Back to School Documents that Every College Student Needs

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Back to School Documents that Every College Student Needs

By: Kathryn Gioia , Legacy Planning Attorney at Bowles Rice LLC

Your college students are back at college, and they have their financial aid, books, laptops, dorm room supplies, groceries…but do they have everything that they need? Your college student needs legal documents as they head back to school to ensure that you are able to make key medical and emergency decisions for your child should something occur.

Waiver of Family Educational Rights and Privacy Act (FERPA)

With your child now being a legal adult, you no longer have the ability to access their education information. This may seem unfair if you are paying for their education, but nevertheless no access is permitted automatically under FERPA. Your child will need to fill out their college’s FERPA waiver in order for you to have access to your child’s college records.

Key exceptions where a FERPA waiver is not required include medical emergency, underage drinking, and dependents (who meet certain criteria).

Financial DocumentFinancial Power of Attorney

This power of attorney (POA) document allows your child to designate someone who will be able to handle your child’s financial matters. This is everything from accessing your child’s bank account to pay bills, to filing tax returns. There are 2 different kinds of POAs, springing and durable. A springing POA means that the document is not effective to give the designated agent his/her powers until some event, such as incapacitation, occurs. A durable POA is effective immediately which means that whoever your child designates as the agent has the power to assist with the finances of your child as soon as the POA is signed.

Medical Authorizations and Documents

Now that your child has attained 18 years of age, they are legally an adult and you are no longer able to automatically access, and be privy to, your child’s medical records. This can be scary for parents, but your child can take several steps to keep you involved in your child’s care.

HIPPA Authorization
This authorization is key to allow doctors to speak to you about your child’s medical care in case of emergency.

Medical Power of Attorney
This document allows your child to select someone who can make medical decisions for your child should your child be unable to communicate with medical care providers.

Living Will
This document allows your child to choose someone who will make end-of-life care decisions on your child’s behalf. This document is especially hard for families to think about because no one wants to consider that their young college student would be in a vegetative state. However, as I always say, it’s better to be prepared now than to scramble latter. A living will only becomes effective when your child is unable to make their own decisions and is in an end-stage medical condition or permanently unconscious.

*For each of the medical and financial documents it is the best practice for your child to appoint not only a primary agent to act on their behalf but also a contingent agent who would step in and act if the primary agent is unavailable or unable to act.

Insurance

Insurance for your child’s belongings

According to BestColleges.com, burglaries accounted for around 7,000 of the 22,000 on-campus crimes in 2020. No one wants to think about this but just like we protect our houses and our belongings with homeowners’ insurance, our children need to protect their belongings with insurance as well.

Verify with your insurance carrier whether or not your child’s belongings are covered under your homeowners’ policy when your child is at college or if your child needs his/her own renters’ policy. Also, make sure that your child’s laptop and other expensive items that are key to their education are covered by insurance. It is a good idea to inventory your child’s valuables that have been taken to college, listing the cost of each, so that you are better prepared in case you, of your child need to file an insurance claim.

Car Insurance

Check with your auto insurance whether your child’s car is included on your or your child’s own auto policy. Your child may have downsized to a new car for college or bought a new car of their own. Either way always take the time to verify the terms of the policy to know what is covered, i.e. does the policy include a rental car if the car is in the shop, what’s the liability coverage, is the coverage enough, are towing services included, etc.?

It is also important to have a conversation with your child that no one is allowed to drive that car other than your child. If someone else drives your child’s car and is involved in an accident then the owner of the vehicle may have liability exposure.

It can be hard to think of your child as an adult but once they turn 18 your child is a legal adult and new laws will apply to your child’s information, belongings, etc. Help your college student be prepared and work with an experienced professional today to make sure that your child is prepared and protected.

Kathryn Gioia

Legacy Planning Attorney of Bowles Rice LLC

Kathryn Gioia is a Pennsylvania-based legacy planning attorney who helps individuals and families protect what they’ve built—especially when planning for the future, caring for loved ones, and navigating life transitions. With an education-first, compassionate approach, Kathryn creates clear, customized estate plans (including wills, trusts, powers of attorney, and advance directives) designed to reduce uncertainty, preserve family intentions, and safeguard assets across generations. She’s also experienced in probate and trust administration, guiding clients and fiduciaries through complex legal and tax steps with patience, plain-language explanations, and steady support when it matters most.

Will a Coverdell or 529 help save more money for my kid’s education?

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Will a Coverdell or 529 help save more money for my kid’s education?

By: Rob Cucchiaro, CFP®, CRPC, AAMS, President at Summit Wealth & Retirement Partners

As the cost of education continues to rise, setting up a plan to cover your child’s college tuition is becoming more and more important. When starting to save, the first decision many parents make is choosing between a Coverdell Education Savings Account (ESA) and a 529 plan.

