Sending your child off to college once she graduates from high school is probably the most important and wise, decision you will ever make. With all great decisions, waiting to the last minute to begin preparation is a disaster waiting to happen. Buying a last minute plane ticket, or booking a hotel last minute is one thing, but sending your child away for presumably the next four or five years of her life, that takes a lot time and a lot of saved money. To ensure you have the money available to pay for your child’s college tuition, start a college fund, which not only allows you to save money, but you can earn interest on the money that you are saving.The full explanation can be found at http://www.foxbusiness.com/personal-finance/2012/05/16/three-financial-goals-that-trump-college-savings/
First, pick a few colleges and compare the cost of attendance. Although your child may be eligible for grants and scholarships, assume that he is not. You want to know how much money you will need to save, and since grants and scholarships can be denied, you don’t want your child’s dreams to attend college to be denied too. Next decide how you want to save the money. Putting the money in a shoebox in the back of your closet will not make any money for you. Consider an IRA, Individual Retirement Account, which allows you to put money up for a college fund, and you are not taxed on any interest your money accrues. Other options include setting up a personal savings account, where you can deposit money into each time you are paid, or with any extra money you receive. When your child receives money for birthdays and holidays, put that money into the savings account too. He may not understand why he cannot buy that video game with the money grandma gave him, but when he’s paying for his classes a decade later, he’s appreciate the investment. College funds also teach children about savings, which like a college degree, we all need to have.