College Savings: Never too Early or too Late

For those parents with young children, the idea of saving for college can seem like a far off and distant worry. Parents may suddenly find themselves only a year or two out from that first semester’s tuition bill with no college savings for their child, and no idea how to start saving.

If your child is still young, there are plenty of things you can do. The easiest thing to do is to set up a separate savings account for them. Even putting $50 per month into their account can lead to huge savings down the road: $10,800 in 18 years not including interest! A high-yielding interest account can give you more money in the bank, literally.


Another great option is a 529 College Savings Plan. There are two types- a prepaid plan and a savings plan. The major benefit to having a 529 Plan is that any money earned during your investment period is not subject to tax when used for qualified educational expenses like tuition, books, and room and board. If you are getting down to the wire in terms of your child’s enrollment into college, you can still invest in a 529 Plan as there are no age restrictions. However, each state is different so be sure to do your research before you buy.

Of course, there are other options to help you pay for your child’s college tuition other than forking over your own money. Scholarships, grants, loans, and financial aid are always options if you and your family qualify. Many banks are more lenient on college loans than other types of loans, and deferment until after graduation is usually available. There are thousands of scholarships and grants available to students as well. Research is key in finding one for which the students qualifies. It can often take some time to find and apply for all the different ones, so be sure to set aside some time to do that. However, there are scholarship matching sites that can help the student find the perfect fit for them.

Those of us that are military families often have special advantages when it comes to scholarships and grants. Some give special preference to children of military members while others are specifically for military children. There is also the option of the ever-popular GI Bill, from which the benefits can be transferred from the service member to his or her dependents. IF a service member decides not to use his or her GI Bill for themselves, they can transfer that money for their spouse or child to use on their education. This is a great option for many service member families, and one that can help to alleviate the stress of college tuition payments for many years.

There are some other, simple ways you can help save on college expenses both before and during your child’s college career that don’t have to do with large investments:
Work part-time: Have your high school student, and subsequent college student, work part-time and set aside some of that money for college expenses such as books, meal plans, living expenses, and well, beer (for the of-age college ones anyways!).

Take extra classes: Whether they have the option in high school through Advanced Placement or International Baccalaureate classes, or they take a course over-load while in college, taking extra classes can shorten the time you are in school. Many schools allow you to take a few extra credits with no extra expense every semester, but be sure to check your institution’s policies first. Also, be sure that the student can handle the extra courses- failing can be expensive!
Check out options for military: Some individual schools offer breaks for students of military families, whether it is lowered course costs, meal plan discounts, or book discounts. See what is available for your child through the school!

For more tips on how to save during the college years, be sure to check out It is a great site that has information on estimated college costs, 529 Plans for each state, and tips on how to start teaching your children about saving money at a young age!


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