Families Report High College Savings Goals, But Don’t Have a Plan to Meet Them, Reveals New National Study from Sallie Mae

  Families Report High College Savings Goals, But Don’t Have a Plan to Meet
  Them, Reveals New National Study from Sallie Mae

  Sallie Mae Provides Resources, Recommends Parents of Infants Through Teens
                            Create a Plan to Save

Business Wire

NEWARK, Del. -- February 26, 2013

Despite rising college costs, fewer American families with children under age
18 save for college (50%) than did just two years ago (60%), according to a
research report released today from Sallie Mae and Ipsos. While nearly all
parents believe college is an investment in their child’s future, only
one-third have a plan to pay for college. Many families not yet saving for
college give non-monetary reasons that may be overcome with more financial
education. As part of America Saves Week, Sallie Mae encourages families to
start making saving for college a habit today.

“Households from all income groups are more likely to save successfully with a
plan,” said Nancy Register, director of America Saves – a national social
marketing campaign that encourages individuals and families to save money and
build personal wealth. “As the cost of college continues to rise, America
Saves Week, now through March 2, is a great opportunity for parents and their
children to make a plan to save for college.”

“We are concerned that many families are putting off financial preparations
for college,” said Sallie Mae President & COO Jack Remondi. “Saving even small
amounts can add up over time, and every bit helps. Sallie Mae is committed to
offering tools and resources to help.”

When asked to describe their feelings about saving for college, parents’ top
answers were overwhelmed, annoyed, frustrated, scared, or that they don’t like
thinking about it at all. Among those not saving, 47 percent cite a barrier
other than money. Top reasons included thinking that children would be awarded
enough financial aid to cover the cost of college, children are too young or
too old, uncertainty about which savings option to use, procrastination, and
feeling it is the child’s responsibility to pay for college.

Starting to save is most frequently prompted by major milestones such as a
child’s birth (34%), starting school (24%), or learning about college costs
from friends and family (20%).

Slightly more than one quarter (27%) of parents who are saving for college use
a 529 college savings plan. However, more parents save for college using
general funds or CDs (42%) and may miss out on tax incentives offered by a 529
account.

Sallie Mae’s Upromise college savings rewards program helps families save
little by little as they make everyday purchases, Sallie Mae’s subsidiary
Upromise Investments, Inc., and its affiliates, administer tax-advantaged 529
college savings plans in 16 states, and the Sallie Mae Bank offers savings
accounts and CDs. Tools to help understand the future costs of college and
create a plan are available at Salliemae.com/invest.

The report, “How America Saves for College,” is based on a nationally
representative survey of 1,621 parents of children under age 18. The full
study and related infographic are available at
www.SallieMae.com/HowAmericaSaves.

Sallie Mae (NASDAQ: SLM) is the nation’s No. 1 financial services company
specializing in education. Celebrating 40 years of making a difference, Sallie
Mae continues to turn education dreams into reality for American families,
today serving 25 million customers. With products and services that include
529 college savings plans, Upromise rewards, scholarship search and planning
tools, education loans, insurance, and online banking, Sallie Mae offers
solutions that help families save, plan, and pay for college. Sallie Mae also
provides financial services to hundreds of college campuses as well as to
federal and state governments. Learn more at SallieMae.com. Commonly known as
Sallie Mae, SLM Corporation and its subsidiaries are not sponsored by or
agencies of the United States of America.

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Contact:

Media contact:
Sallie Mae:
Debby Hohler, 617-454-6741
dhohler@upromise.com
or
Ipsos:
Meghann Jones, 202-420-2019
meghann.jones@ipsos.com
 
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