Saving for your Child’s Education - Tips to Get Started
May 19, 2007
Welcome Moms! Please register as a user and feel free to submit your posts and comments often! We are link friendly and super excited about what you have to say!
The cost of a good college education is expensive these days. Students have to rely more heavily on loans from banking institutions to finance their education. But, there is something you can do, as a parent, to help your child along.
One key to saving for your child’s education is to start now. Even if your child is a toddler, it’s never too early. At the current rate of tuition increase, by the time your toddler is ready for college, the price per year for a private institution could be almost doubled.
Start with an educational savings plan. These are called 529 plans. Savings programs of this sort allow parents to set aside money for later use by their children. These funds are after-tax dollars, so there will be no cost to your child when the time comes to withdraw the money.
Each state has its own individual 529 plan. Check into the plan for your state to see what the requirements are. Also, there are other plans, like Upromise that offer tax benefits to you the parent. Make sure that you open a separate account for each child.
Put money into certificate of deposits (CD’s) at your local bank or credit union. A good idea is to take a portion of your income tax return each year and open a CD for each child. Choosing a five or ten year CD will give you the highest rate of interest. Since you are not looking to use the money any time soon, it is okay to choose a longer termed CD.
Purchase savings bonds. Whenever you have extra cash this can be done. Savings bonds are a great gift for children on their birthday or on holidays. Instead of asking for clothing or toys from relatives, ask for savings bonds to help fund their future education.
It’s not easy saving for college. If you have more than one child, saving becomes even more important. The more money that you can save, the more choices your child will have when choosing which school to apply to.
The money can be used for all college expenses. If your child gets a scholarship to attend a particular institution, they will still need incidentals. College plan funds can be used for books, equipment for classes, and graduate school. Your child will be free to pursue advanced education after college.
Saving for college is an investment in your child’s future. Don’t wait until the last minute to give this issue some thought. No matter what your income level, using even one of the suggestions above will help you have funds available when your son or daughter is ready for college.
Grab your Guide to Family Budgeting - Step-by-step guide to help you establish a workable budget.
Posted by admin | Filed Under Money & Finance, Parenting
Similar Posts
- Saving for College Education
- Child College Savings-Setting yours up Right
- Do We Need A Family Budget?
Comments
(Join our Ad Spinner)
How to finally bring a hot meal to the table every night of the week - even if you work full time or think you have the craziest schedule on earth!