When your children are growing up, college may seem ages away. After all, you have about 18 years before he or she enrolls in school. Still, there’s no better time than these years to start investing your money. And the earlier you start, the better chance you have of building enough assets to cover the cost of higher education. It’s important to talk to children about college and college savings so that they begin to understand what it means to plan ahead. That way, your child will not only appreciate what it takes to pay for school, but also recognize the importance of saving and investing as a family.
When someone contributes to your child’s investment accounts or donates a savings bond, you can explain—in basic terms—how each of these items works and how it can help meet costs later on. You can also encourage your child to contribute some birthday or allowance money to his or her education investment accounts each year.
If you anticipate that your savings will fall short of your child’s college costs, you should start exploring your financial aid options. Make sure your child submits schools’ financial aid applications along with his or her admissions applications well before the deadline. Inquire about local scholarship and grant opportunities at the high school guidance office. In January, be sure both you and your child begin gathering the materials needed to complete the FAFSA in time. Once your child starts receiving acceptance letters, approach schools’ financial aid offices for advice about how you might apply for other aid opportunities. Remember that the earlier your child submits aid applications and materials, the better chance he or she has of being offered financial aid.
Contributions from the book Guide to Saving for College in this press release are used with permission from Light Bulb Press.