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How to Maximize College Savings for Your Child

By Meaghan Montrose

When your son or daughter is getting ready to go to college it can be a very stressful time. Not only do you have to deal with “losing” your child, but the financial aspects can be quite overwhelming. If you wait until your child is a senior in high school, you are too late. The stress of the situation can be lessened if you have a good-sized nest egg saved up for college. Here are some tips to follow in order to maximize your savings for college.

1. Start as early as possible.

The sooner you start, the more you can save. Once your child is born (or even before), you should start thinking about college savings. It should become part of your monthly budget. With that said, don’t get discouraged if you haven’t started saving yet. It is never too late to start stashing away money.

2. Set up a college fund.

The specific type of account you choose will depend on the state you live in and your own personal financial circumstances. A 529 Education plan is a popular choice. Visit SavingForCollege.com for more information on this type of plan. Talk to a financial planner to determine the plan that is appropriate for your situation.

3. Make college savings a priority.

Think of your college fund as a mandatory contribution you must make each month. Do not consider college savings to be a last minute thought with whatever money you have leftover for the month. If you do this, the chances are there won’t be anything leftover. We tend to spend what we have available. If you make savings a priority, it won’t get left behind.

4. Get relatives involved.

As the saying goes “It takes a village”. Let Grandma, Grandpa, Aunts, Uncles, and family friends help contribute to the savings. For birthdays and holidays, suggest money, savings bonds, or college fund contributions instead of gifts. There are only so many toys that your child can play with, but a college education will last forever!

5. Get your child involved!

After all, this is for your son or daughter, not for you. From an early age is it a good practice to instill the idea of saving. Whether the savings are for a new video game, a car, or college, the practice of managing and saving money is a wonderful skill you can teach your child. Keep your child involved in the process of saving money for college. Require your son or daughter to contribute to their college fund from an allowance, gift money, or pay from work.

These are only a few tips to get you started on the right track. Though saving for your child’s college education may necessitate some sacrifices, the end result is worth it!
If you have any other tips or useful websites for college savings please leave a comment.

Topics: College Preparation and Advice, Money and Business Advice, Parenting | 4 Comments »

4 Responses to “How to Maximize College Savings for Your Child”

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