Click Here to read an article from Forbes that I believe you will find of interest. As always, I welcome your comments and/or questions.
Barbara A. Culver
CFP®, ChFC®, CLU, AEP®
529 college savings plans are often thought to be the most effective way to save for college education expenses. Contributions to these plans can be deducted from state income tax, grow federal and state tax-free, and can even be withdrawn tax-free for the use of higher education expenses, such as tuition, room and board, books and other similar costs. With the increasing amount of 529 plans, some are finding that a portion of the plan balance may not be needed, in fact, for college expenses.
Due to the variability in college expenses, planning for the precise amount can be difficult. There are so many factors that affect college expenses. In-state versus out-of-state tuition costs vary, as do public versus private institution costs. Future tuition inflation levels and scholarships also can greatly affect a student’s college expenses. Unlike some other child savings avenues, 529 plans give account owners control. 529 plans also provide ways to divert and divest the surplus or unused amount in the plan. Some options account owners have are:Read More
The new school year has begun! Besides a new school year, fall also rings in another sports season for many families. I have an 8-year old son, and for the first time, he will be playing tackle football. I still don’t know how I feel about that!
He also plays fall soccer for a club team, winter basketball for his school, spring baseball with his school, and another round of club soccer in the spring. He plays these sports out of passion for the game and being a “Energizer” bunny full of athleticism.
While he may play a lot of sports, I always instill that school comes first and if he starts to struggle in school, the sports schedule will be fiercely re-evaluated.
I tell you all of this because at 8 years old, I am already hearing other parents and coaches tell me that he could be a candidate for athletic scholarships for college. First, I am by no means taking any of that to heart. He is 8 years old and has many moons before college. Second, it triggered this blog post, because I had an article from Wealthmanagement.com magazine titled “How to Get an Athletic Scholarship”, written by Lynn O’Shaughnessy.
I found the article very interesting because as financial planners, we do a lot of education projections and creating strategies for families to afford not only college, but in some cases, elementary and high school educations. Through our experience with the education planning, we run across parents who are “counting on” athletic scholarships to pave the financial way for their children to attend college.
The reality may be different from what many parents anticipate.
The article pointed out that the odds of receiving an athletic scholarship are very small; “2% of high school athletes receive a sports scholarship at a National Collegiate Athletic Association (NCAA) school”. The article further points out that the scholarships tend to be less generous than the financial aid or merit scholarships that students can receive.
It was an interesting read and pointed out a couple of other college funding options for athletes – focus on merit scholarships and financial aid. If you have a student who wants to get noticed by college coaches, have them utilize an online recruiting service (Next College Student Athlete (NCSA) or BeRecruited). The students can also reach out to college coaches to introduce themselves and follow up with the coaches. Another resource for students and parents would be the ScholarshipStats.com website. This site is a source for athletic scholarship statistics to research specific sports and individual schools.
When it comes to financial planning for your children’s education, putting too many hopes onto an athletic scholarship is not advisable. Let’s talk through all the options that your children will have for college and beyond.