Republican Congressman Rodney Davis and Democratic State Treasurer Michael Frerichs are barnstorming across Illinois Universities in a bipartisan effort to improve college savings programs.
Among the ideas the two promote is allowing employers to take a tax credit for up to five thousand dollars per worker per year used to pay off student debt.
This is similar to what employers already do for other workers taking continuing education.
At an Illinois State University Davis stop said there is a cost in tax receipts, but projected reductions in student loan defaults provide an offset.
"The numbers for just the 2012 class where they expect over 150,000 defaults. And just looking at that class and the expected defaults, they expect to save over four billion dollars," said Davis.
Other ideas include allowing 529 savings account money to be used for computer and internet access expenses, letting graduates use 529 money to pay off student debt, increasing a state credit for college savings plans, extending a program deadline in Illinois beyond 2020.
Democrat Frerichs praised a Davis backed federal measure to lower barriers to putting away money in 529 funds.
"If you help make it easier, greater incentive for employers to do this, then it makes our job easier to sell and market the savings plans. This is a benefit you can offer to employees that doesn't cost anything, that they can have automatic payroll deduction. It's the easiest way to do it," said Frerichs.
There are more than 400,000 529 accounts in Illinois with more than eight billion dollars saved for colleges, but that targets only a fraction of Illinois children under the age of 18.
Frerichs said there's one key to college savings.
"It's not just about putting money aside or saving it, it's the power of compound interest. And if you do that early then these dollars will grow," said Frerichs.
The average student debt on college graduation in Illinois is about 30,000 dollars.
