Before college

 
Ready to get a head start on saving for college? Here are five strategies to help keep you on the right track.

Understand college costs

Think college is too high-priced? Calculating the cost of college depends on which school you choose and how much financial aid you'll receive. Tuition and fees take the lion's share of your income, with annual costs rising 6%—more than twice the rate of inflation. Start comparing public, private, community and in- and out-of-state schools to get a ballpark figure on cost. Then you can start to estimate how much you need to invest based on your timeframe and budget.
The average price for one year of college
Source: "Trends in College Pricing 2017," College Board, collegeboard.org
Before you go into sticker shock, here's good news: Many families rely on a number of sources to help pay for college.
View the Paying for College infographic to see how they typically do it.

Tip: Ask friends and family to get involved

Instead of giving a traditional gift, grandparents, relatives and friends can contribute to a child's college investing account on holidays, birthdays and special occasions. You can even get your children involved in saving by contributing a portion of their allowance or job earnings toward their future.

Start saving now

With college costs on the rise, saving now can pay off later. That's because starting early allows more time and opportunity for your investments to grow—and can reduce the amount you have to borrow. Setting aside even a little can make a big difference in helping you meet the future cost of college. Remember, it's never too soon or too late to start saving. Every dollar saved is one less you may need to repay with interest.
Our professionals offer a few simple steps that could help you on the road to funding what is often one of life's most important priorities. Tip #1: It's never too early to start.

Tip: Put your savings on autopilot

Make contributions directly into your savings or investment account with automated bank transfers or payroll deductions so you never have to worry about missing a payment.

Explore 529 plans and custodial accounts

Whether you're investing for a child, grandchild, family member or even yourself, you can find the right account to pursue your college planning goals.

529 College Savings
Plans

A tax-advantaged investment plan operated by each state with high contribution limits to help you pay for college expenses

Custodial Accounts (UGMA/UTMA)

A taxable account opened on a child's behalf that can be used for education or any expense that benefits that child

Balance college savings with other life priorities

Investing in your child's education is a goal that should be set with other life priorities, like retirement. Instead of tapping into your nest egg to cover tuition costs, consider all funding sources to avoid jeopardizing your own financial health.
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Financial Solutions Advisor™, who
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and plan for what matters most to you.
Please remember there's always the potential of losing money when you invest in securities. Before you invest in a Section 529 plan, request the plan's official statement from your Financial Solutions Advisor and read it carefully. The official statement contains more complete information, including investment objectives, charges, expenses and risks of investing in the 529 plan, which you should consider carefully before investing. You should also consider whether your home state or your beneficiary's home state offers any state tax or other state benefits such as financial aid, scholarship funds and protection against creditors that are only available for investments in such state's 529 plan. Section 529 plans are not guaranteed by any state or federal agency.

Neither Merrill Lynch nor any of its affiliates or financial advisors provide legal, tax or accounting advice. You should consult your legal and/or tax advisors before making any financial decisions.
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