College has never been more expensive, with annual costs averaging nearly $60,000 at private institutions and even public institutions topping $27,000 a year.¹ For many families, those numbers aren’t just daunting — they redefine how parents think about their long-term financial goals.

With tuition costs rising and student debt reaching record highs, parents are under increasing pressure to support their children’s education without compromising their own financial security. Recent updates made under the One Big Beautiful Bill Act (OBBBA) are also changing the landscape of education savings and planning, including new flexibility for 529 plans and other funding options.

Understanding these shifts, and how to integrate them into broader financial strategies, can help advisors guide parent clients through investing in their children’s futures and protecting their own.

What Do Recent 529 Plan Updates Mean for Advisors and Families?

A 529 plan is a tax-advantaged vehicle designed to help families save for educational expenses, covering anything from K-12 education to student loan repayment. There are two main types of 529 plans:

• College savings plans, which allow funds to grow based on the performance of the underlying portfolios
• Prepaid tuition plans, which let families lock in tuition rates at participating institutions

For most families, the savings plan is the preferred option for its flexibility, investment options, and ability to adapt as circumstances evolve.

In recent years, legislative changes, including updates under the OBBBA, have made 529 plans more flexible than ever. No longer limited to just college tuition and fees, the law broadens what qualifies as an eligible expense under these savings plans, now including a wider range of K-12 costs like tutoring, educational materials, and testing fees. It also expands coverage to professional certifications and workforce training programs, recognizing that education today extends far beyond traditional four-year college.

For advisors, this expanded versatility is an opportunity to take a fresh look at how 529 plans fit into clients’ overall financial plans. Rather than treating education savings as a separate bucket, advisors can help integrate 529 strategies into estate and tax planning. That means making sure contributions and withdrawals align with tax rules, setting realistic savings targets, and adjusting plans as family goals or financial circumstances change.

In doing this, advisors can help clients make the most of their savings plans while still focusing on the bigger picture of their financial future.

Balancing Education Funding and Retirement Planning

The OBBBA’s updates may offer families more flexibility, but they don’t solve one of the most persistent financial challenges for parents: balancing their children’s education costs with their own retirement goals. Even with new planning opportunities, many families still face the difficult question of how to divide limited savings between college funds and long-term security.

Advisors play a pivotal role in guiding these difficult conversations. By helping clients identify their priorities and model different scenarios that show the trade-offs, advisors can demonstrate the long-term impact of their decisions. What happens if college savings are prioritized too heavily, or if retirement contributions are delayed too long?

For many parent clients, the most sustainable approach begins with securing their retirement first, then contributing what they can toward a 529 plan or other education savings once a safety net is in place. It’s important to remember that while there are many paths children can take to receive college funding, like loans, scholarships, and grants, parents have far fewer alternatives for financing retirement.

To help clients find balance, advisors can implement what experts call the “Y.E.S.” order of operations:

• You: prioritizing saving for retirement and building an emergency fund first
• Education Savings Accounts: contributing to 529 plans or other education savings accounts only when retirement savings are on track
• Savings: creating savings accounts for non-educational expenses, like first homes, weddings, and other life events

Balancing the reality of a parent client’s financial situation with their desire to support their children can be complicated. Parents may feel torn between helping with college expenses and staying on track with their own financial security. Studies show that nearly six in ten Americans have delayed retirement due to these competing financial goals.² Yet without sufficient retirement savings, the financial burden can eventually fall back to their children.

Advisors can help clients avoid this outcome by framing the conversation around long-term balance. By leveraging the new opportunities under the OBBBA and modeling how different savings strategies affect both education and retirement outcomes, advisors can empower clients to make informed decisions. In doing so, advisors can position families for success across generations, ensuring that parents and children alike have the financial foundation to pursue their futures confidently.

More on Retirement Planning

• Get insights on financial literacy from the Retirement Income Literacy Study
• Give your clients the gift of knowledge with a free education program, The Retirement Course®
• Become a retirement expert with our Retirement Income Certified Professional® (RICP®) Program

In this episode of the Shares podcast, College Professor of Practice Steve Parrish joins fellow instructor Mark McLennon for a deep dive into the tax planning and estate planning implications of the OBBBA. They cover the see-sawing history of tax policy in legislation, what provisions are out and in this time around, and the at times profound financial planning impacts that this latest incarnation of tax policy can have on estate planning and other elements of planning impacted by tax laws.

Steve Parrish, JD, RICP®, CLU®, ChFC®, AEP®, is a professor of practice and a scholar in residence at The American College of Financial Services’ Cary M. Maguire Center for Ethics in Financial Services, where he also serves as an adjunct professor of advanced planning. He joined the College in 2015, previously serving on the faculty of Drake University Law school where he was an adjunct professor of estate planning and interim director of the Compliance and Risk Management Department. Drawing on more than 45 years’ experience with companies such as The Principal Financial Group, Amerus Life Insurance Company, and his own advisory firm, Parrish is a recognized industry authority, spokesperson, and author. He continues to serve as an ongoing contributor for both Forbes.com and ReThinking65.com, is a contributing author to the 2023 e-textbook Retirement Plans and Retirement Planning, and will be the co-author of The Tools & Techniques of Life Insurance Planning, 10th Edition.

