If you’ve asked yourself how to save for your child’s college, you’re probably about to make one of the most important decisions of your life. And no, it’s not an exaggeration, since the decision between saving and not saving involves the future stability and well-being of your family.
Like you, most parents have high expectations about their children’s future; everyone expects a successful and bright future for them. Such is the optimism, that according to the HSBC report “The Value of Education”, 95% of parents interviewed have considered at some point giving their children graduate studies. The reality is that in order to achieve this, some sacrifices must be made and actions taken.
1. Do early planning
Imagine arriving at that moment where your child is ready to enter college, but for some reason you decided not to save for college since he or she was a child. In “The Value of Education”, we found that 39% of parents regretted not having started saving sooner and that 34% of them would have liked to set aside more money.
It is advisable to have an education savings plan from the time your children are young. Without a doubt, it is easier to promote 100% the capacities of a young person who will enter university to study the career of his or her preference; which, sometimes is not possible if you do not have the economic resources and you have to be satisfied with the school for which you have reached your parents.
2. Research the price of universities
It is a good idea to find out about tuition fees at different universities, as they vary depending on many factors. If your child is young, you won’t know what he or she will study in the future, but you can project which college you want your child to graduate from and get an idea of how much you want to save.
The truth is that there are also public universities of very good educational quality, with the added bonus that you don’t have to pay monthly tuition. In that case, you have to take into consideration other expenses, such as transportation, school supplies, books and lodging, if it is in another city.
3. Set an objective saving according to your budget
When there is balance everything is better and in finance even more applies. Only you know what your income and monthly expenses are; from a balance between those two elements, you will know your available budget that you can save for college.
It is a good practice that when making these calculations, you be realistic about the costs of your current lifestyle and leave a margin for unexpected life situations, whether they are called illnesses, accidents or loss of income.
Keep in mind the amount of time you have left before your child goes to college and don’t underestimate the current education costs, for example, if your child is already in school.