JB Pritzker, Governor, State of Illinois

Money Matters

Though financial aid is usually needed to help pay for college, there are many other ways you can make attending more affordable.


A great way to prepare for college is to start saving early, and to set specific and realistic savings goals. There are several different types of savings plans available with banks, credit unions, brokers, insurance companies and mutual funds companies.

Click on the terms below to read more about each money-saving opportunity. Or you (and/or your parent, if you are a dependent student) can speak with a financial advisor for help deciding which options are right for you.

Savings Accounts

Simple to start and easy to use, this traditional savings method allows you to invest at your own pace. You may find the convenience of automatic deposit a good way to reinforce your own savings discipline. Interest rates vary, so shop around to find the best place for your account. Ready access to your money can be a mixed blessing—be aware of the temptations to "borrow" from a college savings account in other than extreme circumstances.

U.S. Savings Bonds

The familiar EE-bonds are guaranteed by the government and are virtually risk-free. They are available for as little as $25, often through payroll deduction plans, and never have a purchase or redemption charge. The interest rate paid on these bonds adjusts every six months in relation to the yield on federal five-year Treasury Bonds. Interest is paid at redemption. For EE-bonds purchased after 1989, within income limits, interest used for college expenses is free from federal tax.

Certificates of Deposit (CDs)

These are short-term investments—usually available without purchase fees or service charges—that guarantee a specific return at a specific time. Because CDs are federally insured, they are very low-risk investments. However, investors also usually pay significant penalties for withdrawing funds before the maturity date.

Mutual Funds

Investors' dollars are pooled to purchase a diversified collection of stocks and bonds (security portfolio) managed by financial professionals. The investment objectives of mutual funds are outlined in their prospectus, and range from high-risk speculation to lower-risk managed growth. Mutual funds are evaluated annually in several popular financial magazines.

Common Stock

Ranging from very high-risk "speculative" investments to lower risk "blue chip" issues, common stock offers potential income from both capital appreciation and dividend yield. Stock brokerage commissions vary widely between firms. Any stock can lose as well as gain value; investors should acknowledge their own level of comfort with that risk prior to purchase.

Corporate and Municipal Bonds

These fixed-income investments pay a predetermined rate of interest periodically and return principal at the maturity date. Bonds are rated by the financial markets; selecting bonds with high ratings that mature within seven years will minimize your risk.

Tax-Deferred Annuities

Investors deposit a lump sum with an insurance company and accumulate interest at a competitive fixed or variable rate.

Variable Life Insurance

The investor's premium is professionally managed to purchase stocks, bonds, money market portfolios or other investments.

529 College Savings Programs vs. 529 College Prepaid Programs

One of the ways to save for college is with a section 529 college savings plan, such as Bright Start®. Savings plans allow you to put away money for the future, while earning money over time through interest. This is different from a 529 prepaid tuition program such as the College Illinois!® Prepaid Tuition Program, which allows you to prepay for future tuition at current plan rates. College Illinois! enrollment has remained closed since 2017, as ISAC has engaged with legislators and the Governor’s office to help define proposals to address the Program’s unfunded liability. The Program continues to operate as usual for our current contract holders, with no change in benefit payments, customer service, or plan administration. Visit the College Illinois! Program Update page for current program information.

College Savings Bonds

In the past, the State of Illinois periodically offered college savings bonds that are zero-coupon bonds (instead of paying periodic interest, these bonds offer a fixed-cash payment at maturity).

No Illinois College Savings Bonds have been sold since the fall of 2002. Should the Governor's Office of Management and Budget announce a future sale of Illinois College Saving Bonds, this page will be updated.

Illinois state law prohibits exempting moneys held in college savings bonds from calculation of financial aid eligibility. Therefore, those moneys will count as assets in determining a student's eligibility for state and federal financial assistance.

For information about Illinois College Savings Bonds, refer to the Illinois State Treasurer College Savings Bond Payments page.

In prior years, beneficiaries of Illinois College Savings Bonds who met all eligibility requirements could apply to receive funds from the College Savings Bonds Bonus Incentive Grant (BIG) Program. No funds have been appropriated for the BIG Program for several years. If program funds are appropriated in future years, this website will be updated accordingly.

Other Options

Even if you (or your parent, if you are a dependent student) don't own it outright, your home may provide another source of funds for education financing through a loan or line of credit based on home equity; interest rates are competitive and the interest is tax deductible. Such loans may be a good choice, particularly if property in your area is expected to appreciate in value.


In order to save money, you must first have money. Now is a perfect time to jump into the workforce. Getting and keeping a job not only helps you earn money, but also teaches you a lot about responsibility, areas that might interest you in the future, business skills and more. You’ll be amazed how much you can learn while working. And the experience you get during your job(s) can help you when you’re looking to start your career after college.


Being in college can be advantageous when it comes to your taxes. Check out the IRS website for more information about tax benefits for education.

Credit Cards

Another source of “money” that can help you during college is a credit card. A credit card is ideal in emergency situations when you don’t have cash at the time you absolutely need it. However, a credit card can be dangerous to use, as interest is usually very high, and keeping a balance on a card could lead to financial trouble in the future. Research your options (and, if you are a dependent student, talk with your parents) before applying for and using a credit card. For more information about credit and credit cards, check out the University of Illinois Extension Credit Card Smarts Fact Sheets.