With the cost of college continuing to climb, many parents worry how they are going to pay for their child's college education without burdening them with crushing student loan debt.
Saving for college has always been a time consuming and confusing process. I know from experience as I have two children in college and we have a 529 College Savings Account for both of them. I wish the process had been easier when we were setting the savings account up back then.
U-Nest is an easy to use mobile app that takes the guesswork out of planning for your child's college education costs and it couldn't be easier to use. I have 529 accounts for both of my children with Vanguard and quite honestly it's not easy to access the accounts and check on any transactions or request funds for reimbursement of college expenses on my mobile phone. I do pretty much everything on my phone so I tend to use services that have robust mobile platforms.
I don't recommend products often but when I find one that is exceptional at meeting a need and offers value, I owe it to my readers to share.
How it Works
1. Download the U-Nest app on your phone
Yes, it's as simple as that! You can open an account in minutes and be on your way to securing a brighter future for your child. Once you download the app to your phone, there is an easy and secure process for linking your bank account to your U-Nest account so that you can make automatic monthly transfers into your child's account.
2. Establish a monthly contribution plan
The U-Nest app has a great calculator that lets you see what the cost of college might be when your child is ready to attend. Based upon the expected cost, you create a savings goal and choose the monthly contribution that meets your needs. U-Nest's team of financial experts looked at hundreds of 529 plans and picked the best plan available for your family.
3. Keep Track of Savings on Your Phone
One of the best features of U-Nest is the ability to monitor your account balances, make changes to contributions, and manage transactions all from the convenience of your phone. Your savings plan is constantly optimized behind the scenes for you so that you can be sure that your money is invested in the appropriate mix of asset classes to meet your child's college financing needs.
I wanted to learn more about what makes U-Nest different from the other investing platforms and was fortunate to be able to connect with the founder and CEO of U-Nest, Ksenia Yudina, CFA, MBA.
Interview with Ksenia Yudina, CFA, MBA and Founder and CEO of U-Nest
1. Tell us a little about your background?
I am a financial advisor and CFA charterholder with over 10 years of experience in the financial industry. I am also a licensed Real Estate Broker, an MBA graduate (UCLA Anderson), but most importantly, a mother of three. Having spent significant time (and money) acquiring my own education, I believe strongly in the power and value of education for my children. But as a hardworking student who had to take out (and then pay off) over $150,000 in student debt to finance my education, I am focused on making it possible for my kids to achieve their educational goals without being burdened by a crushing amount of student debt.
2. What made you decide to leave a successful corporate career and start your own business?
After working for four years as a Senior Relationship Specialist at the Capital Group/American Funds, the largest provider of 529 Education Savings plans in the country, I became convinced that it is absolutely critical for parents to begin saving, as early as possible, for their children’s education. The process for doing so in America is unfortunately very confusing, and quite difficult, for all but the wealthiest parents — those who have access to the advice and guidance of high-cost, personalized financial advisors.
I had my “Aha!” moment while talking with three friends on how to save for their children’s education. I explained how 529 Education Saving plans are undoubtedly the best way to save for their children’s education, and then sent them the 12 page form so that they could enroll. None of them completed the form. When I checked in with them I got a similar response from each of them. As users of Venmo, PayPal, and other financial apps for things like banking, they didn’t understand why they had to contend with such a laborious paper-based process. That’s when the light bulb went off — use technology to streamline the process and save time for both the families and the institutions working with them.
3. What was the genesis of the idea behind U-Nest?
I came to know the 529 process very intensely for close to four years at the Capital Group, and found it unnecessarily complex, even as a seasoned financial advisor. In addition to the hours of paperwork, there is little incentive for financial advisors to offer 529 plans because they tend to result in small account sizes — many advisors find it hard to weigh the time and effort against the reward they’d get in commission. U-Nest disrupts this model, offering a state plan that bypasses expensive advisor-sold plans. With the help of technology, and because U-Nest doesn’t take a commission based on account size, we’re able to charge the low, flat rate of $3/month. See graphic below for the difference in fee structure:
4. There are other savings apps out there. What makes U-Nest different?
There are a lot of savings apps out there – but U-Nest is the first and only mobile app to help parents set up a 529 College Savings Plan. The U-Nest app automatically transfers money each month from the parent’s bank account to their child’s plan. Parents can track their savings goals and progress through U-Nest’s app and parent portal. The app also lets parents adjust their monthly contribution and understand their predicted final savings amount given expected investment returns.
