5 Tips for Adults Planning to Return to College
Maybe you have heard this saying before: “It is never too late to learn”. Well, this is exactly the case of many people out there who, even while holding personal loans and other obligations, still decide to resume their studies or to start them anew despite having finished (or left) school a few years ago already.
In fact, every year, a great number of adults choose to either start studying or to at least improve their chances in the market by getting MBAs and such. Naturally, the best way to face this planned expenses should be with by starting a 529 plan, or to take a personal loan at very convenient terms, but you could also choose to simply save a small amount each semester. In any case, if you have in mind to return to study soon enough and you plan on using 529 plans should to do so, here are a few tips for you.
1. Plan as Early as Possible:
If you are not only an adult, but also a parent, you shouldn’t wait your children start college to start your own 529 plan. This also applies for you is you are the one planning to attend college. Saving for college provides the tremendous advantage of not having to pay any taxes on your savings. So, if for example, you contribute $3,000 a year for your funds for the next 10 years, then in that time you will have the entire $30,000 for schooling, almost entirely free of taxes.
2. Estimate Costs Carefully:
While being an adult might mean they you should not need to cover for room and board costs when attending college again, you might still have day-care expenses to take care of.In this regard, don’t expect things to be exactly the way they were when you attended last time, so get in touch with your school counselors to gain advice on what exactly to expect expenses-wise. Who knows? You might even need to start considering a personal loan.
On the good side, adults may qualify to have tuition reimbursement programs from the places they work at. If you are an older student, you could deposit funds to a 529 plan and then collect the tax deduction. Then, at the end of the semester, you could easily get your money back from your workplace. All of this might sound like a stretch for some, but you always have to consider all options when it comes to funding your college studies.
3. Review the Tax Reduction Rules of Your State:
Since the most common scenario when adults want to start studying again is to plan their rerun to college less than a year in advance, other than considering personal loans they should also consider their state tax deductions and matching grant programs with utmost care, since this will allow them to determine if it makes sense to start saving with a 529 plan.
For example, there is a cue in Maryland where a university graduate deposited the maximum state tax deductible amount in her 529 plan in the year 2012. That very same year, she withdrew her funds to pay for her tuition without any tax charges.
On the other hand, if you happen to live in Florida and to attend college next year, you wouldn’t benefit much from saving in a 529 plan to use the funds that same year, since the state down not have an income tax.
4. Use Funds From Education Tax Benefits:
If you went to college previously, you might still be paying a student or personal loan with interest. In this case, Federal tax refunds offer a great opportunity, since they can be deposited into a 529 plan for you education in the future. Claiming a student loan interest deduction can add as much as a few hundred dollars to your tax refund. remember that.
If you are a parent who was able to claim the education tax credit from the payments you made for your children’s education, you might be able to score up to $2,500 per child for their own education.
5. Ask Your Relatives for help:
Don’t forget that family 529 plan gifts are also for adults, so your parents, brothers, uncles and sisters can help you save as well, instead of you applying for a personal loan. So don’t be ashamed of asking for funding during birthdays, holidays and other special occasions.
Additionally, you could also use what are called “leftover funds” from accounts of your children and other relatives who might have been studying not long ago. And if one of them received a scholarship, then your chances of scoring a lot more funds will increase substantially.