It’s never too early to start saving money for your child’s future college costs! In fact, you should start saving as early as possible.
We know you want your child to go far in life. You want them to get the education they deserve. You want them to be prepared for their first real job. You want them to blossom in a lifelong career.
To accomplish these things, your child will need to attend college. You know this. And we know that most of you have been stressing about high college costs since your child started crawling.
But don’t worry. You can take measures now to make sure you and your child are ready to take on those college costs.
Start Saving Early for College Costs
It’s never too early to start saving money for your child’s future college costs! In fact, you should start saving as early as possible.
According to Karen Blumenthal in her article “The New Student-Loan Math” on the Huffington Post:
“Saving $83.33 a month ($1,000 a year) in an investment account that returns 6% annually over 18 years would result in about $32,000 by high-school graduation, before taxes. While it won’t cover four years of tuition in 2031, it is a good start.”
In addition to your own savings, ask loved ones to chip in. They can contribute to your child’s college fund rather than purchasing gifts. The earlier you invest, the more time the money you save has to grow.
Teach Your Child Good Money Habits
One of the most important things you can do to prepare your child for handling the financial challenge of paying college costs is to teach them good money habits. Teach them how to save, how to track spending and how to budget.
To help teach your kids how to save and spend responsibly, start young. Use their allowance as a tool for teaching them how to handle their money. Help them set up a budget based on their allowance. Teach your kids to budget out the money they need for spending, and to save the rest.
Lifehacker points out some valuable lessons you can teach your kids about money:
- Saving money now means something in the future.
- There’s never enough money to buy everything you want. You have to prioritize.
- Sometimes you have to wait before you can have something you really want.
- Keeping track of your money gives you power.
- Talk to your children about finances early. They’ll be much more prepared to take on their student loan repayment if they have budgeting experience.
Find “Free” Money First
Encourage and help your children to find “free” money to contribute to covering college costs. Scholarships and fellowships will help your student fund school and don’t need repaid.
You don’t want your child to leave money on the table when it comes to financial aid. Find what scholarships are available to your child based on their desired major and interests – and apply for them!
See What Aid Colleges Have to Offer
Colleges with sky-high tuition may be frightening, but don’t write them off right away. Your child’s college of choice may offer academic scholarships that can help ease the burden of tuition.
Wait until your child hears back from the school’s financial aid office. The aid that your child’s college choices offer should play an important role when it’s time to commit to one school. Look at the whole package and decide what you and your child can reasonably afford.
At Red Kite, we know that college costs can be a bit scary. Prepare for your child’s education costs early on to make their student loan repayment less of a burden. And of course, we’re here to help. We’ll look for sources of free money for your children so they don’t have to rely as heavily on loans. Try us out today!