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5 College Saving Mistakes and Fixes

By Jonathan Sparling

  • January 3, 2023
  • 3 min read


Mother playing with young daughter outside

Whether you’re new to the college-saving process or have been saving for years, it’s easy to make mistakes along the way. Luckily, it’s just as easy to fix these mistakes and get back on the right path. Take a look at the most common college saving mistakes and what you can do to fix them.


1. Thinking it’s too late

It’s never too late to start saving for college, even if your child is a senior in high school. Any amount you save is helpful and will have minimal impact on their financial aid eligibility. You can easily avoid this common mistake by starting to save for college today.

The fix: Compare your options, choose a plan, and contribute often.


2. Forgetting to include family and friends

Holidays, birthdays, and other special occasions are ideal times to ask family members — who may be searching for gift ideas — to support your child’s college savings. If you have a 529 account, like Private College 529 Plan, the gifting process is easy. And with federal gift limits increasing in the New Year, there’s more room to give and less worry about tax implications. So, the next time you search for gift ideas for your child, keep college savings top of mind.

The fix: Invite family and friends to contribute to college savings. Most 529 plans offer an eGift option.


3. Skipping automatic contributions

Auto-contributions are the way to go if you want to grow your savings while avoiding extra work. It helps to remove any emotion that goes into investing money and keeps your account funded — monthly, quarterly, or annually, the frequency is up to you. And depending on your 529 plan, you could also benefit from dollar-cost averaging.

Skipping on auto-contributions means lost college savings, especially when we are tempted to put the money elsewhere. Almost all financial instruments, including 529 plans, savings, and brokerage accounts, make auto-contributions easy and typically have low minimums.

The fix: Decide on a contribution schedule and set it and forget it.


4. Failing to re-evaluate your goals

While you should avoid changing your financial goals every month, it’s important to re-evaluate them every few years. Life happens and circumstances change, which may impact your financial goals for college. So, it’s vital to look at the bigger picture, re-evaluate things, and check on your progress. And it might help to work with a financial planner to do this.

Ultimately, it’s best to already have a college savings number in mind. If you need help, we have you covered.

The fix: Look at recent life events and things coming up and ask yourself whether they change the goals you’ve set for college.


5. Forgoing 529 plans

Perhaps one of the biggest mistakes is not opening a 529 plan. 529 plans were created for college savers, offer incredible tax benefits, and remain one of the most flexible options for families. And based on recent legislative changes, it might even make sense to have a family member like a grandparent save for college in your child’s name. While there are many ways to save for college, 529s should be part of your saving strategy.

The fix: Start by looking at your state’s 529 savings plan. There are also a few prepaid plans out there, including Private College 529.


Recap: How to fix mistakes fast

  • Compare college saving options, choose a plan, and contribute
  • Invite family and friends to help
  • Set up auto-contributions
  • Re-evaluate your college savings goals
  • Open a 529 plan

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