Is It Ever Too Late to Save for College?

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Mark Kantrowitz

By Mark Kantrowitz

August 18, 2020

It is never too late to save for college, not even if your child is a high school senior.

The sooner you start saving for college, the better, as it provides more time for your earnings to compound. But, it is never too late to save for college and to take advantage of the benefits of a 529 plan. Saving something is better than not saving anything,.

Every dollar you save is a dollar less you’ll have to borrow. Since every dollar you borrow will cost about two dollars by the time the debt is repaid, saving for college will literally save you money. 

Saving for college also provides your child with the flexibility to choose a more expensive college than you otherwise could afford. 

Even after your child is already enrolled in college, it can be financially worthwhile to save for college. If your state provides a state income tax deduction or tax credit, contributions to the state’s 529 plan can provide a state income tax break even if you immediately take a distribution to pay for college costs. (In four states, the state income tax break is based on contributions net of distributions, so you have to stagger the years in which you make contributions and take distributions.)

Even after your child graduates from college, up to $10,000 per borrower can be taken from a 529 plan to repay the student loans of the beneficiary and the beneficiary’s siblings. (Some states treat student loan repayment as a non-qualified distribution, which could result in state income tax on the earnings part of the distribution.)

Having a 529 plan increases the likelihood that the child will go to college and graduate.

You can grow your savings with Upromise and CollegeBacker. With Upromise, earn cash in your 529 plan by shopping through their platform and dining at participating restaurants. CollegeBacker has a similar shopping platform and also has an option for easily accepting gifts from family and friends.

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At, our goal is to help you make smart decisions about saving and paying for education. Some of the products featured in this article are from our partners, but this doesn’t influence our evaluations. Our opinions are our own.

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