The continuous increase in college costs makes saving for college a challenge for most families.
The College Board, a New York–based nonprofit organization, reported the national average for full-time undergraduate charges for 2013 to 2014. According to their research:
The 2.9% increase in tuition and fees for in-state students at public four-year colleges and universities in 2013-14 followed increases of 4.5% in 2012-13 and 8.5% in 2011-12 (before adjusting for inflation) and was the smallest percentage increase in over 30 years.
When saving for college, keep in mind that many students take more than four years to earn a bachelor’s degree.
Although daunting, it is possible to save and pay for your child’s/children’s college education… if you start saving early and wisely.
AOG Wealth Management, a Reston wealth management company, shares some smart strategies to save for college expenses:
Knowing how much money you need to accrue can make saving for college tuition a disheartening task. If you start early, however, you can put away small amounts of money regularly and you may end up with a decent fund when it’s time for your child to head off to college. Through the power of compounding, small, consistent savings can add up to a sizeable fund over long periods of time.
Start a Portfolio
You can keep up with increasing college costs by starting a portfolio directed toward stocks. As your child’s college years approach, you may want to switch more money into cash and bonds.
Utilize 529 Plans
Known as a tax-advantaged savings plan, a 529 plan encourages you to save for college. You can choose from two kinds of 529 plans: a college savings plan and a prepaid tuition plan. A college savings allows you to contribute money and have that money grow tax free. A prepaid tuition plan allows you to lock in the current fees at eligible private and public universities and colleges.
Find Savings Opportunities Such as Consolidating Your Insurance Providers
Many families often overlook their insurance coverage. To save on costs for extra money to put away for a college fund, think about consolidating your insurance. If you use one carrier for your home, auto, and other coverage, you may receive better rates and discounts.
Starting a college fund doesn’t have to be difficult—and you don’t have to stick to one plan. Let our Nova wealth management experts help you develop a strategy that will allow you to save for your child’s college education adequately.
With years of experience in the industry, we at AOG Wealth Management can suggest effective investment options that fit your saving style. Call us or fill out our contact form for more information on our services and receive a complimentary consultation.
(Article Excerpt from Average Published Undergraduate Charges by Sector, 2013-14, The College Board, n.d.)