Get a Head Start in Saving for Higher Education

Pamela Boisvert

Worcester has a rich tradition of higher education, innovation, and perseverance, being the home to nine colleges and universities. At MassEdCO, we are proud to be part of another education tradition – that of assisting individuals and families on their journey towards academic and professional success.

We have seen first-hand how making a plan for higher education can make dreams come true, and we are excited to assist the next generation of professional and civic leaders in creating their plans for future success.

Families are well aware that higher education is important to their child’s success. According to a 2015 Sallie Mae Report, “How America Saves for College,” nine in ten families believe that higher education is an important investment in their child’s future. But despite this universal belief, less than half of families with children under the age of 18 reported saving for college. One reason might be that many families don’t know where to begin, or how to make a plan to save. The report showed that 20% of families who are currently saving often felt overwhelmed about how to continue it year after year, a feeling that was even higher (38%) in families who weren’t saving at all.

The costs of higher education can be daunting at first glance, but that’s why it pays to plan early. As partners of Treasurer Goldberg’s SeedMA program, we at MassEdCO are working to help families develop a roadmap to pay for their children’s higher education as they begin kindergarten this fall and start their education journey. We know that saving for higher education is a new experience for many of these families, which is why we are pleased to join the Massachusetts Educational Financing Authority (MEFA) and Treasurer Goldberg’s Office of Economic Empowerment in not only setting up their children’s college saving accounts but also providing guidance and tips at every step along the way.

The first step toward ensuring a kindergartner’s future education options is to open a 529 college savings account through the SeedMA program. According to the Sallie Mae report referenced above, unfortunately just over a quarter of all families currently saving for college reported using these tax-advantaged accounts to save. Yet these accounts are proven to increase educational attainment: just opening one makes children 7 times more likely to attend college (SeedMA Fact Sheet 2016).

The second tip families can act upon is to not panic! While the sticker price of higher education may seem unattainable, families are rarely expected to pay the entire cost. The SeedMA program provides families with strategies about loans, scholarships, work-study, and other opportunities to help keep education costs down. It’s important for families to remember that even small amounts have a positive impact on their child’s likelihood of attending college: children who have just $500 or less saved for college are 3 times more likely to enroll, and 4 times more likely to graduate from college (Assets and Education Initiative 2013).

Beginning with this year’s class of kindergartners, Worcester families can get a head start in saving for higher education much earlier than the typical family does. By being there for Worcester families, we can all do our part to assist in making a plan and creating a success story for each and every child.