How To Save Money For College
According to College Board: average tuition fees + room and board fees:
- Private nonprofit colleges – $42,419/year!
- Public in-state colleges – $18,943/year!
So how do you start saving?
Even small amounts make a difference.
Save $100 a month at 5% interest rate, in 18 years, you’ll have more than $35,000!
You can choose from various accounts
- 529 Plans
A plan to help families set aside funds for future college costs
- Prepaid Plans
A type of 529 account that allows families to purchase tuition at today’s prices and redeem it in the future
- Coverdell Education Savings Account (ESA)
Allows families to make an annual non-deductible contributions
- Custodial Account
Set up by an adult for the benefit of a minor
- Roth IRA’s
You pay taxes on money going into your account, but all future withdrawals are tax-free