KANSAS CITY, Mo. - The threat of skyrocketing student loan interest rates has many has many parents and students worried.
Millions of college students and grads could be forced to pay higher rates on their loans in a few months.
"The chances of getting a job straight out of college to pay for that is getting slimmer and slimmer now, so it’s a lot more stress to put on yourself,” said college student Maggie Cobb.
Unless congress acts, federal student loan rates will double in July from 3.4 percent to 6.8 percent. If you are a parent with children not yet in college, this student loan time bomb should be a warning, the experts say.
Experts suggest saving as much as you can now in a state 529 plan rather than paying later with interest charges.
The 529 program in Kansas is growing in popularity, increasing 21 percent in 2011 over the previous year.
"You can make a contribution and its deductible off your Kansas income tax and all of the investment income earned off of the program is tax free off of both federal and state income tax ," said Kansas Treasurer Ron Estes.
529 money is deductible on your state income taxes. The interest and growth does not get taxed.
"You can actually use this if you go to community college you can use if you go to a technical school as long as it is an accredited high education institution,” Estes said.
To learn more about the Kansas Learning Quest 529 program, visit http://bit.ly/IdmiJb .
To find out about Missouri’s 529 College Saving Plan, visit http://1.usa.gov/IL7jSG .
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