Ways to Save for College

College is expensive. It’s also pretty essential for most jobs in this high-tech, high creativity world. So it’s smart to begin saving for it as early as possible. Some experts predict that in 20 years, college could cost half a million dollars. So whether you're saving for your own or for a loved one's education, you're making a worthwhile investment.

Helpful Accounts

Money Markets Offer Liquidity

With up to six transfers available per month, Money Markets offer a flexible alternative for college savings. With a minimum deposit of $1,000 and terms from six months to 60, you can still use the money in the interim if you need it, but rack up more interest if you don’t.

Certificates of Deposit: High Interest

CUTX CDs have competitive interest rates and terms from six months to 60. Another good alternative for saving money for college, you retain the flexibility to use the money if necessary. The more you save, the more you earn, which helps maintain momentum for long term savings.

Start With a Savings Account

For many people, Money Markets and Certificates of Deposit might be phase two of the college savings plan. You can begin with a regular savings account that earns interest after a deposit of only $100. A journey of a thousand miles begins with a single step, the Chinese proverb says.

Lending Options

Pay for College with a HELOC

A Home Equity Line of Credit is a revolving debt—like a credit card—that uses the equity in your home as a source of funds. You take out what you need. Short on tuition this semester? Use your HELOC; pay it back next semester, or the one after.

Pay for College with a Home Equity Loan

Home Equity is the part of the house you’ve paid for. Equity goes up when you pay the loan down, or the value of the home rises. You can tap into that source of funds for college at very low interest rates. CUTX would be happy to help you figure out how to turn equity into education!

FAQs - Saving for College

In the U.S. nearly half of college students pay for school with family income and savings; more than 30 percent with parent income and savings. A third borrow money to pay for college. A third also receive grants and scholarships. Most families have a mix of all of the above.

Many people begin savings accounts, Money Market Accounts, and Certificates of Deposit to save toward a child’s education many years down the road.* *Money Markets and CDs offer higher interest rates because you commit to leaving the money in for longer. While there are some funds you can start specifically for higher education, Money Markets and CDs are more flexible in case your child decides not to go to college.

Many American households find that federal student loans, private student loans, or a blend of the two suit their needs. However some borrowers choose to use Home Equity Loans and HELOCS instead either because they do not qualify for traditional student loans. Additionally the interest rates on equity loans are low, and the family is essentially borrowing from themselves.