Planning for College
Find tools to help you fund your child's college education plan
In addition to grants and scholarships, and loans from federal and private sources, there are a number of ways to accumulate—or tap—the resources you'll need when planning for your child's college education. Here are four popular college financial strategies for doing so.
1. 529 education plans
State-sponsored legislation created these plans as a flexible and tax-advantaged way to invest for higher education purposes. They are popular because most plans allow you to invest as little as $15 per month, to shift a portion of your estate to future generations, and even to fund your own higher education if you'd like. You can learn more about 529 education products offered through Citizens Investment Services.
Please consider the investment objectives, risks, and charges and expenses associated with municipal fund securities before investing. More information about municipal fund securities is available in the issuer's official statement.
This is a simple, manageable college savings plan offered by Citizens Bank. Just open a CollegeSaver account before your child's sixth birthday, save a minimum of $25 a month each year, and receive a bonus of $1,000, plus interest, when the child turns 18. You can even set up free, automatic Steady Save® transfers from a Citizens Bank checking account to help you stay on track.
3. Savings bonds
This college education plan is a tried and true way for families to begin planning for college and saving, sometimes as early as the child's birth. Over the years, bonds purchased in the child's name and given on the occasion of birthdays and other holidays can really add up when the bonds are redeemed at a premium over their face value, representing the accumulated interest.
4. Home equity loans
If you don't have enough savings to cover your child's cost of attendance, consider financing options to cover the remaining expense. For some families, depending on their circumstances, one of the best options for funding their child's education is tapping the equity in their home, through a home equity loan.
Among the attractions of home equity loans:
- The interest rate is fixed at the time of application
- The loan amount is limited only by the amount of equity in the applicant's home, their debt-to-income ratio and their credit-worthiness
- Home equity loans may qualify you for tax breaks, since in many cases the interest you pay is tax-deductible (check with your tax advisor first)
- Monthly payments for 10-year home equity loans are comparable to Federal PLUS loans
Learn more about other Citizens Bank college financing options
In addition to home equity loans, private student loans can help pay for your child's education expenses. Learn more about our Citizens Bank TruFit Student Loan®. If you still have questions, call a student loan specialist at 1-800-708-6684, and we'll help walk you through the process.