A parent-friendly guide to understanding college savings options before high school starts...
When it comes to family finances, many parents assume they’ll revisit things when the timing feels “right.” The problem is that perfect timing rarely shows up. Instead, financial decisions tend to pile up all at once—when kids are about to start high school, get their first job, or prepare for bigger transitions.
That’s why the middle school to early high school years are such an important planning window. Kids are old enough for money to start feeling real, but there’s still time to review, adjust, and prepare without urgency.
This stage isn’t about optimizing every account or choosing the “best” financial strategy. It’s about understanding what tools exist, what they’re designed to do, and whether they still align with your family’s current reality.
Traditional College Savings Options Many Families Start With...
When parents first begin saving for college, they often start with the most commonly discussed options. These accounts are designed specifically for education expenses and can be effective tools when families understand both their benefits and their limitations.
529 College Savings Plan
529 plans are one of the most widely used college savings tools because they’re built specifically for education-related expenses. Contributions are invested and grow over time, and funds are generally intended to be used for qualified education costs.
For many families, 529 plans offer structure and tax advantages, which can make them appealing for long-term college planning. They’re often used as a foundational account, especially when parents are confident that funds will be applied toward education.
That said, 529 plans are not one-size-fits-all. Because they’re designed with education in mind, families should be aware that how and when the money is used matters. Plans and rules can evolve, and flexibility may be limited compared to other savings options. Understanding these tradeoffs early helps parents decide how much to commit—and whether to pair a 529 with more flexible alternatives.
Education Savings Accounts (ESAs)
Education Savings Accounts, sometimes referred to as Coverdell ESAs, are another education-focused savings option that some families explore. Like 529 plans, they’re intended to support education expenses, but they operate with different contribution rules and investment flexibility.
Some parents appreciate ESAs for their broader educational use across different stages of schooling, while others use them as a complement rather than a replacement for a 529 plan. Because contribution limits and eligibility rules are more restrictive, ESAs tend to work best for families who are intentionally layering multiple savings tools.
Savings Options Parents Often Overlook
While education-specific accounts are often the first place parents look, many families benefit from including more flexible savings options in their college planning. These options aren’t designed exclusively for education, but that flexibility can be valuable—especially when a child’s future plans aren’t fully defined yet.
UGMA Accounts
Custodial investment accounts, commonly referred to as UGMA or UTMA accounts, allow parents to invest money on behalf of a child while maintaining control until the child reaches adulthood.
These accounts are sometimes used by families who want:
Broader investment flexibility
The ability to use funds for more than just education
A way to introduce children to investing concepts over time
However, custodial accounts also come with important considerations. Assets are legally owned by the child and typically transfer to them at a specific age. Because of this, parents often use these accounts thoughtfully and as part of a broader strategy rather than as a sole college savings vehicle.
High-Yield Savings Accounts
High-yield savings accounts offer a simple, low-stress way to set aside money for future education costs. While they don’t offer the same growth potential as investment-based accounts, they provide liquidity and predictability—qualities that can be especially helpful as college gets closer.
Some families use high-yield savings accounts for:
Short-term college expenses
Supplementing other savings accounts
Holding funds while deciding on longer-term strategies
For parents who value accessibility and stability, these accounts can play an important supporting role in a college savings plan, particularly in the years leading up to high school and beyond.
How Financial Aid Can Influence College Savings Decisions...
When parents think about college savings, it’s easy to focus only on how much to save. But how savings are structured can also influence a student’s financial aid picture. Understanding this relationship early—before high school—can help families avoid surprises later.
Different Types of Assets Are Viewed Differently
Not all savings are treated the same when colleges evaluate financial aid eligibility. Some assets are considered more accessible for education costs than others, which can influence how aid packages are calculated.
For parents, the key takeaway is that the type of account holding college savings can matter just as much as the amount saved. This is one reason many families choose to spread savings across multiple account types rather than relying on a single option.
Planning Early Creates More Flexibility
Families who review savings options before high school have more time to adjust if needed. Early planning allows parents to:
Revisit account choices as income changes
Balance flexibility with structure
Avoid last-minute decisions during peak application years
By contrast, waiting until junior or senior year can limit options and increase stress during an already busy time.
Financial Aid Is Only One Part of the Equation
While financial aid can play a meaningful role in college affordability, it shouldn’t be the only factor guiding savings decisions. Every family’s situation is different, and aid eligibility can change year to year based on income, school selection, and other variables.
Understanding the general relationship between savings and financial aid helps parents plan with confidence—without trying to predict every outcome. The goal is balance: saving thoughtfully while staying flexible as plans evolve.
What Parents Should Consider Before Choosing Any College Savings Option...
Reviewing these factors before high school helps families make choices that fit their needs now while leaving room to adapt later.
Time Horizon
How many years remain before college can influence how families approach savings? Parents with more time may be comfortable with long-term strategies, while those closer to high school often prioritize stability and accessibility. Knowing where you fall on this timeline can help narrow options without rushing decisions.
Flexibility vs. Restrictions
Some savings tools are designed for specific uses, while others allow funds to be used more broadly. Parents who value flexibility—especially when college plans aren’t fully defined—often look for ways to balance structured accounts with more adaptable options.
Ownership and Control
Who legally owns the account, who controls the funds, and when that control changes are important details to understand. Some accounts remain under parental control long-term, while others transfer ownership to the child at a certain age.
Thinking through comfort levels around control helps parents avoid surprises and align savings choices with family values.
Tax Considerations
While many college savings options include tax-related benefits, those benefits vary by account type and situation. Parents don’t need to know every rule, but having a general understanding of how taxes might apply can help frame smarter conversations and planning decisions.
Comfort With Risk
Every family has a different tolerance for investment risk. Some parents prefer steady, predictable growth, while others are comfortable with more variability over time. Being honest about risk tolerance can help guide which savings tools feel manageable and sustainable.
When parents consider these factors together, college savings becomes less about finding a perfect solution and more about building a plan that feels thoughtful, flexible, and realistic.
College savings doesn’t have to be overwhelming, and it doesn’t require a perfect plan from day one. For parents approaching the middle school and early high school years, the most important step is simply understanding what options exist and how they differ.
By reviewing college savings choices early, families give themselves time—time to adjust, time to stay flexible, and time to make thoughtful decisions without pressure. Whether you’re using education-specific accounts, more flexible savings tools, or a combination of both, awareness creates confidence.
This blog post is in collaboration with Responsival!
