As graduation season comes and goes by, families across the country are celebrating important milestones. Whether it’s preschool, grade school, high school, or higher education, commencement ceremonies mark the beginning of a new chapter filled with excitement, uncertainty … and major financial decisions.

For many families, this time of year also sparks conversations about the rising cost of education and how to prepare for future expenses. While private school tuition and college costs continue to increase, proactive planning can help families feel more confident about the road ahead.

Understanding the Cost of Education

The cost of education has changed significantly over the past several decades. Tuition, housing, books, and other related expenses can add up quickly, making it important for families to start planning early.

While every student’s path is different, many families are exploring ways to balance education goals with long-term financial priorities like retirement, homeownership, and supporting multiple children.

How 529 Plans Can Help

One tool many families use to save for education expenses is a 529 college savings plan.

A 529 plan allows contributions to grow tax-deferred, and qualified withdrawals for eligible education expenses are generally tax-free. Funds can often be used for tuition, room and board, books, certain apprenticeship programs, and in some cases, K-12 tuition expenses.

These plans also offer flexibility. If one beneficiary does not use the full balance, funds may be transferred to another qualifying family member.

Recent legislative changes have also expanded options for unused 529 assets, including opportunities to roll certain unused funds into a Roth IRA for the beneficiary, subject to eligibility requirements and limitations.

It’s Never Too Early, or Too Late, to Plan

Many families assume they need to start saving when children are very young, but every little bit counts. Even modest, consistent contributions over time can help reduce future borrowing needs.

Graduation season can also serve as a reminder for grandparents and extended family members who wish to support future education goals through gifting strategies or contributions to education savings plans.

The most important step is simply having a plan that aligns with your family’s goals, timeline, and overall financial picture.

Looking Ahead

Education planning is about more than tuition bills. It’s about creating opportunities, supporting future goals, and helping families prepare for important life transitions with greater confidence.

If you have questions about education savings strategies, college planning, or how a 529 plan may fit into your broader financial plan, BridgePort Financial Solutions is here to help.

Investors should carefully consider investment objectives, risks, charges, and expenses. This and other important information is contained in the fund prospectuses, summary prospectuses and 529 Product Program Description, which can be obtained from a financial professional and should be read carefully before investing. Depending on your state of residence, there may be an in-state plan that offers tax and other benefits which may include financial aid, scholarship funds, and protection from creditors. Before investing in any state's 529 plan, investors should consult a tax professional. If withdrawals from 529 plans are used for purposes other than qualified education, the earnings will be subject to a 10% federal tax penalty in addition to federal and, if applicable, state income tax.