Contributed by: Nicholas E. Gonzalez, CEPA, CRPS, CDMA

Investing in the education of future generations is one of the most impactful legacies a family can create. For many affluent families, this means going beyond standard savings plans and exploring sophisticated strategies that ensure educational goals are met while maintaining financial stability. Granite Harbor Advisors understands the unique challenges and opportunities of educational planning, and we are here to help you navigate this essential aspect of wealth management.

The Rising Cost of Education

Higher education costs have been steadily increasing for decades, and projections show this trend is unlikely to reverse. According to the National Center for Education Statistics, the average annual cost of tuition and fees for a private university in the United States now exceeds $38,000. Add room, board, and other expenses, and families can easily face a six-figure investment for a single undergraduate degree.

For families with multiple children, or those interested in funding advanced degrees, private school tuition, or even international study opportunities—careful planning is essential.

Key Steps for Planning Educational Investments

Granite Harbor Advisors recommends taking a structured approach to educational planning. Here are a few areas to be mindful of:

1. Define Your Educational Vision

• Decide what type of educational experiences you want to support.
• Consider whether you wish to fund tuition only or include other costs, such as housing, extracurricular activities, or travel.
• Explore the potential for supporting multiple generations, from your children to your grandchildren.

2. Estimate Costs Over Time

• Project the costs of education based on today’s figures and anticipated inflation rates.
• Account for differences in costs between public and private institutions, in-state vs. out of state tuition, and other factors.
• Use financial modeling tools to understand the impact of these investments on your overall wealth plan.

3. Leverage Tax-Advantaged Savings Options

• 529 Plans: These allow tax free growth when funds are used for qualifying educational expenses. Additionally, many states offer tax deductions or credits for contributions.
• Coverdell Education Savings Accounts (ESAs): While less flexible than 529 plans, ESAs can be a valuable tool for families with specific educational goals.

4. Explore Private Market Opportunities

• Families with significant wealth may benefit from investments in private markets that align with educational planning goals.
• Options include setting up trusts or family foundations that can be directed toward educational purposes.

5. Incorporate Legacy Planning

• Establish irrevocable trusts or foundations that earmark resources for education.
• Ensure your family’s broader estate plan aligns with your educational goals. This might include provisions for gifting assets to younger generations.

6. Mitigate Risk

• Implement life insurance strategies to protect educational funding sources in case of premature death.
• Diversify investment portfolios to reduce the impact of market volatility on your educational savings.
• Ensure your college savings portfolio adjusts appropriately to align with the expected time horizon and risk tolerance.

Start Securing the Future Today

Education is a transformative gift, but planning for it requires expertise and foresight. By working with Granite Harbor Advisors, you can ensure that your family’s educational investments are purposeful, sustainable, and aligned with your broader financial goals. Contact us today to schedule a consultation and begin building a comprehensive educational investment plan for future generations. Let’s secure your family’s legacy together.

Reference National Center for Education Statistics.