Sunday, June 01, 2014

College Costs A Bigger Hurdle Than Health Care Costs For Many

Terry Horan, CLU, ChFC is CEO of HORAN Associates, HORAN Capital Advisors' business partner. Terry often states the two greatest challenges facing Americans today are:
  • access to quality, affordable health care; and
  • securing professional counsel to build and sustain wealth for a lifetime
After seeing a report from JP Morgan Asset Management, I wonder if one of the greatest challenges of all for families is being able to finance their children's education. Below are several slides pulled from the 46-page booklet. First a couple of highlights:
  • since 1983 college tuition costs have increased faster than any other household expense. Tuition costs have increased a cumulative 645% versus health care's cumulative increase of 326%.
  • at a 5% annual increase, college costs will more than double by 2030
  • for children born today, the projected cost of a four-year private college education will total over $409,913. The same cost for a public education will total over $185,000.

From The Blog of HORAN Capital Advisors

From The Blog of HORAN Capital Advisors

From The Blog of HORAN Capital Advisors

Young families will be hard pressed to save enough funds to finance their children's education costs. In addition to a well thought out saving plan, the dollars saved will need to be invested in asset classes that can generate significant positive returns. In our firm's view bonds will not grow at an adequate rate so families will need to position their investments in potentially better returning asset classes like equities and alternatives.


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