Never too early
It’s no wonder parents-to-be are stressed about financing their child’s education. They hear nothing but horror stories about how much it will cost to pay for college. Don’t believe the hype. Try these tips for stress-free savings.
• Save found money. Put your annual raise into an account for your child, recommends Jacqueline Williams, executive director at Ohio Tuition Trust Authority. The same applies to tax refunds, unexpected inheritances, and bonuses.
• Redirect old payments. Once you’ve paid off your car loan, start to put that money into a savings account—you’ll never even miss it.
• Automate it. Payroll deductions work wonders for people who spend their money the minute it hits their pockets.
• Smart gifts. “Instead of buying a toy for a birthday, get grandma to contribute to a 529 account.” Williams offers. “About half of the states offer an income state tax deduction for anyone who contributes—not just the account holder.”
• Don’t wait. Take advantage of compounding savings and watch it grow.
• Start small. Forego that occasional gourmet coffee or Friday night pizza and put away $25 a month.