Each U-Nest account is optimized to ensure the funds are invested in the smartest possible way given the child’s age, when they expect to need the funds, and the expected risks and returns of stocks, bonds, and other investment vehicles. U-Nest is a fully accredited and registered Financial Advisor with the Securities and Exchange Commission and is backed by a team of experienced financial experts and advisors with decades of experience.
5. The cost of a college degree continues to climb. What advice do you have for a parent worried about how they will pay for their child's education?
With student loan debt reaching close to $1.5 trillion, parents need to start saving early for their children’s education. It is widely accepted by financial experts that 529 plans are the optimal way to save for education expenses due to their tax advantages and investment options. Yet 70% of people don’t know about 529 plans, and the process to choose the right option and set one up has historically been extremely complicated. My advice would be for parents to familiarize themselves with 529s, and set one up for each of their children as soon as possible. This is the beauty of U-Nest: what used to take hours of tedious paperwork and expensive meetings with financial advisors can now be done through the app in less than 5 minutes – and the process is entirely secure and paperless.
6. Anything else you would like our readers to know?
U-Nest combines the benefits of traditional 529 college savings plans with the simplicity and accessibility of a mobile app. Below are a few more key benefits that readers should know about using an app to manage their 529:
- Easily Set Up Personalized Goals – Establish your future goal with U-Nest’s college calculator and choose an amount that is right for you based on your monthly contribution, your child’s age, and the type of school you expect them to attend.
- It’s Simple and Fast – View account balance, change contribution plans and manage transactions at the touch of a button.
- It’s Affordable – Start investing in your child’s future with as little as $25/ month. U-Nest makes saving easier for every income group.
- It’s Secure – U-Nest uses bank-level security and the strongest browser encryption to keep your sensitive financial data safe. U-Nest is registered with Securities and Exchange Commission and is fully regulated.
- Create a Personalized Investment Portfolio – U-Nest picks the best investment portfolio for your child based on your child’s age and when they will need the money for their education. Your portfolio is constantly optimized to achieve the best asset allocation as your child becomes older.
- Professionally Managed Investments – All your investments are managed by Invesco, one of the best investment management firms in the United States, with over 80 years of experience with over $988 billions in assets under management.
As you can see from the interview, Ksenia has the knowledge and experience behind her but more importantly for me, she is in it for the right reasons. This is a company whose mission from the start is to provide parent's an easy and affordable way to save for their child's college education.
I wanted to learn more about how easy U-Nest is to use and was able to connect with a parent that actually uses the app. Here is my interview with Jarred Herman.
Interview with Jarred Herman- A Parent that saves for college with U-Nest
So why U-Nest over the other college savings options?
We setup a 529 with Schwab before our first child was born and we were surprised by the amount of paperwork involved in setting up an account. We also felt a little overwhelmed and it was a confusing process working with a large brokerage company.
We knew U-Nest was different from the very start. Setting up the account was done on my cell phone in minutes and was an intuitive and easy process. The college savings calculator showed me how much we could expect to pay for our child's college education and what we need to save each month. We particularly liked the set and forget contribution feature.
What are some of your favorite features of the U-Nest App?
The college savings calculator not only allows you to see what the cost of a college degree will be in the future, it shows you how your savings will grow to meet anticipated costs. You can monitor your account and bump up contributions to make sure you meet your goal. It's all done on your phone so it's really convenient.
Any advice for a Parent starting to save for a child's education?
Just start making contributions now, don't wait. The earlier you start saving the longer your money has to grow.
I can't agree more with you Jarred! What ever platform you choose, start investing any amount that you can in a 529 college savings account now. The longer you wait to get started, the less time your money will have to grow and the cost of a college degree will continue to rise.