A 2013 study by Sallie Mae, a private company that services federal student loans, reveals that even in these tough economic times, American families belief in the value of college has been unwavering.
Why is a college education so valuable? Today, many people consider a college degree to be a necessity rather than a luxury. The job market has become fiercely competitive with hundreds if not thousands of applicants for every job advertised. In this climate, people with a college degree are often the best positioned to grab the brass ring.
Saving more, worrying less
The annual Sallie Mae survey, How America Pays for College, reported that in 2013 the vast majority of families still believe that higher education is an investment in the future. The financial services company, formerly named SLM Corporation, polls both parents and college students, to track attitudes toward attending and paying for college.
One finding of the latest survey is that parents are slightly more optimistic than in previous years about the value of college and their ability to pay for it. Parents in 2013 continued to worry about paying for college but to a significantly lesser degree than they had over the last three years, the survey found.
Preparing for the cost of higher education
The Sallie Mae report noted that the Great Recession of 2008-2009 has made parents cost-conscious in how they select and pay for college. Most respondents said that they eliminated some colleges from consideration because of costs; many took on more work hours to pay college bills, and some chose to not spend money for dorms by keeping their college students living at home.
Since the recession, the report said parents overall spending for college has declined while dependence on grants, scholarships and student loans has increased. The survey found that parents are contributing their own resources to fund their kids college educations and that putting money aside, specifically in college savings plans, is on the rise.
The use of college savings plans in 2013 increased to its highest level since 2008, when Sallie Mae started its survey. The 2013 survey focused on the use of 529 college savings plans offered by states and educational institutions. According to Sallie Mae, 17 percent of families used these plans in 2013, up from 11 percent in 2012.
The Gerber Life College Plan
Gerber Life Insurance Company offers a way to save for college that families may want to consider when planning for future higher-education costs for their children. The Gerber Life College Plan1 has a unique advantage: while you are putting away money towards your childs college education, you are maintaining life insurance for yourself.
Heres how it works:
You select an amount that you want to save for college, from $10,000 to $150,000 thats guaranteed to be paid after the time period you chose, between 10 and 20 years. If you die during that time period your beneficiary will still receive the full amount you had intended to set aside. In addition, the money does not have to be used for college it can be used for anything at all, without penalty, unlike requirements of some other save-for-college plans.
The Gerber Life College Plan offers numerous payment options that work with your budget, at a locked-in rate, so you can grow your childs college fund without stock market risk. The College Plan also builds cash value that can be borrowed* against should a need arise, and if all premiums are paid. It is backed by a company that has more than 45 years of insurance experience and is a financially separate affiliate of the Gerber Products Company, a name synonymous with caring for children.
The value of a college education
A college degree continues to be identified with better jobs and higher earnings. What parent wouldn’t want those advantages for their children? The Gerber Life College Plan is one way to help achieve the promise of a higher education. Learn more about how you can get started on our website.
* Policy loan interest rate is 8%.
1 Policy Form ICC09-PIE, Policy Form Series PIE-09