For the average parent of a third-grader, back to school means shopping for backpacks, driving to cheerleading or football practice, and setting up parent-teacher conferences. But most parents may not have planned on one other important task—saving for a college education.

For a child in elementary school, it may seem early. A third-grader is actually halfway to college. It is never too early — or too late — to start saving for a child or grandchild’s education.

The U.S. Bureau of Labor Statistics recently reported the cost of college tuition and fees has increased 63 percent during the past 10 years. That number is three times the increase in the cost of other items we purchase every day. College housing, not including boarding costs, increased 51 percent. Text books shot up a staggering 88 percent.

Students are increasingly forced to take out loans to fulfill higher education dreams. In Mississippi, the average student graduates with more than $26,000 in student loan debt. Sixty percent of Mississippi grads begin careers strapped with burdensome college debt. Mississippi graduates have the highest percentage of student loans either past-due or in default in the nation.

Gov. Phil Bryant named September “College Savings Month” to encourage Mississippians to take advantage of the financially beneficial options the state offers to assist students with rising costs for higher education. Both the Mississippi Prepaid Affordable College Tuition plan, also known as MPACT, and the Mississippi Affordable College Savings plan, or MACS, offer tax advantages, including federal and state tax deductions, when saving for a child’s college education through these programs.

Whether choosing a private institution or one of Mississippi’s stellar state schools, a four-year degree or a two-year degree at our nationally-recognized community and junior colleges, the cost of a college education is rising. Between MPACT and MACS, there are savings options for every budget.

Business owners can help employees save as well by offering Mississippi’s college savings plans through payroll deduction. This deduction pays double the dividends at no extra cost.

First, business owners are investing in your employees today. The Wall Street Journal reported recently college savings is the next benefit companies offer to attract and retain quality employees. College savings programs help strengthen the corporate culture and may differentiate one company from another.

Second, consider this an investment in the employees of tomorrow. The sons and daughters of today’s workforce are the workforce of tomorrow. Studies show when saving for a child’s education, the child is seven times more likely to succeed in high school and pursue a higher education. By helping parents and grandparents save, employers are committing to higher education and workforce training and set a precedent for future job applicants.

Setting up payroll deduction is easy and has no cost. Many Mississippi companies already are providing college savings plans, including Ingalls Shipbuilding and Jackson State University. The staff at College Savings Mississippi assists with the process, no matter the size of the company. Offering the college savings programs to employees does not require any changes to tax reporting or additional record-keeping.

Best of all, when a college savings payroll deduction program is instituted, employees can allocate as little as $15 per paycheck, making saving for the future affordable and manageable.

Take advantage of College Savings Month and open a MACS or MPACT account for a child or grandchild today. And, for business owners, find out how to help employees save with payroll deduction. Everyone benefits when Mississippi children receive a higher education. Helping them afford those college dreams is an investment not only in their future, but in our state’s future as well.

 

Lynn Fitch is the Treasurer of the State of Mississippi, which runs College Savings Mississippi. For more information about MACS, MPACT, or payroll deduction, call 601-359-5255.