Open a 529 Plan
With the cost of college education sky-rocketing these days, the thought of sending your children to school can be downright scary. However, if you approach it with proper planning, a long term savings horizon and take the time to open a 529 plan, you'll be well on your way to sending your children to the school of their dreams!
Instructions
1. Do your homework. It sounds kind of silly, right? After all you're not going to college, your child is. But there are over eighty different 529 plans available to people in the United States. So part of the decision is finding which is best for you. Usually it is one offered by your state. However, some states have very high minimums to get started. If you fall into a similar situation within your state, consider opening a 529 plan in a state that has no minimum.
2. Ask the experts. This is where having a broker or a certified financial planner may come in handy. In theory they should be able to cut to the chase and help you decide which 529 plan is best for you. However, they only make commission if you open a plan through them. So feel free to get multiple opinions, it will cost you nothing up front!
3. Open your plan. Once you've selected the plan that best suits your needs, go ahead and enroll!
4. Contribute early and often. When your child is born, the thought of paying for college education seems so far away that many of us neglect it, as other things always seem more important at the time. But even if you just contribute $10 a week, that's $520 in the first year alone. That initial money, growing at a historically accurate interest rate will grow to $2250 by the time your child is ready for college. Not bad, for a little extra change. And imagine doing that every year!
5. Educate your children. When they are old enough, include them in the financial process of saving for college. Explain to them what you've done. Maybe they could even do odd jobs around the house and "earn" money to help contribute. Not only will you be teaching them, but when they have children they are more likely to start saving early for their kids as well.
Tags: your child, your children, children school, college education, sending your, sending your children