Education Planning

Expert College Planning Solutions

With our big-picture understanding of the education-funding landscape — from tax-exempt savings products to financial aid processes — we can design a college savings plan that works harder for you and your student.

Tax-Efficient Savings Plans

Our financial experts have access to a broad selection of 529 plans, Education IRAs and other tax-advantaged college savings plans, and can find the one that best fits your timeline and objectives.

Loans

We’ll help you explore the benefits of deferred-interest, tax-advantaged and standard education loan options, and how they can be used to complement your overall saving strategy.

Questions About Education Planning?

FAQ

When should you start planning for college?

Everyone is aware that college costs continue to spiral upward. So, the short answer is, the sooner the better. We have found that preparing for college should ideally start as early as possible, and in conjunction with your other financial objectives. If you started planning late, it’s not a hopeless situation by any stretch. Starting planning later can still help you lessen the impact of sending a child to college.

How does a 529 work?

A 529 is a tax-advantaged investment account that allows contributions to grow tax-free. Some states offer a tax break for the contributions themselves. Distributions from the account are not taxed if the money is used for qualified k-12 or college expenses.

How does an educational IRA work?

An education IRA allows you to save and withdraw funds tax-free when used for educational purposes. These accounts are also referred to as “Coverdell accounts” or education saving accounts (ESA). Even though such accounts informally carry the “IRA” moniker, they are for educational expenses only, not retirement savings.

What’s the difference between an Education Savings Account (ESA) and a 529?

The most significant difference is the way you invest the money. With an ESA, you can choose almost any kind of investment option, including stocks, bonds, and mutual funds. In contrast, 529 plans are state sponsored, so your investment choices are limited to what that state allows. Another difference between the two is that an ESA offers more flexibility and more freedom to customize the account to your risk tolerance; however, with a 529 plan, you can contribute more each year to the account.

How do I know if my family is eligible for federal financial aid?

You will not find out how much financial aid you qualify for until you complete the federal government’s official aid application, the Free Application for Federal Student Aid (also known as the FAFSA). However, the federal government has an online tool, the Federal Student Aid Estimator | Federal Student Aid, which you can use ahead of time to see if your child might qualify for financial aid.

Even if you do not think your family is eligible for federal financial aid, it is important to complete the FAFSA form. By completing the FAFSA, undergraduate and graduate students enrolled at least half-time will be automatically eligible for the federal Direct Unsubsidized Stafford Loan. This low-interest federal student loan is not based on financial need.

How does the Federal Financial Aid process work?

The first step in the federal financial aid process is to complete the Free Application for Federal Student Aid (FAFSA). You will need to provide specific income and asset information for both yourself and your child. The Student Aid Index (SAI) is a numerical calculation based on the information provided on the FAFSA, which determines a student's eligibility for federal financial aid.

The SAI essentially serves the same purpose as the Expected Family Contribution (EFC), which has been replaced by this new formula. It considers factors such as family income, assets, and household size. A lower SAI indicates a greater financial need and generally results in more eligibility for financial aid, while a higher SAI suggests a lesser need for assistance.