Both options are popular because they can provide tax-free growth when used for qualified education expenses—but they each come with unique rules, limits, and flexibility. Here’s a clear breakdown to help you understand the differences and decide what may fit your goals best.

What Is a 529 Plan?

A 529 Plan is a state-sponsored education savings plan that allows money to grow tax-free and be withdrawn tax-free when used for qualified education expenses.

Qualified Education Expenses (529)

Qualified expenses typically include:

Tuition
Fees
Books and supplies
Room and board (for eligible students)

Key Benefits of a 529 Plan

No annual contribution limit (though states may cap the total account balance)
No income limits to contribute—anyone can contribute
Tax-free withdrawals for qualified education expenses
Can be used for:
- College expenses (no limit)
- K–12 tuition (up to $10,000 per year)
- Apprenticeship programs
- Student loan repayment (up to $10,000 lifetime)

group of students with tablet pc at school library

Types of 529 Plans

Artificial intelligence is becoming a powerful partner in personal finance. You may already see it in the form of personalized savings tips, budgeting insights or fraud alerts that catch suspicious activity within seconds.

AI can analyze your spending patterns and highlight opportunities that might otherwise go unnoticed. For example, it might identify extra cash flow you can redirect toward retirement or flag a subscription you forgot you were paying for. While AI cannot replace professional advice, it can create a clearer picture of your money in between planning meetings.

1) Education Savings Plan (Most Common)

This is the type most families use. You contribute money and select from pre-built investment portfolios offered by the plan (you typically cannot pick individual stocks or funds).

2) Prepid Tuition Plan (Less Common)

Prepaid plans allow you to lock in today’s tuition rates for a specific school.

Why prepaid plans are less common:

Only nine states offer them
Often requires that the funds be used at a specific school
Admission isn’t guaranteed, which adds risk

Contribution & Account Limits (529)

While there are no technical contribution limits, many states do set a maximum account value (total balance cap)

Examples mentioned:

California: $529,000 maximum
Idaho: $500,000 maximum

Taxes & Penalties (529)

When used for qualified education expenses, withdrawals are federal and state income-tax free. If used for non-qualified purposes, withdrawals may be subject to:

Income taxes, plus
A 10% penalty(Certain exceptions may apply, such as in cases of death or disability.)

What if your child doesn’t need the funds?

If your child receives a scholarship or doesn’t attend school, you may have options such as:

Transfer the 529 to a qualified relative
In some cases, transfer to a Roth IRA
- (Roth IRA transfers generally require the 529 to be at least 15 years old)

State Tax Notes (California vs. Idaho)

California: 529 contributions are not tax-deductible
Idaho: 529 contributions are tax-deductible
- Up to $6,000 (single filers)
- Up to $12,000 (joint filers)

What Is a Coverdell Education Savings Account (ESA)?

A Coverdell ESA is another education savings option that also provides tax advantages, but it has stricter limits.

Two Major Differences: Coverdell vs. 529

Annual contribution limit: $2,000 per year
Investment flexibility: You can choose how to invest (not limited to preset portfolios)
Coverdell ESA Rules to Know

Withdrawals & Taxes

Withdrawals are tax-free as long as they do not exceed the total qualified education expenses in that year.

If withdrawals are more than that year’s expenses, the excess is taxed at the account holder’s normal income tax rate.

Income Limits to Contribute

You can’t contribute if your income exceeds:

$110,000 (single)
$220,000 (married filing jointly)

Age Limit

Funds must be used by the time the child turns 30. If not used for education, the money is generally taxed as ordinary income.

State Tax Notes (Coverdell ESA)

In both California and Idaho, Coverdell ESA contributions are not tax-deductible.

Which Is Better: 529 or Coverdell?

Both accounts can be useful—it depends on your savings goals, income, and how much investment control you want.

A 529 Plan may be better if:

You plan to contribute more than $2,000 per year
You have a high income (and still want to contribute)
You’re okay choosing from pre-built investment portfolios
You want broader flexibility for qualified education uses

A Coverdell ESA may be better if:

You want more investment control
You plan to contribute $2,000 or less per year
Your income is within the eligibility thresholds
You’re comfortable with the “use by age 30” rule

Final Thoughts

Saving for education is a long-term decision, and the “right” account depends on your personal situation. As always, we recommend working with a tax professional who understands both tax strategies and wealth management to ensure your plan fits your goals.

Disclosure / Important Information

This material is purely intended to be general and educational in nature, and should not be construed as specifically-tailored investment, financial planning, tax, legal, or other professional advice. Information and data contained herein is as-of the date of publication, and may be subject to change in the future without notice. Any investment performance referenced is purely past performance, which is no guarantee of any future performance. Nothing contained herein should be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation of any security or other financial product or investment strategy. All investment, tax, and financial planning strategies involve risk that you should be prepared to bear. You are highly encouraged to consult with professionals of your choosing before taking any action based on this material.

