Millennials certainly have a bad rap, often touted as self-entitled and lazy. However, according to a new study, they are proving to be the best generation at saving money — particularly saving for their own children’s college education.

The latest “College Savings Indicator” study, sponsored by Fidelity Investments and the Massachusetts Educational Financing Authority (MEFA), found that Massachusetts Millennial parents (whom they categorize as those born between 1981 and 1997) appear to be particularly determined to help their children avoid significant student loan debt, and are adopting smart savings habits early.

The study spanned three generations — Boomers (ages 51-65), Gen X (34-50), and Millennials (18-34) — and found that across these three age groups:

• 71% of parents have started saving for their children’s college education.
• 67% of parents are saving monthly, putting away a median amount of $250 per month in 2014.
• 53% of parents saving for college report they have a financial plan in place to help them reach their college savings goals.
• 37% of families are investing in 529 college savings plans, 90% of which have either increased their savings or continued to save at the same rate over the past 12 months.

MEFA Executive Director Thomas Graf said results of the study, now in its ninth year, were shocking: “We used to have to convince people to save for college. Now, as we can see from the study, people are doing just that.”

Millennials Are Savers
Millennials are living with more debt than any generation before them.

“This is the first significant generation to have debt that has inhibited their lives,” Graf said.

Much like their great-grandparents learned how to be frugal with food after living through the Great Depression, it appears as if Millennials have learned to be prudent with their money, at least when it comes to future higher education costs. According to the study,

• 37% of Millennial parents graduated with student loan debt, averaging $29,000.
• 70% of Millennial parents who graduated with student debt are still paying back their loans.
• 82% of Millennials agree that their own student loan debt is motivating them to help their kids save more for college.

A 2014 White House report, “15 Economic Facts About Millennials,” prepared by The Council of Economic Advisers, reports that Millennials are now the largest, most diverse generation in the United States. One of the most significant markers for Millennials is that they have come of age during one of the most difficult economic times in U.S. history: the 2008 recession.

The White House report states that the oldest of the Millennial generation were 27 when the recession began. While unemployment surged and people struggled to find and keep jobs, younger Millennials were about to enter college and had to make tough decisions about whether they could afford to attend. Those who did are now burdened with enormous amounts of student debt, a fact reinforced by the Fidelity survey, which states nearly three-quarters are still paying back those loans.

College Savings Sees All-Time High
According to the College Savings Indicator, of the Massachusetts Millennial parents surveyed, 68% have started saving for their children’s college education and 52% have a financial plan in place to help them reach those goals.

The study reports that on average, Millennial parents started saving for their oldest child’s college education when the child was 4.6 years old, and more than twice as many Millennial parents (13%) started saving before their child turned 1, compared to Gen X parents at 5%. Millennial parents also plan to cover more of their children’s college costs (71%) than either previous generation of parents: Gen X (59%) or Boomer (59%).

So, what is motivating Millennials to save so aggressively? One theory: the generation is in so much debt themselves they don’t want their children to suffer the same fate. Or, perhaps, the options for saving have simply become easier.

Elizabeth A., of Worcester, is a Millennial in her early 30s with two small children. She is still paying down her student debt and will be for another five years — much like many of her friends. While her parents weren’t able to pay for her education, she hopes to be able to help pay at least some of her children’s. However, with a mortgage, saving for retirement, and general life expenses, saving for college isn’t really a priority.

“We opened a U.Fund account when our oldest was born,” she said. “The money comes out automatically, so we don’t even notice it. When our other daughter was born, we upped the amount we put in. We don’t really have any goals or anything, it was just easy to open an account and make the automatic payments.”

The U.Fund is MEFA’s 529 college investing plan that began in 1999 and is managed by Fidelity. The money can be used at any accredited college, and last April, the Senate Finance Committee passed a bill allowing the money to be used to purchase computers intended for use at college.

While Elizabeth is saving for her children’s college education, she believes it’s still not enough. Due to rising tuition costs, she doesn’t think she could possibly eliminate all of her children’s future student debt.

It’s Never Too Late
One of the biggest misconceptions regarding saving for college is the assumption that if parents save a lot of money for college, their child will be less likely to receive financial aid.

“The financial aid formula is largely income-driven,” MEFA’s Graf said. “You won’t be penalized if you save too much.” Therefore, even if a family builds up a large 529 account, their child could still receive financial aid.

“It’s best to start early. Even if you have a child in high school, you can open a [529] account and start putting money away,” Graf said. “They can use that money to pay for laptops or side costs. Any amount takes the burden off them.”

Parents of younger children should consider opening a 529 college savings account by the time the child is 6, he said: “With the cost of tuition rising each year, families can’t wait to start saving.”

One suggestion: When children start school and daycare expenses are eliminated, parents should consider rolling some of that former daycare money into a college savings account.

“There is an aspirational quality to putting any amount aside for your child’s education,” Graf said. “It raises the consciousness of the child that you, the parent, value education.” He noted that according to a study done by Washington University in St. Louis, children whose parents saved a minimum of $500 for education are 2.5 times more likely to enroll in, and graduate from, college than children with no account.

Saving for college is at an all-time high, according to the 9th Annual College Savings Indicator Study, sponsored by Fidelity Investments and the Massachusetts Educational Financing Authority.

• 71% of parents have started saving.
• 67% of parents are saving monthly, putting away a median amount of $250 per month in 2014.
• 53% of parents saving for college report they have a financial plan in place to help them reach their college savings goals.
• 37% of families are investing in 529 college savings plans, 90% of which have either increased their savings or continued to save at the same rate over the past 12 months.