College is expensive. Whether you’re changing diapers or planning a graduation party for your senior, it weighs heavily on most parents’ minds. Here are some suggestions on how to save for and afford college – for both parents of littles and parents of teens!
For Parents of Young Children
1. You still have the advantage of time and compounding interest. Open an Educational Savings Account (ESA) and figure out what amount of money you can afford to deposit monthly. If you start good habits and pay this just like any other recurring bill, you’ll have a good chunk of money before you know it.
2. If you can’t afford to set aside money out of your regular monthly budget, turn college savings into a game. Learn to coupon or take advantage of other creative discount programs, and put whatever you’ve “saved” into their college savings.
3. For birthdays and Christmas, ask family to consider a deposit into your child’s college fund in lieu of gifts – or, in addition to a smaller gift. Kids have so many toys already, they won’t notice if their celebrations are a little more modest. It’s good for them, anyway.
4. Find ways to make extra money and earmark those dollars specifically for college savings. When you sell things on Craigslist, it goes to the college fund. If you babysit a friend’s child for money, it goes in the college fund. If you open an Etsy business or do a little freelancing on UpWork, that money goes in the college fund.
5. If you’re currently paying for childcare or private school tuition, think about this: You’re already accustomed to paying a hefty amount on a regular basis toward your child’s education. You might be equipped to do a monthly payment plan at your child’s college and just pay out of pocket as they go. The key, however, is to make sure that once you are no longer obligated to that monthly childcare payment that you don’t stretch your budget to incorporate it again. In fact, it wouldn’t hurt to just start putting that amount in savings each month so you’re not tempted to spend it.
For Parents of Teenagers
6. Look realistically at your budget and what you can afford. Talk openly with your teen about what you will be able to contribute, and let them know that they’ll be expected to cover the rest through work, their own savings, or student loans. Take the opportunity to teach them that ongoing debt is not a wise financial choice, and help them come up with a plan to work and save as much as they can during their summer break.
7. Help your teen evaluate multiple schools and review their costs. Encourage them to consider lower-cost options rather than higher-cost private schools. It may be difficult to have these conversations with your child, but you are showing them that adulthood means making hard decisions, and teaching them financial wisdom. The sooner you can have these conversations with your teen, the longer they will have to think about their options and prepare financially.
8. Apply for Financial Aid. Even if you don’t think you’ll qualify for federal aid, individual schools often require you to complete it in order to qualify for institutional aid. This has the potential to bring down the price of those high-cost private school your child might want to apply to. In fact, hardly anybody pays the “sticker price” so even if a college seems a little out of your reach financially, encourage your child to apply – just to see if it might be possible!
9. Encourage your child to apply for scholarships. Check out the great tips here!
10. Crowdsource the costs. Have you heard of TakesAVillage? It allows people to crowdsource their college tuition – but the money goes directly to the college (not the into the student’s pocket) to ensure the money is used exactly the way it’s intended.
For personal help with saving for college, check out Crown Financial Ministries. They can help you look at your financial circumstances, develop a plan to sufficiently save for college, and help give you peace of mind. Check out the FREE resources available at allmomdoes.com/money.
What are your best tips to save for college expenses?