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10 Ways to Start Saving for Your Children’s College Fund
Doesn’t it seem like it was just months ago when you brought your baby home from the hospital for the first time? Time sure flies when you’re having fun, and changing diapers, and trying to keep your sanity while parenting a houseful of children.
The odds are that you haven’t had a spare second to breathe, let alone give a second thought to setting up a college fund for your kids.
But if you take the time to prepare in advance, you’ll be well equipped to give your children the education they deserve by the time high school graduation rolls around – by using the following tips..
1. Calculate the cost. It’s important to crunch the numbers and figure out how much it will cost to send one child to a community college, state college, or a four-year university. Now multiply that amount by the number of children you have, and you’ll have a rough figure of how much you need to save to send your kids to college with a full ride.
2. Start a prepaid tuition plan. This is a type of investment account that will help you put money away to pay for future college tuition against today’s current prices. Depending on how much you’re able to save, you could pay for a complete education that your child can take advantage of in 18 years.
3. Try a 529 college savings plan. This is another investment account that will enable you to set aside extra money for your kids’ education that can accumulate tax-free.
4. Open an Education Savings Account: An ESA is another smart way to save far in advance for your child’s college education. An ESA is slightly different from a 529 plan because the money saved can be used for any type of education, not just college tuition.
5. Assess your monthly budget. If you can put aside even $50 a month toward a college fund for your kids, it will quickly add up 10 years down the road. The key is to stay consistent!
6. Pay off your debt completely. If you’re drowning in debt, it will be easy to continue to put off saving for your kids’ college education. As soon as you pay off your own student loans and get rid of high interest rates, you can tackle socking away extra cash for your children’s college tuition.
7. Open an extra savings account. At the very least, putting college money into a savings account that you and your spouse can’t touch will guarantee that it will stay there until your kids are ready to use it.
8. Make purchases using Upromise. Upromise is a subsidiary of Sallie Mae that rewards members with money to use for college when purchases are made at qualifying gas stations, restaurants, grocery stores, and online retailers.
9. Make an investment. If you want to grow the money that you’re saving for your child’s college tuition, consider investing it into a Roth IRA; the money can grow with interest until you’re ready to withdraw when your child is old enough to attend college.
10. Consider financial aid. Last but not least, when you save as much money as you can, you can always encourage your kids to apply for financial aid to fund the difference. Every little bit helps!
author bio
Bethany Ramos is a full-time freelance writer that co-owns her own e-commerce website , The Coffee Bump.