Mark McLennon, JD, CLU®, ChFC®, CFP®, CPA/PFS, is an assistant professor of tax and estate planning at The American College of Financial Services within the CFP® Certification Education and Chartered Financial Consultant® (ChFC®) programs. His private practice experience includes serving as a consultant in the tax division of Arthur Andersen & Co. in Chicago and as an attorney in the estate planning group of a large Milwaukee law firm. After several years as an advanced planning attorney for Allstate, Mark took on a similar role at Northwestern Mutual. In his more than two decades with the company, he was responsible for growth in the firm’s investment advisory and trust business, oversight of the fee-based financial planning program, personal trust administration, and wealth management advisor training.  He also played a key role in numerous enterprise-level initiatives, including the development of life insurance products for the estate planning market, as well as the implementation of trust and private client services.

Any views or opinions expressed in this podcast are the hosts’ and guests' own and do not necessarily represent those of The American College of Financial Services.

More on Tax and Estate Planning

• Learn more about the tax implications of the OBBBA
• Get specialized knowledge in tax planning with the Tax Planning Certified Professional® (TPCP®) designation
• Get more insights into estate planning with the Retirement Income Certified Professional® (RICP®) designation
   

The American College Cary M. Maguire Center for Ethics in Financial Services and the American College Center for Women in Financial Services partnered with InvestmentNews on September 23 to host the webcast, “The Advisor Shift: Rethinking Strategic Support for the Workplace of the Future,” which explored how firms can better attract, support, and retain the next generation of advisors.

Moderated by Kaylee Ranck, PhD, director of the Office of College Research, the session featured insights from Azish Filabi, JD, MA, managing director of the Center for Ethics in Financial Services, and Lindsey Lewis, MBA, ChFC®, CFP®, managing director and chair of the Center for Women in Financial Services. Together, they discussed the changing landscape of the industry with a focus on Gen Z’s career motivations and expectations.

The webcast examined what motivates Gen Z to pursue careers in financial services, the barriers they face early in their careers, and how firms can adapt to meet their expectations. Findings from the study revealed that competitive pay, work–life balance, and a sense of purpose are top motivators, while unclear career pathways, lack of training, and communication gaps often create friction.

Drawing from the Center for Ethics in Financial Services’ recent “Voices from the Field: Ethics Challenges in Financial Advisory Practices” research, Filabi highlighted how conflicts of interest tied to compensation structures, inconsistencies around fiduciary duty, and the constraints of proprietary products shape the ethical challenges advisors encounter early in their careers.

The webcast highlighted how aligning incentives, governance, and mentorship can help firms reduce ethical dilemmas and strengthen client trust.

More on Supporting the Advisor Shift

• Watch the on-demand webcast to discover how fostering ethics and transparency can strengthen advisor development and long-term trust The Advisor Shift: Rethinking Strategic Support for the Workplace of the Future.
• Download the full Voices from the Field report to explore the findings and gain critical insights on how financial advisors navigate trust in practice management.

In this fundamentals-focused session of the 2025 Advanced Special Needs Planning Symposium, College thought leaders Joellen Meckley, JD, MHS, ChSNC®, and Thomas Brinker, JD, LLM, PFS/CPA, AEP®, ChFC®, break down the basics of financial planning for individuals with special needs, their families, and their caregivers, including key considerations, vehicles, and strategies you need to know.

Meckley and Brinker begin their conversation with a discussion on the nature and reality of life for caregivers to individuals with special needs, be they family or professionals, and the challenges they face — as well as what they’re looking for from financial professionals who specialize in special needs planning. They then lay out the basics of creating a lifetime plan for an individual with special needs, including living arrangements, medical expenses, government benefits, and estate planning considerations.

Taxation in special needs planning is also examined through the use of special needs trusts and other vehicles, as well as benefits like the ABLE Act, important planning elements such as letters of intent, guardianship options, and more.

The program concludes with an examination of further education options available for financial professionals seeking to specialize in special needs planning, including designations like The College’s Chartered Special Needs Consultant® (ChSNC®) Program.

Program Outline

• Introduction (4:20)
• The Reality of Caregiving (7:17)
• What Caregivers Need From Financial Professionals (9:25)
• Creating a Lifetime Plan (12:17)
• Living Arrangements (20:48)
• Letters of Intent (26:32)
• Understanding the Tax Landscape (28:38)
• Reducing Tax Burdens for Caregivers (33:10)
• Medical Expenses and Benefits (35:31)
• Public and Government Benefits (42:20)
• Estate Planning Considerations (55:00)
• Special Needs Trusts (1:02:00)
• Community Pooled Trusts (1:09:00)
• Trust Taxation Basics (1:09:28)
• The ABLE Act (1:12:11)
• Guardianship and Other Alternatives (1:14:33)
• The ChSNC® Program (1:21:40)

CE credit is available for this session by logging into Knowledge Hub+, our on-demand subscription platform, and viewing the recording. Log in via your Learning Hub portal or subscribe now to get your credit.

Want to get the expertise to serve individuals with special needs and their caregivers? Learn more about the Chartered Special Needs Consultant® (ChSNC®) designation!