How to save for your child’s college

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College can be one of the most expensive “purchases” in your family’s life, which can cause a lot of questions on how to prepare. Good thing for most parents, there are many options to save for college expenses. Some parents prefer to save for their child’s education with some kind of transaction account, such as a savings account. However, this is not your only option.

A great way to save is a 529-college savings plan, which allows parents to invest after-tax money into diversified, low-cost stock and bond funds. When parents are ready to pay for qualified education expenses, they can then withdraw the money tax-free.

For parents who are confident that their child will attend an in-state public university, a prepaid tuition plan is a good alternative to a 529 savings plan. This plan allows parents to pay for tuition credits in advance, at a predetermined price. Other options include: UTMA and UGMA accounts, Coverdell Education Savings Account, taxable investment account and a Roth IRA. 

For more information visit dartbank.com or any of our local banking offices. Member FDIC.

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