Do we have any general tips for you regarding saving and planning for college? You bet we do. Here are a few:
- Don't assume your youngster will follow a traditional route. He may have no interest in a traditional college or university education, instead planning to make a career out of a trade. He may change his mind and attend college later -- or perhaps he's already planning to work for a few years between high school and college. If so, that's not necessarily a bad idea. Students who attend college slightly later than the average may take their studies more seriously.
- Involve your child in the financial planning process, as well as the college selection process. From a fairly early age, he might help by contributing to his college fund. If he's interested in expensive schools, plan a financing strategy together. Knowing how much college costs might provide some motivation to work harder in high school, increasing odds of earning scholarships.
- Don't neglect your own retirement needs. If you're saving for college expenses, it doesn't mean you should put off saving for your retirement for 10 or more years. If you neglect your retirement needs to provide for your children, they may end up providing for you, much more than you'd planned. Another related concern is that, when it comes time to apply for financial aid, any money that you've sheltered in IRS-sanctioned retirement funds (such as IRAs) isn't taken into account as assets tapable for college. At least that's how the rules work at the moment.
- Don't rule out financial aid. Many people assume that their incomes and/or assets will make their children ineligible for financial aid. Even children of people earning six-figure salaries can receive some financial aid. Financial aid is big business, with roughly $50 billion being awarded annually.
You'll find lots of additional tips on paying for college in our College Savings Center. Our Paying for College discussion board is a good place to ask questions you may have, and our book, The Motley Fool's Guide to Paying for School by Robert Brokamp, is also a handy resource.