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College savings surveys offer insight
by Joe Hurley, founder, Savingforcollege.com
Monday, August 27th 2007

[Updated March 13, 2008]

Savingforcollege.com's online surveys are not scientifically conducted, but are informative nonetheless. A perusal through our past surveys leads to some interesting findings:

Most college savers want their investment to beat tuition inflation. Over 60% said they wanted to maximize their investment returns (with appropriate risk) and hoped to outpace college cost increases. Only 18% are looking to simply match college cost increases, and 16% indicate they do not wish to take on investment risk even if chances are they will not keep up with tuition inflation.

Parents clearly desire sending their children to first-choice colleges. Most of you (82%) would put off your retirement for a couple of years if it meant your child attending the college of his or her choice without taking on more student debt. Only 9% of you would tell your child to find a less expensive school.

Nearly three-quarters (74%) of respondents believe the government will be raising tax rates sooner or later. Tax-free 529s become even more attractive as tax rates go up.

While a decent number of people with 529 accounts (34%) use the in-state 529 plan exclusively, an even greater number (48%) have decided to go out-of-state. Interestingly, 7% of respondents didn't know if the 529 plan they were using was the home state plan or an out-of-state plan.

Most parents feel their children should have a financial stake in their own education. A majority of respondents (58%) said their child should contribute to college costs even if they (the parents) had the resources to pay the entire cost.

The use of 529s for adult education looks promising. Over half of you (52%) think it is "highly likely" you will go back to school (either on campus or online) at some point in your life.

The states face a public relations challenge in their role as plan sponsors and administrators. Most respondents (76%) felt the states should not have the monopoly on offering 529 plans (and 43% said the states should be banned entirely). Only 16% were in support of the state monopoly.

We have many other survey results available for viewing. If you have a suggestion for survey question, please feel free to let us know.

» Should you open an UGMA/UTMA 529? - 02/07/08
» Understanding your state's slice of 529 fees - 12/14/07
» Planning for the new "kiddie tax" - 10/31/07
» College savings surveys offer insight - 08/27/07
» Dealing with the new college-kid tax - 06/25/07
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