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Most recent posting below. See other articles in the column to the right.

Stock Up on College Funding Advice

(ARA) - Back-to-school shopping season means big sales for retailers selling pencils, backpacks, clothes and tech gadgets. Young parents know that as children get older, their back-to-school list grows with them. Eventually for many, that list will grow to include dorm necessities, textbooks and yes, college tuition.

Parents, if blunt scissors and crayons are still on your child’s school supply list, now could be the right time to start planning your college funding strategy. Patrick Egan, national retirement spokesperson for Thrivent Financial for Lutherans offers this list of “school supplies” to help you and your student, prepare for college.

529 plan

529 plans are a tax-deferred way for anyone to invest in a child’s education. These accounts are controlled by your state or by a manager your state has appointed. Anyone can establish a 529 savings plan naming anyone as a beneficiary. Investments may be used at any approved private or public school. Earnings in this account are tax-deferred until withdrawn, and distributions to pay for qualified higher education expenses are exempt from federal and sometimes state income taxes. Check with a financial professional in your area to find out how a 529 plan in your state could be helpful to your college funding strategy.

Custodial account

This type of savings account allows you to build savings for any child. This means grandparents, relatives and friends could also set this up. While the child’s name is on the account, the adult custodian is responsible for overseeing it until the child turns the age of majority, usually 18 or 21. Once the child assumes control of the custodial account it can be used for any reason, meaning that if your savings exceeds the amount needed for tuition, your child could use it for living expenses or save it for something else.

Coverdell accounts

The savings accrued in a Coverdell account can be used for approved expenses before your child goes to college, on K-12 expenses for students in private or public schools, as well as eligible post-secondary education expenses. A child can receive up to $2,000 in annual contributions to a Coverdell account until age 18.

Other types of accounts:


Contact an attorney to see if a trust could be right for you. Trusts can be used for education and other purposes and contributions to a trust have no minimum or maximum amount so saving can be done in many different ways.


While traditionally used for retirement savings, traditional and Roth IRAs allow you to withdraw funds penalty-free if used for qualified education expenses. Your contributions may be tax-deductible and grow tax-deferred until withdrawal. Contact a financial representative about using IRAs for college funding, as this could affect your retirement strategy and financial aid eligibility.

Permanent life insurance

If something should happen to you, a permanent life insurance contract can help ensure that goals like education can be met, even if the unthinkable happens. In addition, permanent life insurance contracts accumulate cash value that can be used during your lifetime and also provide additional flexibility for other funding avenues as well. Visit for more information on types of life insurance to help you pay for college.


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