Rob Cucchiaro, CFP®, CRPC, AAMS i

President of Summit Wealth & Retirement

Rob Cucchiaro, CFP®, CRPC, AAMS, is an Idaho-based financial planner who helps individuals and families make confident, informed decisions about their money—especially as they navigate big goals like retirement, tax planning, and building long-term security. With a clear, education-first approach, Rob focuses on creating practical, values-aligned strategies designed to reduce financial stress and bring more clarity to day-to-day decisions. He’s known for breaking down complex topics into straightforward guidance, empowering clients to feel in control of their finances and prepared for what’s next.

Securing Your Child’s Future: College Savings Strategies for Divorcing Parents

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Blog Series

Securing Your Child’s Future: College Savings Strategies for Divorcing Parents

Many of the parents we work with have no structured college savings plans set up for their children. Sadly, after a divorce, the chance of creating a plan is even less likely. When people divorce, there are many complex issues that need to be decided and college planning for the children typically takes a back seat to everything else. Statements like “We’ll work it out when the time comes” or “We’ll set something up after the divorce, when things calm down” are common phrases from our clients. I cringe when I hear my clients utter these phrases. Even parents with the best intentions have a hard time following through with these promises once the divorce is finalized. Chances are, if something is not agreed to and entered in court, nothing may get done. This, in turn, will lead to heated post-divorce college planning arguments, court dates, and legal fees when it comes time to pay for college.

Whether your child is 6 months or 16 years old, plans need to be made now for their college education. Pushing these decisions to a later date is not in your children’s best interests. As part of any divorce involving children, a family-focused divorce mediator will ensure a plan is put down on paper. They will help you implement a plan that works for both of you and benefits your children the most by helping provide for their college education.

One major question divorcing parents have when discussing college planning as part of their divorce is, “Where is the money going to come from to fund a college savings plan?” This is an excellent question without easy answers. When going through a divorce and making plans to live financially independently from one another, parents need to stretch their money as far as possible, and since money doesn’t grow on trees, funding college savings accounts is an issue.

As a divorce mediator who works with families on a daily basis and one who has two children in college at the same time, I have a few suggestions about how to “find” some of the money needed for your children’s college planning. Though the following are not foolproof remedies, as every family is different, one of the below ideas may help:

1. Claiming of the children:

Chances are that when you were married, you filed joint tax returns. Once you are divorced, you will file individual tax returns. Your income, tax bracket, and who claims the children in a given year will have a financial impact on each of your individual tax returns, possibly making your combined individual tax returns greater than your married ones. I suggest speaking with an accountant who is experienced in divorce and divorce law. The extra money you receive as individuals can go toward a college savings plan.

2. Reviewing Auto, Homeowners and Life Insurance policies:

Speak to your current agent about what can be done to reduce your costs without lowering your coverage and obtain quotes from other insurance companies. However, be careful not to reduce your coverage and possibly put your family in financial ruin just to save a few dollars per month.

3. Make monthly auto-deposits:

Set up monthly auto deposits into your children’s college savings plans, bank accounts, and investments. No matter what the amount, anything is better than nothing, and having it done automatically makes it “out of sight, out of mind.” Otherwise, there will always be a different way you might need or want to spend that money.

4. Designate a certain amount:

Designate a portion of your tax return, work bonus, or commission check to go toward your children’s college savings plans.

5. Ask family to help:

Instead of family members giving your children unnecessary gifts for their birthdays and holidays, ask them to deposit money into their college savings account.

6. FAFSA:

Who claims a child on their tax return as they get closer to high school graduation is very important when filling out the F.A.F.S.A. (Free Application for Federal Student Aid). Though this is not a savings plan, doing this the right way may save thousands of dollars in interest payments on student loans and set your child up for better financial aid.

Some of the above suggestions, specifically 1, 3, 4 and 6, can be made legally binding by adding specific language to your divorce agreement. Some people need something in writing to ensure they will, in fact, plan for their children’s college education.

Though none of these suggestions will pay for 4 years of college, if followed, they are proven ways to start saving and chipping away at the ever-growing cost of college.

It is also very important to keep in mind other costs during your child’s college years: health insurance, clothing, cell phones, vehicle expenses and insurance, and spending money, for example. Once your child graduates from high school, college is the only expense you are legally required to help provide for your child. Make sure your divorce agreement plans for these costs and how they are paid.

Brian James

Divorce Mediator and Parenting Coordinator at C.E.L. & Associates, Inc.

At C.E.L. & Associates, Inc., we are dedicated to peaceful, cost-effective agreements that make sense and are good for everyone involved, especially our clients’ children. We have 8 offices throughout Chicagoland and Southeast Wisconsin. And now with Zoom capability, we are able to be even more flexible scheduling meetings and have found benefits in meeting via Zoom that we never imagined possible: lower cost, less stress, more time efficient, expedited from start to finish and better overall satisfaction with the process.