Saving for College

by Candace Bahr and Ginita Wall, CPA, CFP

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How to Save Big Bucks on a College Education

The best thing you can do is start saving for college while your kids are in diapers. But it's never too late to begin. Even if you don't implement your strategy until your kids are in high school, you can make great strides toward meeting your savings goals. Here's how to get started.

  1. Start a Mother's In-Tuition notebook to get organized. Clip articles, begin to collect information, and make notes to yourself about what you have found. Include sections on how much college will cost, information on colleges, what scholarships are available, and financial aid.

  2. Figure out what college will cost. In 2003-2004, with the cost of tuition, fees, and room and board for four years at a private university averaging $108,000 and state school costs averaging $42,000 for four years, it's no wonder mothers are in a cold sweat. And when your preschooler is ready for college in 2021, the costs will have more than doubled (projections show $260,000 for private school and $100,000 for state schools).

  3. Do a budget to see what you'll be able to afford to pay each month. Perhaps you can cut back for a while in some areas to put every spare cent into your college fund. And don't forget, you don't have to save your entire college stash in advance. While junior is in college, you can devote part of your income each month to paying for college costs.

  4. Figure out what other sources you have to pay for education. Will your child be able to work part-time? Are grandparents able to help out? Is your child saving for college? Can you borrow from retirement plans or home equity? Is your child a star athlete or superior student who will qualify for scholarships and grants?

  5. Now figure out how much you need to set aside. Use the Save for College Calculator at VISA USA's education website Practical Money Skills. It's located on the bottom right of the page, along with other helpful calculators.

  6. Start stashing cash for college. Where do you put that cash? There's an alphabet soup of options available, such as IRAs, UGMAs, Coverdell ESAs, 529 plans, and Qualified US Savings bonds.

  7. Check out financial aid. Learn about financial aid through your school's financial aid office.
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Candace Bahr and Ginita Wall, CPA, CFP are co-authors of "It's More Than Money--It's Your Life! The New Money Club for Women" (John Wiley, January 2004) Visit them at or join the Money Club where you can explore the Education Planning Money Zone. Join with other parents and friends and use the Money Club resources to move forward in your journey. Amazing things happen in Money Clubs!

Take the Next Step

  • Upromise - Turn your everyday spending into college savings
  • Whether your child's in diapers or asking for the keys to the car, it's never too early or too late to start saving for college. So, start your Mother's In-Tuition notebook today and progress from there.

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