A Balanced Approach

Ken and Trina Weingarten know finances and believe strongly in higher education. The couple operates Weingarten Associates, a financial and tax planning firm in Lawrenceville, NJ. They have saved diligently for daughters Sofia and Elena’s college education, starting with contributions to a 529 savings plan for each child.

Strategic steps

While talking with other financial advisors, Ken learned about Private College 529. In June 2012, they rolled some of the funds from their 529 savings plans to open Private College 529 accounts. The girls were seven and ten at the time.

They made further rollovers in 2014 and 2017 to “rebalance” their college savings portfolios. In effect, they moved the fixed income portion of education assets to Private College 529, locking in guaranteed tuition rates. That allowed them to use a more aggressive allocation to stocks in the savings plan.

Savings and options

Sofia is starting college this fall and plans to attend Drexel University, a member college in the plan. This summer, they will begin to redeem their prepaid tuition. Elena is a high school freshman, so her college search is ahead of her.

By saving in both Private College 529 and a state savings plan, Ken and Trina have positioned their finances for their daughters. Combined with merit scholarship aid, most of Sofia’s tuition and fees will be covered with Private College 529 funds. And they plan to cover other costs with non-529 assets, leaving their state 529 funds for Elena—in addition to her Private College 529 account.

Ken points out a key benefit of prepaid tuition, “The current situation is potentially a parent’s worst nightmare. The huge stock market downturn this spring hit just as we’re getting ready to start paying tuition.

“While I would never recommend a parent have 100% of their child’s 529 money tied up in equities so close to college, I can only imagine the angst that some parents are feeling right now when they look at their account balances. I am definitely happy that a portion of Sofia’s college tuition expenses are already paid for.”

Donning his financial advisor hat, Ken describes his approach with clients, “For families with younger children and a bend toward private college, I’d recommend splitting savings—half in Private College 529 and the other half in a 529 savings plan. For families with older children actively considering a member of the plan, they should consider putting more than half into Private College 529.”

Family originally shared their story in May 2020