There are many different saving plans you can use to save up for your child's college education.  The earlier you start saving for your child, the more your money will work for you.  Here are a few basic guidelines on saving for college.

Why save for your child's college education?

Some parents believe that saving for their children's college education is unnecessary.  The basic idea behind this notion is that our child should work for what he or she wants.  There may be truth in this educational outlook, but who knows how difficult it might be for our kids to pay for their college education in eighteen years time?  Even today, many young parents are going to be paying their own college loans when their 6 month old baby goes to college! 

The best we can do as parents is to give them a head start by ensuring their higher education. Putting aside around $50 a month, in a good saving plan with reasonable interest, isn't as difficult as it might seem initially.

How much do I need to save?
College tuition is on the rise each year, whether in public or private colleges and universities.  In 2002-2003 the average cost of a year's tuition was:
Private college or university:  $27,677
Public college or university: $12,841 or $19,188 (for out of state students)

Studies show that parents aren't saving enough for their children's college education, or are unaware of how much they are saving since the college saving is separated form other saving accounts.  It is better saving something rather than nothing, but if you can, try to meet the expected expense.

According to financial aid companies, putting aside $50 each month at an interest rate of 7% from the day your child is born, may yield around $20,000 by the time your child is the right age for college. Unsurprisingly, the more you manage to put aside each month the more your money will grow (putting aside $200 each month can come up to $80,000).

Parents find it difficult to put aside $50 or $100 each month.  But if you make it a habit, by setting up an automatic deduction from your checking account, you will soon find that it isn't as difficult as it might seem.  

Saving for college is one of the most important ways to ensure your child's wellbeing in the future.  Another $100 expense each month may be difficult when struggling to pay the bills, but the reward is in providing a better future for your child.

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