Saving Money for College the Right Way
Graduation season is upon us, and I bet you might be wondering how you will ever be able to afford college for your young ones someday. Instead of waiting until your child is in high school, start saving as early as possible.
Start by setting your savings goal
Assess what type of school you see your child attending in the future. Is it an in-state school, an out-of-state school, or a private school? This is important to recognize in setting your goal, as the price of each type of school can vary widely. Do some research and see what a reasonable saving goal might be for you and your family.
Add a monthly cut to your budget
Reaching your goal may seem difficult if you aren’t precise in your budgeting. Review your saving goal and divide it by the number of years you have until your little one is going to be off to college. Then divide that number by 12 months to see the amount you should be budgeting. This will keep you accountable and knowledgeable of where you are on your savings timeline.
Know your financial aid options
While each student is unique in their skillset and background, there are still endless financial aid opportunities for everyone to pursue. Start by understanding your household income and how that reflects on a FAFSA form. FAFSA financial aid rewards vary from household to household, so it is important to explore other opportunities as well. Take time to research scholarship offers for your child’s intended school as well as opportunities that may be offered from your high school.
Don’t compromise your retirement for college savings
29% of parents with children under the age of 18 who have student debt of their own, choose to prioritize saving for their child’s education rather than their own retirement. While we can understand that a parent wants to keep the burden of student debt off their children, we also must understand that student loans are available if your child needs them. Student loans are a better option than you having to borrow for your expenses during retirement.
