A parent once remarked to a friend, Of course two can live as cheaply as one. My wife and I live as cheaply as our daughter at university.
All joking aside, college planning is an issue that Americans must take very seriously these days. On average, college expenses have increased about 14% over the past 10 years.
The following investment plans are sponsored by the government and designed to help parents save for their children’s–or even their own–college education.
Coverdell ESA – (Education IRA)
The Education IRA is a good place to start, but you’ll have to do better than this.
State Prepaid Tuition Plan
Imagine buying groceries for retirement at today’s prices–that’s how this plan works.
State College Savings Plan
You get a lot of tax bang for your buck with this plan, plus the flexibility of going to college wherever you want.
The cost of rising tuition can send a chill through you bones. If you read the published rates for a private school in 2015 you are bound to see a number north of $30,000 a year.
Keep in mind though that the average student doesn’t pay near that amount. Public University costs are much cheaper and students living in state can get by paying less than $10,000 a year. An out of state student is looking at an average cost of $23,000 a year.
You can also look into grants and student loans which can help deflect the costs even more. With the typical college graduate earning a million dollars more in a lifetime, than those with a only a high school degree, it is well worth the investment.