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Have You Had ‘The Talk’?

If you want your child to go to college someday, it may be time

It can be an awkward conversation to have with a young child, but there’s no reason to feel uncomfortable – it’s a natural part of growing up.

We’re referring to “The Talk,” and when this subject is brought up, it’s typically followed by the common question: When is the right time to have it?

The short answer: The sooner the better. Because before you know it, your child will have to make adult decisions. As parents, we want those choices to be healthy, well-informed ones.

Look, let’s be real – this topic is all over TV, in the news and plastered on social media. Your kids are probably already somewhat familiar with it. After all, student loan debt is a national crisis. With more than $1.5 trillion in U.S. student loan debt carried by over 44.7 million Americans, student loan debt is second only to mortgages, and ahead of auto loans and credit card debt combined.

The dangers of student loans

Wait. You thought we were talking about the birds and the bees? No, not that conversation. However, this talk is just as important.

Kids are considered adults at the age of 18, about the time they graduate from high school. If they are interested in higher education, then they should know the importance of that commitment.

Falling in love with learning is natural, and something that should be encouraged. But parents also want their children to make safe choices, and one way to ensure that they make a safe choice when it comes to higher education is to be sure they understand the expenses associated with it.

A 529 college savings plan is one way to help avoid student loan debt. And so, if you’ve opened a 529 plan for your child, it’s a good idea to explain why you are saving and why you are making such an important investment in their future. It’s also important because children who know they have a college savings account are six times more likely to attend college.

But again, that talk can be hard to start, so here’s one way “The Talk” might go for a child who has a 529 plan in his or her name.

Begin the dialog …

Mom: Emma, can you come down here? Your father and I would like to have a little talk with you.

Emma: Am I in trouble?

Dad: No, no, quite the opposite, sweetheart.

Mom: Emma, your dad and I have opened a 529 college savings plan in your name. You know what college is, right?

Emma: Sure, it’s school for grown-ups, where I can go to learn about big things. Maybe how to put together giant buildings.

Dad: That’s right. And it’s important for you to know that college costs a lot of money, and why it’s important for us to save money in a college savings plan for you.

Mom: Your 529 plan may or may not pay for all of your college expenses, but we know that whatever amount we have in the plan for you will help when you are ready to take that next step.

Emma: Why do you sound so serious?

Mom: Well, it is serious. We don’t want to scare you, honey. We just want to be sure you don’t have a big college loan debt like your dad and I did. We’re trying to lessen the burden for you – we’re trying to lessen the burden for you so that after you graduate from college, instead of making large student loan payments, you have the opportunity to use that money for things like buying a home, starting a family, or maybe buying a new car.

Dad: And we want you to know why we’re saving – so you can fulfill your dream of being a famous architect who designs skyscrapers.

Emma: OK, thank you. Can I go back to building my LEGO world now?

See . . . that wasn’t so hard

Whether your child is honing in on an engineering degree, or wants to be a hair stylist, chef or a professional farrier (yep, you can use a 529 plan to pay for horseshoe school, too), talking with your children about the importance of saving for college is a conversation worth having.

And they’ll know that investing in a 529 college savings plan now means they can focus on translating those plans for a LEGO building into a real-life downtown skyline rather than worrying about the burden of paying off a student loan debt.

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