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v35_school_planningIt’s back to the classroom for kids across the country – a time for excitement and trepidation by parents and students alike. Will your child be a sports standout? Will he or she succeed socially as well as scholastically?

It’s also a time when your focus on your child’s future intensifies. Will there be money for college? Will my child achieve financial success as an adult?

The following tips can help you find answers for these questions as you plan for the months ahead, and for many back-to-school days to come.

The biggest single expense you’ll incur for your children is college. Whether that’s five or 15 years off, the sooner you start planning, the better. Check out:

Cloverdale IRAs: These tax-deferred trust accounts were formerly called Education IRAs. With a Cloverdale IRA, individuals can invest up to $2,000 per year per child in an education fund. The IRAs can be used for expenses at elementary, secondary and post-secondary schools. When your child uses the benefits, they are tax-free as long as they are less than the qualified education expenses. Talk to your tax adviser for more information about these IRAs.

529 Plans: These are state-operated investment plans that help families save for future college costs. Family and friends may contribute to an account to pay for education expenses at an accredited post-secondary school; each person may contribute up to $10,000 per year. There are two types of plans – savings and prepaid. Savings plans work much like a 401(k) or IRA, where your contributions are invested in mutual funds or similar investments. With prepaid plans, you can pay to a specific in-state institution. The funds can also be converted to private and out-of-state colleges. You can compare state 529 plans at Recent law also allows institutions to offer their own 529 plans. You do not need to be a resident of a state to invest in its 529 Plan – for example, you can live in Arizona, plan to send your child to college in New York and invest in Vermont’s plan.

Family 401(k): Just as many companies match their employees’ contributions to 401(k) savings plans; parents can kick in a matching contribution to money their children save. For every dollar of their allowance they put away in the bank, you can match it in some way, some percentage that you can afford. This will give children a real incentive to save. Having their own savings account, and getting monthly statements from the bank, can also be a good way to teach them about interest and compounding.

As your children grow, you’ll want to know about financial information to fit their individual stages of life. Your financial services provider should be able to offer advice about planning for your child’s financial future at various ages. Ask about guidelines to help you achieve your financial goals, as well as accounts and services to help you meet these goals. For example, Wells Fargo’s online Parents Resource Center can help you determine where you are and where you need to be with college savings and planning. To access the resource center, go to

It’s also important to talk with your children about their goals and plans, and to work together to try to reach their educational dreams.

Whether your child is in sixth grade, a senior in high school or a sophomore in college, learning how to manage money is one of the most important lessons he or she will learn.

According to a recent study of high school seniors by JumpStart Coalition, only 16 percent have taken a course in money management or personal finance.

Your financial services provider should be able to provide help here as well. For example, Wells Fargo’s Hands on Banking® financial literacy program is available free-of-charge on the Internet at and The Hands on Banking program and its Spanish language version, El futuro en tus manos, take a fun approach to teaching the fundamentals of money management geared to four age groups, from grade-schoolers to adults.

Another great online resource is, an interactive resource for parents interested in helping their children develop successful money management habits and financial responsibility. The site features articles by experts, surveys, activities and lists of resources for parents and children.

New books, new classes, new challenges – as the school year begins, make this the time when you get your child’s future on track. Get good advice, set your plan in place and start taking steps toward your goal and you just might earn an “A” in planning for your child’s financial future.

Cary Yates is a market growth & development manager for Wells Fargo in Houston. To reach him, call 713-319-1724.

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