Featured article: Avoiding the regret of debt

Featured article: Avoiding the regret of debt

February 6, 2026

No one wants debt. This was the top finding of the students and parents recently surveyed by the Education Trust of Alaska.

The Trust commissioned focus groups and a survey of current University of Alaska students, parents of University of Alaska students, and 8th graders to gain a better understanding of existing awareness about the Alaska Performance Scholarship, Alaska 529, and University of Alaska scholarships; their college planning strategies; and motivations for attending the University of Alaska. Respondents in each group were clear: no one wants debt. They also shared that planning is overwhelming when the future seems so uncertain. Those who chose the University of Alaska were satisfied with their decision.

Here's a further, more detailed analysis:

Confusion and uncertainty can lead to decision paralysis: Investing in a 529 plan early can help alleviate future debt. However, awareness about how funds can be used, uncertainty about their child's interest in future education after high school, and the inability to save enough are barriers to planning or saving in advance. Many parent respondents said they avoid investing because they don't think it will yield enough to cover the costs of education and training. Parents are worried about the portability of 529 accounts if their child attends an out-of-state school, doesn't go to college, or pursues a trade.

The truth about modern 529 plans: 529 accounts have become increasingly flexible; now, qualifying expenses include trades, apprenticeships, vocational training, college, professional credentialing, and more. Every dollar saved is two dollars they won't have to pay back later, including interest, so any amount saved can help reduce future debt. 529s can be used at most colleges and universities nationally. Any earnings grow federal tax-free, and as long as the funds are used for the qualifying expenses, they remain tax-free. If the account has unused funds, a solution is available thanks to recently enacted legislation that allows for rollovers into Roth IRA accounts. Most families don't save for the full cost of attendance in- or out-of-state. Participants in Alaska's state-sponsored Alaska 529 education savings plan have an average account balance of just over $17,000. Investing in a 529 plan early can help alleviate future debt, but it is not a standalone option for financing education.

Current University of Alaska students expressed satisfaction with their decision to attend UA: Students who chose to attend a school in the University of Alaska system were primarily responsible for covering the costs of their college education, and debt avoidance was a major factor. The UA students were blown away by the diverse academic opportunities available to them in-state. Some respondents had applied to and were accepted to schools Outside. When they compared the costs of attending an out-of-state school with the options available in-state, it became clear that the financially prudent and responsible choice for them was to attend an in-state school. Students attending UA found that it was not only affordable but also that they had additional money on the table through the Alaska Performance Scholarship, because they had taken eligible classes in high school, met the minimum GPA requirement, and completed the FAFSA. Survey respondents indicated that they didn't realize there were so many scholarship options in Alaska. They wished they had paid attention to information about Alaska scholarships earlier in high school. The real financial pie has many pieces. At UA, that might include a 529 plan, federal aid, the Alaska Performance Scholarship, UA Scholars Award, and other scholarships available to students from all academic and economic backgrounds.

Parents face pressures, information gaps, and conflicting emotions in their efforts to support their students: In the survey, parents of 8th graders and current UA students said they want to help their child succeed, want to avoid debt, but expect the student to pay their own way for education and training after high school. Parents of current UA students felt a strong sense of pride in Alaska and hoped that their child would live and work in Alaska after college. During the college search process, they felt some peer pressure to send their child out of state, but felt satisfied with their child's decision to attend an in-state school. They wished they had learned earlier (in 8th grade) about Alaska-based scholarships, so they could have helped coach their child on high school course selection. When they were shown the Alaska Performance Scholarship planning worksheet available at acpe.alaska.gov, most didn't recall seeing it before, but thought it was the perfect planning tool.

Parents of 8th graders found the prospect of college planning, including the courses required to attain the Alaska Performance Scholarship, and the requirements of the UA Scholars Award, to be overwhelming. They did not feel ready to learn about these scholarship programs or college planning. Parents were primarily focused on helping their middle schooler navigate the early teenage years, feel connected to activities, and manage the stressors of middle school. They also expressed uncertainty about traditional college pathways, leaning more toward vocational training and trades.

The bottom line: Planning is key; however, it can be overwhelming, leading to decision paralysis. Seeking information and support starting in junior high and throughout high school is key to setting a student up for future success. Avoiding debt is doable. The numerous financial tools available in Alaska can help our kids start strong, debt-free, and equipped with the training and education needed to secure fulfilling Alaska jobs.

Lael M. Oldmixon, M.Ed., is the Executive Director of the Education Trust of Alaska. She is a parent of an 8th and 10th grader, and a long-time advocate of post-high school education and training. She has worked for the University of Alaska for nearly 20 years. Her goal is to help Alaska families understand the various strategies for making education and training after high school affordable and attainable.