Monument Resource Center
Our clients hire us because they recognize the value of our Team’s unique, straight-forward, unfiltered opinion and our tailored advice designed to answer their questions, not everyone else’s. Below, you’ll find some of the most important questions we have been asked over the years to help you better understand the role we play and the advice we give.
When it comes to actually paying the bill for your child to go to college, there’s an option that schools don’t advertise. In fact, you’re probably going to have to proactively ask about it.
What is it? Paying for all four years of undergraduate costs upfront. Basically, rather than paying your child’s university bill on a semester basis, you pay a portion or most of the expenses upfront when they enroll.
I want to fully acknowledge that this option is truly the exception. In the past 20 years, average tuition costs rose by 144% at private universities and even more at public universities—165% for out-of-state students and 212% for in-state students (Source: Nancy Paul). Many families struggle to meet these high costs, either with or without incurring student loan debt.
But, if you are one of fortunate who can afford to do so, pre-paying your child’s college expenses could end up saving you money.
What You Need to Know
- Not every college and university offers a pre-payment plan
- There is no standard pre-payment plan, every school’s offering is unique. Schools that do offer upfront payment differ on terms and what exact expenses can be paid upfront (tuition, room and board, other fees and expenses)
- You are locking in prices at the time of enrollment—this is where you’re saving money; colleges often increase costs 4-5% or more from year to year
- You should consult your tax advisor prior to making any payment from a 529 plan
What Questions to Ask the School
- Does the university already offer a tuition rate “lock-in” for all four years? (ie, they guarantee the costs will not increase during a student’s tenure)
- What if my child decides to transfer to a different university?
- What if my child decides to study abroad?
- What if my child decides to live off-campus?
- What if my child takes a leave of absence?
- What if my child wants to take summer sessions?
What Are the Risks?
- The college doesn’t actually raise costs as much as they historically have—you’ll get the expense out of the way, but you won’t end up saving as much money as you thought
- The college raises the costs on the expenses that you haven’t pre-paid (for example, you pre-pay tuition as part of the university’s plan, but not room and board)
- Your child may enroll part-time at some point during their tenure, which are lower costs than the full-time costs you’re pre-paying
Saving for college is a marathon, not a sprint.
Want to know if you’re saving enough for college—or how to balance saving for college with your other goals? That’s where we come in. At Monument, we’re known for our straight-forward, unfiltered advice. We can and will answer your specific questions and help map out a plan–adapting and changing it as needed along the way. Whether you’re trying to save for a future college expense or want to know if paying in one lump sum is your best option, reach out to Monument, we can help.
Don’t miss our list of “10 Things All Investors Should Know”
Ready for straightforward, unfiltered opinion and tailored advice for YOUR questions, not everyone else’s?
IMPORTANT DISCLOSURE INFORMATION
Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Monument Capital Management, LLC [“Monument”]), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Monument.
Please remember that if you are a Monument client, it remains your responsibility to advise Monument, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Unless, and until, you notify us, in writing, to the contrary, we shall continue to provide services as we do currently. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Monument is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of Monument’s current written disclosure Brochure discussing our advisory services and fees is available for review upon request or at https://monumentwealthmanagement.com/disclosures/. Please Note: IF you are a Monument client, please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.
Please Note: Monument does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to Monument’s web site or blog or incorporated herein, and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.
Historical performance results for investment indices, benchmarks, and/or categories have been provided for general informational/comparison purposes only, and generally do not reflect the deduction of transaction and/or custodial charges, the deduction of an investment management fee, nor the impact of taxes, the incurrence of which would have the effect of decreasing historical performance results. It should not be assumed that your Monument account holdings correspond directly to any comparative indices or categories. Please Also Note: (1) performance results do not reflect the impact of taxes; (2) comparative benchmarks/indices may be more or less volatile than your Monument accounts; and, (3) a description of each comparative benchmark/index is available upon request.