What will it take to save for a college education?
Tuition and expenses in today's dollars
Years of college
Years until college
College savings to date
Amount you can save monthly
Your savings rate
Your federal tax rate
Your state tax rate
A lump-sum investment is an investment that you make to open an investment or savings account. It is used to jump-start an investment or savings account. Possible sources of lump-sum investments include inheritances, lump-sum distributions from retirement plans, and proceeds from a life insurance policy.
Section 529 plans:
A special tax-advantaged plan, operated by a state government or an educational institution, used to save for the college education of a child, grandchild, or other dependent.
The yearly percentage increase in prices. The annual inflation rate in the U.S. has averaged about 2-3% in the last 10 years.
An account that does not receive the tax breaks that either a tax-exempt account or tax-deferred account are eligible to receive.
A general increase in prices that you pay for goods and services, stated as a yearly rate.
Savings interest rate:
The yearly interest rate you earn on your savings.
An investment account with tax-deferred or tax-exempt features that are used to save for retirement, college, and other educational expenses.
Coverdell education savings account (ESA):
A tax-advantaged investment account designed to encourage savings to cover future elementary, secondary or college education expenses.