For many families, paying for college is not just a major expense—it is a decision that can shape other financial priorities for years to come.

The strongest education funding strategies are rarely built around a single solution. More often, they combine savings, current cash flow, financial aid, borrowing, and family support in a way that fits within a broader financial plan.

That broader view matters. College planning is not just about covering tuition. It is about balancing education goals with retirement readiness, tax strategy, legacy intentions, and the flexibility to adapt as plans evolve.

1. Begin With a Funding Strategy

Before choosing where to save or how to pay, start by defining what you may actually need to fund.

Many families focus first on tuition, but the full cost of attendance often includes room and board, books, fees, technology, transportation, and other related expenses. A more complete estimate can help you make better decisions about how much to save, how much to cover from income, and whether borrowing may play a role.

A thoughtful funding strategy may help you:

• estimate the full cost of college
• decide how much you want to fund directly
• evaluate what may come from savings, income, aid, or loans
• consider whether grandparents or other family members may contribute
• understand how college funding fits alongside retirement and other long-term priorities

When education planning is viewed in the context of your broader financial life, it often becomes easier to make more informed decisions.

2. Use 529 Plans Purposefully

For many families, a 529 plan remains one of the most effective ways to save for education. These accounts offer tax-advantaged growth, and withdrawals are generally tax-free when used for qualified education expenses.

Recent rule changes have also expanded how 529 plans may be used. Depending on the situation, 529 funds may help cover not only certain higher education expenses, but also some K-12 costs, apprenticeship programs, student loan repayment, and, subject to specific requirements, Roth IRA rollovers for beneficiaries.

That flexibility may make a 529 plan especially valuable for families who want to:

• save in a tax-aware way for future education costs
• preserve flexibility as a student’s path evolves
• coordinate education gifts across generations
• build a more structured long-term funding strategy

At the same time, not every 529 approach is the same. Contribution levels, withdrawal timing, beneficiary decisions, and state-specific rules all deserve careful attention.

3. Use Current Cash Flow Where Appropriate

Not every education expense needs to be funded years in advance. In some cases, it may make sense to cover a portion of college costs from current income as bills come due.

For families with stable cash flow, this approach can offer flexibility and reduce the risk of overcommitting assets too early. It may also work well alongside a 529 strategy, allowing invested assets to continue growing until they are needed.

Paying from current income may make sense when:

• household income is stable and predictable
• expected education costs are manageable relative to annual earnings
• scholarships or other aid may reduce the total amount needed
• other long-term assets are better preserved for retirement or legacy goals

Often, the strongest strategy is not choosing between savings and cash flow, but coordinating both.

4. Understand Financial Aid Early

Even families who do not expect to qualify for significant need-based aid may benefit from understanding how financial aid works.

Aid can influence college decisions, reduce out-of-pocket costs, and shape how much a family may need to save or borrow. In many cases, better planning starts with understanding the net cost of a school—not just the published price.

Planning ahead may help families:

• understand the difference between need-based and merit-based aid
• prepare for deadlines and documentation requirements
• compare schools more effectively
• evaluate aid as one part of a broader college funding strategy

Financial aid should not be treated as a last-minute consideration. It is often an important part of a more complete plan.

5. Borrow Carefully and With a Plan

Borrowing can be a useful tool, but it should be approached with care and with a clear understanding of how repayment may affect future finances.

Student loans may be appropriate in some situations, particularly when they help preserve flexibility or avoid disrupting longer-term financial goals. But debt should be evaluated realistically in light of repayment costs, projected income, and the broader impact on both students and parents.

Before borrowing, families may want to consider:

• the total amount likely to be borrowed over four years
• expected monthly repayment costs after graduation
• whether borrowing will be in the student’s name, a parent’s name, or both
• whether projected debt levels align with future income expectations
• whether other funding sources may reduce the need for loans

Used thoughtfully, borrowing can support a plan. Used too aggressively, it can create financial pressure for years to come.

6. Coordinate Family Support Thoughtfully

For many families, paying for college is a multigenerational effort. Grandparents and other relatives often want to help, but how that support is structured can make a meaningful difference.

Support may come through:

• contributions to a 529 plan
• direct financial gifts
• help with books, housing, or other expenses
• broader tax or estate planning strategies intended to benefit the next generation

When multiple family members are involved, coordination becomes especially important. A more intentional approach can help avoid duplication, improve tax efficiency, and align everyone around the same goals.

In many cases, education funding is not just about paying for school. It is also about family values, opportunity, and the legacy a family wants to create.

7. Build Flexibility Into the Plan

If there is one principle families should keep in mind, it is flexibility.

Education plans do not always unfold exactly as expected. A student may receive scholarship support, choose a less expensive school, pursue a credentialing program, attend trade school, take a gap year, or finish with unused education funds.

That is why a strong college funding strategy should account for questions such as:

• What happens if all 529 funds are not needed?
• What if a student takes a nontraditional educational path?
• Could another beneficiary use some of the funds?
• How should withdrawals be timed for tax efficiency?
• Have recent rule changes created new planning opportunities?

The most effective plans are not built around one fixed outcome. They are designed to adapt as life changes.

Common College Planning Mistakes to Avoid

Even well-intentioned families can make decisions that create unnecessary strain later. A few common pitfalls include:

Focusing Too Narrowly on Tuition

The full cost of attendance often includes much more than tuition alone. Underestimating those added costs can lead to funding gaps later.

Prioritizing College Over Retirement

Helping a child or grandchild is important, but parents should be careful not to undermine their own long-term financial security in the process.

Overfunding Without a Broader Strategy

Education savings can be powerful, but they work best when coordinated with changing family goals, beneficiary options, and the potential for unused funds.

Waiting Too Long to Start Planning

The earlier a family begins planning, the more flexibility it typically has—whether that means saving gradually, adjusting strategy, or preparing for changing circumstances over time.

Treating College Funding as a Standalone Decision

Education planning often connects to tax strategy, investment planning, estate considerations, and long-term cash flow needs. Looking at the full picture can lead to better outcomes.

What Families Should Consider Now

As you think about future education costs, it may be helpful to revisit a few key questions:

• How much of future college costs do you want to fund yourself?
• Which assets are best suited for education planning, and which should be preserved for other goals?
• Does your current 529 strategy still reflect your family’s needs and the latest rules?
• Are grandparents or other family members planning to contribute?
• Have you built enough flexibility into your plan if circumstances change?

A thoughtful education strategy may help you prepare not only for the cost of college, but also for the choices and tradeoffs that often come with it.

Plan for More^TM With a More Coordinated Education Strategy

At Janney, we understand that education planning is rarely just about paying a future tuition bill. It is about making informed decisions that support your family’s goals while staying aligned with your broader financial life.

A Janney Financial Advisor can help you evaluate your options, weigh tradeoffs, and build an education planning strategy that reflects your priorities, your family dynamics, and the opportunities you want to create in the years ahead.