Some common misconceptions can make it seem impossible to afford a college education. Below we dispel several of these myths—and give you reasons to be optimistic.

Don’t Fall for the Myths

MYTH: If you can’t save nearly enough to pay for your child’s college education, there’s no point in trying.

FACT: Each year, federal and state governments, colleges, and other organizations award more than $174 billion in undergraduate financial aid*—in the form of grants, scholarships, student loans, and work-study.

MYTH: If you didn’t start saving when your child was born, it’s too late.

FACT: It’s never too late. While it’s better to start saving early because it takes time for investment “compounding” to generate earnings, you can still benefit from tax benefits and some asset growth if you start saving when your child is older.

MYTH: You can’t afford to save if you have a tight budget.

FACT: If you’re able to set aside a few dollars a month, then you can save for college. Obviously, the more you can save the better, but it doesn’t take much to get started.

MYTH: If you save too much, you won’t get any financial aid.

FACT: The biggest factor in calculating Student Aid Index to college costs is annual income—not parental assets such as savings. In fact, no more than 5.6% of parental assets are included in the financial aid formula.

MYTH: With so much financial aid available, it doesn’t make sense to save.

FACT: While financial aid is widely available, almost every family is still required to contribute at least some money to pay for college costs.

MYTH: College saving plans are too restrictive.

FACT: Actually, the opposite is true. Savings in a 529 plan can typically be used for a wide range of qualified expenses—tuition, food, housing, books, and required supplies and equipment—at any accredited college in the United States and some foreign institutions.

*The College Board, Trends in Student Aid 2022