This story is sponsored by My529. Learn more about My529.

Rising tuition costs and America’s whopping $1.4 trillion student loan debt have prompted many parents to make saving for college a financial priority.

Savvy savers know that it isn’t enough just to put money aside for college. Rather, a 529 college savings plan is the way to go. Here’s why:

Saving is cheaper than borrowing

Establishing a college savings plan now can save you thousands in the future. For example, if you plan to rely on student loans to support college costs, be prepared to pay more than twice as much for that education, according to Goal Investor.

Fortunately, many American families understand the math and don’t rely on loans to fund education.

“In 2017-2018, families spent an average of $26,458 on college," according to Sallie Mae’s How America Pays for College report. "Income and savings covered nearly half of that cost."

A 529 plan is an investment

More than just savings plans, 529s are investment vehicles which can offer you growth in ways other savings accounts can’t. Your 529 funds are invested, allowing you benefits akin to your 401(k).

My529, Utah’s official 529 college savings plan, offers 14 investment options to allow account owners the benefits of several different investment strategies.

Tax advantages

When it comes to college expenses, it’s not just tuition costs you have to consider. There are also expenses for computers, software, books, supplies, equipment, and room and board. That means you'll need every penny you can get. The good news is, with a 529 college savings plan, you can grow your savings tax-deferred.

Earnings used to cover higher education expenses won’t be taxed on the federal or state level, allowing you to put those saved dollars toward funding your child’s college career.

Tax credits or deductions

More than 30 states offer full or partial state tax deductions for contributions to a 529 plan, according to savingforcollege.com.

In Utah, individuals, couples, corporations and trusts benefit from a five percent state income tax credit for annual contributions up to a certain amount, according to My529.

The ability to write off 529 contributions reduces your state income tax burden, giving you the freedom to use more money for your child’s education.

Flexible spending

You can use the untaxed money in your 529 plan to cover expenses at the college, university, post-secondary, vocational or technical school level. You can even use it for tuition at K-12 schools, according to My529.

Customizable features

When you have a 529 account, you choose how to get the most out of your investment. Depending on your goals, you can opt for a plan that requires low to no minimum contribution, or go with the option that allows non-account owners to contribute, according to Student Loan Hero.

Unused funds aren't lost

If you invest more than you end up needing for education, the great thing about a 529 account is you can withdraw funds and use them for non-qualified expenses.

“529 Plan accounts are not ‘use it or lose it’ accounts," according to Forbes. "The money in the account is always yours to withdraw, but you will owe tax on the earnings when you withdraw money for non-qualified expenses.”

Easy to open

Anyone 18 or older can open a 529 account for free. You don’t need to be related to the beneficiary, and you can even open an account for yourself. You can also open an account in Utah even if you aren't a resident.

Learn more about a 529 plan at my529.org. It’s never too soon or too late to start saving for an education.

Before investing in my529, consider the benefits of your home state’s 529 plan (if any), and read the Program Description to learn more information about the investment objectives, risks, charges and expenses, by going to www.my529.org or calling 800-418-2551.

This story is sponsored by My529. Learn more about My529.

For years, thanks to study after study, it’s been common knowledge that college graduates earn significantly more than high school graduates, so high school students have been encouraged to seek four-year degrees. But attending a university isn’t for everyone.

The average salary for young adults with bachelor’s degrees is 57 percent higher than those with high school diplomas ($31,800), according to the National Center for Education Statistics, but the costs for that degree are high. Tuition, fees, room and board for just one year range from $20,090 for an in-state public four-year college to $45,370 for a private nonprofit four-year school, according to the College Board. Multiply that times four, and you’ll pay at least $80,000 to $181,000 for a degree.

So, what can a wise high school graduate do to seek a higher income? And what about that 529 college savings plan parents or grandparents set up to help with college costs?

Vocational schools cost less and provide the opportunity for graduates to earn better wages than if they had finished only high school — and 529s can be used for vocational training.

“The average trade school degree costs $33,000, which, compared to (the average) $127,000 bachelor’s degree, means a savings of $94,000,” writes Trent Hamm for The Simple Dollar. “But that’s not all! If you assume that students are fully financing their education with loans at 4 percent over 10 years, the bachelor’s degree will cost $154,000, while the trade school degree will cost only $40,000. That’s a savings of $114,000 just on the degree.”

Factor in wages and a vocational school can be a great alternative for a high school graduate.

“Salaries for trade school graduates aren’t that much of a drop-off compared to a four-year degree,” Hamm writes. “According to the National Center for Educational Statistics, technical and trade school jobs have a median annual salary of $35,720, though this figure varies heavily based on the particular industry and the experience level of the worker. The (Bureau of Labor Statistics) predicted earnings for bachelor’s degree holders to be roughly $46,900, amounting to an annual difference of $11,180.”

There are many well-paying jobs for workers without bachelor’s degrees: 29 million pay between $35,000 and $75,000 a year, according to a joint study by Georgetown University Center on Education and Workforce and Civic Enterprises. The study found that career and technical education jobs have largely shifted from blue-collar occupations to white-collar and health care fields.

“For both men and women, the best CTE jobs are in sub-baccalaureate STEM (science, technology, engineering, and mathematics) and health care, where over 80 percent of jobs pay middle-class wages,” according to the study’s authors. The study contends that the nation’s career and technical education system, which includes vocational schools, “is the missing middle ground in American education and workforce preparation.”

Many people automatically associate 529s or post-high school studies with four-year university degrees. But vocational schools are smart alternatives for students who want to train for a well-paying career as well as save on those infamously high college costs. Plus, that 529 is good toward any postgraduate study, not just four-year colleges.

Vocational schools are eligible educational institutions where 529 funds can be used to pay for qualified higher education expenses. Money saved in a 529 plan, such as My529, can be used to pay expenses, including tuition, mandatory fees, books and even computers at any postsecondary institution — college, university or vocational school — in the United States or abroad that participates in federal financial aid programs.

Today, postsecondary certificates are the second-most common higher educational achievement award after a bachelor’s degree, exceeding associate and master’s degrees, according to the Georgetown study. About 1 million postsecondary certificates are awarded each year. For more information about 529 plans, visit my529.org or call 800-418-2551.

Important Legal Notice

Investing is an important decision. Read the Program Description in its entirety for more information and consider all investment objectives, risks, charges, and expenses before investing. For a copy of the Program Description, call 800.418.2551 or visit my529.org.

Investments in my529 are not insured or guaranteed by my529, the Utah State Board of Regents, the Utah Higher Education Assistance Authority or any other state or federal agency. Your investment could lose value. However, Federal Deposit Insurance Corporation (FDIC) insurance is provided for the FDIC-insured accounts. Please read the Program Description to learn about the FDIC-insured accounts.

The state in which you or your beneficiary pays taxes or lives may offer a 529 plan that provides state tax or other benefits, such as financial aid, scholarship funds, and protection from creditors, not otherwise available to you by investing in my529. You should consider such benefits, if any, before investing in my529.

my529 does not provide legal, financial, investment, or tax advice, and the information provided in this document does not contain legal, financial, investment, or tax advice and cannot be construed as such or relied upon for those purposes. You should consult your own tax or legal advisor to determine the effect of federal and state tax laws on your particular situation.