529 Plan and College Savings

Posts Tagged ‘savings rate’

Question: What are some good college savings funds which can keep up with soaring tuition rates nationwide?

Answer: The 529 Plan is the most well-known and probably the most respected college savings plan out there. I don’t know much about it, but here’s a website:

http://www.collegesavings.org/whatIs529.aspx

Upromise is also a pretty cool program. It gives you money every time you buy something from their partners. And it’s places you’ll shop at all the time, not like unknown companies.

http://www.upromise.com/what-is-upromise-earn-save-pay-for-college.do?cx=l1&cm_re=gav1-_-L1VisitorNav-_-WhatIsUpromise

If you’re wanting to save for next year, or if you aren’t going to need the money soon, I would put your savings in a Certificate of Deposit (CD). They have much higher interest rates than regular savings accounts (which are like 1.4%). I just recently put $10K in a 7-month CD that has a fixed interest rate of 4%. So, that’s not bad considering interest rates are pretty low right now. You can also do shorter CD’s, like 3 months. Anyway, that’s what I do. You just have to make sure the interest rate you’re receiving is larger than the inflation rate. Otherwise, you aren’t really gaining anything if you think about it.

Rates are at All Time Lows!