If sending your children to college is one of your main parental goals, then you likely know just how expensive it can be. In fact, the cost of tuition has increased a substantial amount over the last 30 years, which means saving money for college has become more important than ever. Because you run a homeschool program for your children, it's already clear that their education is very important to you. To ensure higher education is an option for them (and to minimize the number of student loans they have), consider these five tips for saving for college:
1. Begin saving as soon as possible
As you probably learned when you began setting money aside for retirement, the sooner you begin saving, the better. That's because compound interest helps your savings grow exponentially over the years. While it may seem like you're getting a little ahead of yourself, do your best to begin saving for college when your children are still very young.
2. Consider beginning a 529 savings plan
Many parents opt to set up a 529 savings plan, which is generally operated by your state of residence. Having a 529 savings plan makes you eligible for special tax benefits, and you'll earn interest, so it's a win-win. Plus, this money can be used for all college-related expenses no matter where your child decides to go to school - even if it's out of state.
3. Put money away every month
In addition to starting the saving process as early as possible, the real key to putting away money for college is consistency. No matter what you can afford - whether it's $25 or $100 - make sure you're setting aside money for your child's college fund every month.
4. Try playing the stock market
If you want to take a more aggressive approach - perhaps you got a late start on saving for college - you can always play the stock market. Of course, this is a bit riskier than a traditional savings plan, and requires you to watch the markets carefully. To make things easier on yourself, consider investing in a mutual fund and putting a professional in charge.
5. Encourage your teenager to contribute
Once your teenager is old enough to have a job, you can both contribute to his college savings. This could easily double the amount you put away each month, and he will benefit a great deal in the long run.