It's almost time for college students across the country to move back into the dorms. And, if you (or your kids) are among them, you're probably getting a little stressed about how to keep your bank account in balance this year. Never fear! We're here with a team of Kiplinger experts to answer your questions about financial planning for college.
The chat kicks off at 1 p.m. ET on Thursday, August 1. In the meantime, feel free to leave a question here. See you then!
I'd generally recommend buying directly from the 529 plan rather than buying through a financial advisor -- that way, you'll avoid paying up-front sales loads and other extra charges. A financial advisor can help you make investment decisions, but if you're picking the plan and investments in the 529 yourself, or if you're in an age-weighted fund that automatically adjusts the investments through time, then you can save money by buying directly. And you can compare plans on a site such as www.savingforcollege.com to look for a plan that has low fees -- there can be quite a variation from plan to plan, but several of the low-cost mutual fund companies administer 529 plans and keep their fees pretty low.
Here's one from Tina, too:
You can generally keep your plan where it is even after you move -- you don't have to live in that state to contribute to a 529 there. But you should be able to transfer the money from one 529 to another if you'd like -- ask the plan about the rules. And if your new state offers a tax break for 529s, then you'll want to consider making your new contributions to that state's plan.
Great point about the tax break, Kim!
One cost associated with college that comes up a lot is studying abroad. Mary Clare, Ruisha, have you studied abroad?
Agreed, Mary Clare! And when the job hunt begins, a study abroad experience can pay you back by boosting your resume.
That sounds amazing. Though it can be really expensive, Europe is a great place for study abroad-ers. Many of the countries offer tons of discounts to students on everything from museum passes to food. In France, students can get a multi-course meal at a "canteen" for just a few euros. And, one editor here confesses to going to KFC for the student special. There aren't many places you can fill up for as little as 3 euros!
I haven't participated in short-term study abroad program before, but I'm an international student at the University of Missouri. One thing I pay attention to is wire transfer fees. Be sure to compare the fees of different banks and money transmitters. It can make a difference.
A 529 owned by the parents is counted as parental assets in the financial aid calculations, so it doesn't have nearly as much of an impact on financial aid as money saved in the child's name -- parents are expected to kick in 5.6% of their assets while students are expected to contribute 20% of their savings for college costs. By the way, there are some complicated rules for grandparent-owned 529s and financial aid -- see this column for details:
What do you guys think about comparing costs between different universities? Have any advice on how to do that?
And, here's another one from Steve: