Did you make a New Year’s resolution to save (or save more) for college? If so, you may be increasing the odds that your student will attend and graduate. Research shows that, across income levels, students who have savings designated for college are more likely to attend and graduate. Overall, the study showed that children who were “expected” to attend college prior to graduating from high school and have at least $500 in college-designated savings are twice as likely to graduate from college than students with similar expectations but no savings. The results vary by income groups but show results even with very modest savings accounts. For example, a student from a low- to moderate-income household (income less than $50,000) with savings between $1 and $499 is three times more likely to attend college and four times more likely to graduate than a student from a similar household with no savings.
And, if your state offers a state tax deduction for contributions to its 529 plan, saving for college may be one of the better options for saving on 2018 taxes.