Collaborative Paper Supports Increasing College Access by Promoting Savings

A summit on saving for college and 529 plans convened in March, bringing together representatives from financial services, state government, financial aid, and higher education. The results of these discussions, in which NASFAA participated, is a recently released white paper which discusses the challenges and opportunities around improving families' ability to save for college.

The paper outlines current challenges and offers recommended actions, including:

Creating a federally-funded campaign of Public Service Announcements (PSAs) serving as a low-cost, high-impact initiative to significantly boost awareness and adoption of 529 plans;
Providing an incentive for employers to offer 529 plans as part of benefits packages by passing legislation to allow non-taxable employer matching contributions; and
Removing the value of 529 savings plan from Federal Methodology (FM), thereby eliminating the perception that families are penalized for investing in the plans.

The proposals in the college savings summit white paper mirror a number of NASFAA recommendations in the National Conversation Initiative on Access and Aid for Student Success in Postsecondary Education (NCI). NASFAA's recommendations include engaging the federal government and the media in PSA campaigns to promote access and personal savings, promoting legislation that would provide a tax benefit to companies that contribute to students' college savings, and eliminating assets from the determination of a student's eligibility for federal student aid.

"The responsibility for our children's education must begin at home. Students and families have the primary responsibility to pay for college based on their individual ability. All families -- regardless of income or capacity for saving -- should be encouraged to begin saving as early as possible," the report notes,

By Jennifer Martin
NASFAA Assistant Director for Professional Assessment, Training, and Regulatory Assistance

Posted 06/23/09 to www.NASFAA.org. Redistribution to non-NASFAA institutions is prohibited. Please submit Web site questions or comments to Web@NASFAA.org.