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Getting a Head Start on College Savings

College can become one of the largest expenses a family faces.

For the 2025–26 academic year, the average total student budget at a public four-year in-state college is approximately $30,990. That includes more than tuition alone—it may also include housing, food, books, transportation, and personal expenses.

Those numbers can feel overwhelming, especially while parents are also paying for childcare, housing, activities, healthcare, and retirement. But you do not need to fund the entire cost at once.

At True North Wealth Management, we help families begin with a practical strategy: start early, save consistently, and keep college planning connected to the rest of the financial plan.

Give Your Savings More Time

Time can be one of your greatest advantages.

Suppose you save $100 per month for 17 years. Your contributions alone would total $20,400. If those contributions earned a hypothetical average annual return of 5%, the account could grow to roughly $32,000.

That example is hypothetical and does not reflect any specific investment, but it illustrates why starting earlier can matter. More time gives contributions and potential earnings longer to compound.

Even a modest amount can create progress when saved consistently.

Set a Realistic College Goal

You do not necessarily need to save enough to cover every education expense.

Your goal might be to fund:

Defining the goal can make saving feel more manageable and help you measure progress.

Consider a 529 Plan

A 529 plan is a tax-advantaged education savings program established by a state or state agency.

Contributions are not deductible on the federal return, but investment earnings can grow tax-deferred, and withdrawals are generally tax-free when used for qualified education expenses.

Qualified uses may include eligible tuition, fees, books, supplies, equipment, and certain room-and-board costs, subject to applicable rules.

529 plans vary by state, including investment choices, fees, and potential state tax benefits. Alaska does not impose an individual state income tax, so families may place greater emphasis on plan costs, investment options, and flexibility when comparing plans.

Use Automatic Contributions

Automatic saving removes the need to make the same decision every month.

You might schedule contributions:

Grandparents and other family members may also be able to contribute, depending on the plan.

Do Not Count on Scholarships Alone

Scholarships and financial aid can reduce college costs, but families should not build the entire plan around aid that has not yet been awarded.

The actual amount a student pays may differ significantly from the school’s advertised price. Federal Student Aid recommends using each college’s net price calculator to estimate costs after grants and scholarships.

Families should also complete the FAFSA when the student applies for college because schools use it to determine eligibility for federal and other financial aid.

Protect Your Retirement

Parents naturally want to help their children avoid debt, but college savings should not come at the expense of long-term retirement security.

Students may have access to scholarships, grants, work, lower-cost schools, and student loans. Parents cannot finance retirement in the same way.

Before reducing retirement contributions or withdrawing retirement assets for college, consider how that decision could affect:

A balanced strategy supports education without placing the parents’ future at risk.

Review the Plan as Your Child Grows

College goals can change.

Your child may pursue a trade program, attend school in Alaska, receive scholarships, live at home, transfer from a community college, or choose a different path entirely.

Review your college savings strategy periodically and adjust for:

Start With What You Can

The perfect contribution amount is less important than beginning.

At True North Wealth Management, we help families coordinate college savings, 529 plans, financial aid, investments, taxes, and retirement goals.

Starting today—even with a small recurring amount—can give your child more options later while keeping your broader financial plan on course.

Important Disclosures:
This material is for informational purposes only and is not intended as tax, legal, accounting, financial aid, education, or individualized investment advice. The growth example is hypothetical, assumes a constant 5% annual return, and does not include taxes, fees, or market fluctuations. Investments involve risk, including possible loss of principal. 529 plan rules, qualified expenses, tax treatment, investment options, and financial aid effects may change. Consult qualified tax, legal, financial aid, and financial professionals regarding your circumstances.

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite and customized by True North Wealth Management LLC to provide information on a topic that may be of interest. FMG Suite is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright FMG Suite.