp Investments is registered with the U.S. Securities and Exchange Commission and the Municipal Securities Rulemaking Board (MSRB). An investor brochure that describes the protections that may be provided to you by the MSRB rules and how to file a complaint with an appropriate regulatory authority is available to you on the MSRB website at www.msrb.org.