How to Start a College Fund in Someone's Memory
Losing a loved one is always difficult; knowing how to honor the legacy of someone who passed away can also bring its own difficulty. Should you volunteer your time? Should you honor them by making a donation to a cause they supported? Should you host annual events in their memory? There’s no one right answer.
One way you can honor the memory of someone you love and cherish is by setting up a college fund in their name or in remembrance of them. Starting a memorial college fund in someone's memory that benefits their children or grandchildren (or anyone else they cared about) is a beautiful and powerful way to honor their legacy and truly create a lasting impact.
What is a college fund?
A memorial college fund is a college fund that helps pay for the education of children or students who lost a parent, grandparent, aunt/uncle or other loved one. Starting a college fund in memory of someone who passed away is a great way to honor their legacy and memory. College funds are a wonderful way of passing along a person's values, passions, or financial goals in order to help younger generations receive better opportunities and make an impact themselves.
How do I set up a memorial scholarship fund?
Wondering to yourself "How do you start a memorial scholarship fund?" isn't uncommon after someone passes away. Starting up a memorial fund is as easy as setting up a fundraiser on Ever Loved and sharing it with your friends, family, and community. Once you’re ready, you can start looking into different types of accounts to invest the funds you’ve raised into. You can also open an account by visiting a local bank or credit union or you can choose to set up an account through an investment firm of some kind.
How to set up a scholarship/college fund in memory of someone
One way to provide support to the family and honor a loved one's memory is to start a college fund for their kids. A child education fund can ensure the family doesn't need to be burdened financially with providing a college fund for their loved one's kids. This can be a major financial and emotional relief to the family since, according to LendingPenguin, the average cost of tuition at a public 4-year school is $25,290 -- and that's for an in-state school.
How to start a memorial scholarship fund in memory of someone
If you're wondering how to set up a memorial scholarship fund, this next section is for you. To get started, you can easily set up a fundraiser on Ever Loved to start collecting contributions towards a college fund for the individual's children. A memorial fundraiser is a great first step since they're easy to set up, easy to use, and easy to share. The best part is -- you don't need a specific investment account or bank account ready to go when you set up the fundraiser. You can start collecting donations and getting the word out before you have a location to send the funds to. Once you're ready, you can connect a bank account and all donations that have been pledged will automatically deposit into whatever account you decide to connect.
Once you've set up your memorial fundraiser, you should consider the different types of accounts that can be set up specifically for a child education fund. There are a few options when it comes to starting a college fund for kids. A college fund will require setting up a bank or checking account. When setting up a memorial scholarship fund at a bank or other financial institution, you have a few options:
- The 529 plan. This plan is great for letting you avoid taxes, set up a fund for someone else’s child, and lets you invest in high-return investments. You’re also able to withdraw the funds tax-free. The downsides to this type of plan is that your investment choices are limited, there are penalties you need to be wary of, and fees can be high.
- A UGMA account. A Uniform Gift to Minors Act (UGMA) is a type of account that lets you own investments, mutual funds, and stocks. It’s also a type of custodial account, which means it’s for a child or minor. This type of account counts against you when applying for financial aid for a student, so it’s a bit less desirable if you’ll be relying on financial aid for assistance.
- A Coverdell Education Savings Account. This is a great option for those who are looking to contribute a smaller amount of funds, but it does require that you earn under a certain amount to contribute. This type of account lets funds grow tax-free, which can make it appealing, but it has a yearly limit of $2,000.
- An IRA account. You are able to use IRA accounts for certain college expenses so long as you have been making contributions for at least five years. This type of account is less useful for immediate use since you’d need to have been paying into it for five years in order to use the funds, but if you’re saving for the future, this is a helpful account to have.
For more information on which plan to choose, it’s best to consult a financial advisor or professional as your situation will vary.
Tax implications when setting up a scholarship fund in memory of someone
When it comes to the memorial scholarship fund set up, you'll want to consider meeting with a tax advisor or financial professional if you're worried about tax implications. Here are the IRS guidelines for starting a scholarship fund, if you'd like some information before getting started.
What would a college fund cover?
College is expensive -- and not just due to tuition. When setting up a college fund account, contributions towards the fund can be used for many different college-related expenses, including:
- Tuition
- Textbooks and other school supplies such as notebooks, pens, pencils, computers, desk accessories, etc.
- Equipment for dorm rooms (cooking ware, kitchen utensils, plates, cups, towels, lamps, etc.)
- Personal expenses (food, groceries, going out, toiletries, cosmetics, clothing)
- Transportation (especially if the student lives off campus)
- Room and board
- Other associated fees the university might charge
As you can imagine, all of these expenses add up. If a child has lost a parent (especially a parent that would've helped them cover these expenses during their time at school), starting up a college fund in that parent's memory can make a world of difference for the family while their child attends college.
How do scholarship funds work?
College funds lift the emotional and financial burden off of a family after they've lost a partner. Once a parent passes away, that household can oftentimes experience financial difficulty since it's up to one parent to provide for the family -- a job that used to be a two-person job. This is especially true if there are children who plan on going to college at some point. With the cost of college tuition being in the $20,000 range, it's no surprise that a family could use financial assistance when sending their kids to college. Starting a college fund in someone's memory allows you to:
- Provide financial support and reduce stress for the remaining parent
- Ensure the educational future of your loved one's children
- Reduce the amount of loans the children need to take out to pay for education
- Support the children in attending a program or college they may otherwise not have chosen due to financial constraints
- Honor the memory of the person who passed away by contributing to the future of their family
- Provide financial support for costs associated with going to school (living expenses, supplies, books, etc.)
No matter which reason stands out to you as most important, setting up a college fund in someone's memory is an excellent way to support the family after they've experienced a loss.
How to raise money for a scholarship fund
Once you're memorial fund is set up and you're ready to get started, there are a few tips for running a successful fundraiser:
- Share the memorial fundraiser with as many people as possible. This includes posting the link to the fundraiser on all social media platforms and asking friends and family to do the same.
- Consider sharing the memorial fundraiser link with local religious and community organizations that have their own networks to share the link with.
- Make sure the decedent's former employer is aware of the website in case coworkers want to make a supporting donation.
- Explain how the funds will be used, your reason for setting up the fund, and the goals you have for the fund clearly on the memorial website.
If you're wondering how to establish a memorial scholarship fund with a chosen college or institution that has their own methods of raising funds, it's worth connecting with the philanthropy department of the college to gain information on how you can start a memorial scholarship fund in your loved one's honor. Once the college provides you with information and steps, you can either collect the funds on your own memorial fundraising website on Ever Loved or simply leave a link to where loved one's can donate on the website.
Ready to start fundraising? Set up a memorial website and get started today. Ever Loved memorial websites make it simple and fast to start raising money for a college fund after someone has passed away.
