Five Simple Steps to Improve Your College Savings
- Organize a budget. Determine how much your family can contribute monthly to college savings. And make it a priority. As you line-item your monthly budget you will likely find expenses which you could eliminate or reduce, which are additional dollars that you can direct towards your college savings.
- Open a 529 college savings account. Saving through a 529 College Savings account is the best way to save for your child’s college, generally. These accounts provide tax benefits and investments like your 401k, which may provide substantial growth in your account. Also, relatives and friends can contribute to your child’s 529 account.
- Start Saving ASAP. The sooner you start saving for college, the better off you will be in the long-run. Whether your child was just born, or going to college in a few years, don’t put it off any longer. *For example, if you start saving $100 per month, you could potentially have $43,000 in your college savings account by the time they turn the age of 18.
- Familiarize yourself with the financial aid process, and scholarship opportunities. Don’t wait until the last second to get familiar with FASFA, or potential scholarship opportunities. You may be leaving free money on the table.
- Explore student loans. Student loans are almost always a part of a college students experience, and making sure you utilize student loans most efficiently may save you substantial money.
*Based on 18 years of saving $100 per month and receiving a 7% annual return on your investment.