College Prep Tools | WA GET / WA529

College and
career prep

Forging your family's higher education path

- Not discussing who is responsible. Your child’s expectations about your contributions may not match reality.
- Stashing funds in a traditional savings account. Even the best interest rates tend to be 1% or less. Put your money to work for you.
- Ignoring inflation. College tuition inflation averaged 3.63% annually from 2010-2011 to 2022-2023.
- Compromising your nest egg. You can’t take a loan for your retirement, so don’t compromise your savings. Loans for school are not a bad thing, as long as you're not financing your student's entire education bill.
- Delaying the process. The power of compounding interest will be in your favor if you start early and invest wisely.
- Communicate and avoid double trouble. If multiple 529 accounts exist for the same beneficiary, make sure your don’t take multiple distributions for the same expense or you may be stuck with a taxable event.
- Make sure educational expenses are qualified. Lines can sometimes blur. Computer equipment is a great example.
- Distributions can be made to three parties: 1.) Account Owner, 2.) Student (Beneficiary), and 3.) School. Be sure to know how your distributions could affect your income taxes and financial aid packages. Please review IRS Publication 970.
- Don’t wait until the last minute. Spring semester payments can cause a problem because many folks take a 529 distribution in a year different from the year the qualified expense was billed.
- These plans are treated as an asset of the account owner (vs. the student) when calculating the expected family contribution toward college costs, so they have a comparatively low impact on financial aid eligibility.