How Credit Unions Can Help You Save for College
Published: June 16, 2025 6:45 pmAs college tuition rises, planning and saving for your child’s education has become a significant concern for many families. The cost of higher education can seem daunting, but resources help ease the financial burden.
One valuable resource is your local credit union. Credit unions provide various financial services tailored to help families save for college effectively. They can also help you set up a youth savings account immediately.
Understanding the Role of Credit Unions
Credit unions are financial institutions that operate to serve their members’ financial needs rather than generate profits. This structure allows credit unions to offer low interest rates on loans, reduced fees, and higher interest rates on savings accounts than other banks.
Regarding saving for college, this member-first approach means that credit unions can provide tailored solutions to help families with future educational expenses.
Opening a Dedicated Savings Account
One of the first steps in saving for college is to set up a dedicated savings account. Many credit unions offer specialized college and youth savings accounts with higher interest rates than standard ones.
A youth savings account can help families save money while earning interest. Credit unions might even offer lower fees or no minimum balance, making it easier for families to start saving, even if they can only contribute a little at a time.
529 College Savings Plans
A 529 plan is designed to be a tax-advantaged savings account for education expenses. Contributions to this plan grow tax-free, and withdrawals for qualified education expenses are also tax-free.
Many credit unions can help you set up a 529 plan or provide information about your state’s offerings. This allows families to benefit from the tax advantages while also receiving guidance from knowledgeable credit union staff.
Financial Education and Guidance
In addition to providing a youth savings account, credit unions often offer financial education workshops and resources. These workshops can cover various topics, including budgeting, understanding financial aid, and the ins and outs of applying for scholarships.
By participating in these educational sessions, families can become more knowledgeable about their options and better equipped to make informed financial decisions regarding college expenses.
Low-Interest Loans
Even with diligent saving, families might still need additional financial assistance to cover tuition and fees. Credit unions typically offer lower-interest student loans compared to traditional banks. These loans can help bridge the gap between what has been saved and what is needed for college.
Helping You Set Up a Youth Savings Account
Saving for college can feel overwhelming, but your credit union can be a vital partner in this endeavor. By taking advantage of these resources, you can build a financial plan tailored to your family’s unique needs, making the dream of a college education more attainable. Contact Energy One Federal Credit Union to take the first steps.