Parent's guidance in shaping our future is very important. 97% of a group holding climate change jobs (a top-tier profession in terms of salaries) attribute their success to the proper guidance of their fathers and mothers.

Introduction
If you think that you have saved enough for your retirement, then you need to sit back and think once again especially if you are residing in the US. Have you saved enough for your child’s college education? If not, then probably the next biggest challenge after saving for your retirement is saving for your kid’s college education. For a child born in 2005 and entering college in 2023 fees can be anything around $95,000 for a decent indergraduate college in the US and best not to talk about the tuition fees in a private college!

Start saving early
Start saving now before the need arises to press the panic button. As a parent your role in the college planning process is very crucial. Not only could you help them decide on the right college and the right career moves, you could also look out for the best financial aids available for your child’s college education. So with the rising cost of education, the mantra is start saving early. Estimate how much you have to contribute for your child’s education and review different packages and policies available.

Cost of tuition fees
A survey conducted by the National Center for Education Statistics reveals that the average in-state tuition and fees for full-time undergraduate students in the US for 2005-06, before student financial aid was deducted, was $6,200 for a public two-year college and $5,206 for a four-year public university. The average cost for tuition and fees has nearly increased by 51%over the last 10 years for a four-year college program. If you want to gift your child the best education of the world, then here is your chance. A little saving from your side can make a lot of difference. If you start saving as little as $50, when your child is born, you can accumulate over $15, 000 in a span of 15 years at an interest of 7% per annum. Give your child financial lessons as part of the college planning process. Teach them to save from their pocket money as well.

Financial aids
You can assist your child in researching for various low-interest loans, grants and scholarships. The best place to visit for your child’s education is the Department of Education’s Federal Student Aid (FSA) program. Check out for the eligibility criteria for loans for your child. Factors that determine financial aid for your child include financial need, school diploma, satisfactory academic record, and US citizenship. If your child fulfills the eligibility conditions, you can deliberate on the various FSA programs like Grants, campus-based aid, Stafford Loans, Federal Work – Study, PLUS Loans, and PLUS Loans for graduates and professional students.

Comparative study of different loans and grants
It is very important for you to review the different loans and grants that your child can avail. Grants are aids which students don’t have to repay while loans have to be repaid with an interest. Work-study lets a student work and earn. It is very important for your child to learn about the various terms and conditions of the loans, methods of repayment and reapplying for FSA. Some parents prefer to pay for his or her child’s education using a home equity loan, since the interest is tax deductible. If you are using the home equity loan instead of a Federal P.L.U.S. Loan you must keep in mind the interest cap on the home equity loan, the liquidity available for emergencies, and the insurance factor as most home equity loans are not insured. Some parents consider cashing their investments than opting for a Federal P.LU.S. However, it is advisable to consider a few basic points before taking such a step. You should consider what kind of returns are you getting from the investments, do you have enough money to cover four years of college education or are you carrying any debt above 9%.

Online savings calculator
Using the online savings calculator to plan for your child’s savings and returns is a viable option. FinAid which is an online financial aid resource has on offer number online savings calculators for your benefit. The online savings calculators are the Savings Growth Projector, the Savings Plan Designer, the Annual Yeild Calculator, the Compound Interest Calculator and the Savings Plan Yeild calculator. The more frequently used popular calculators for calculation college costs are College Cost Projector, Savings Plan Designer (Flat Contribution), Expected Family Contribution and Financial Aid Calculator and Loan Calculator.

Coverdell Education Savings Account
Coverdell savings account is a very lucrative option for parents to save for their child’s future education mainly because of its tax-free income. Formerly known as Education IRA, in this scheme, families may deposit $2,000 per year for every child under the age of 18 years. Until distributed, earnings in this account will be tax-free. Another benefit of this account is that you can transfer it to the younger member of the family, once the child reaches the age of 30.

529 Plans
The 529 college savings plan is a very simple way to save for your kid’s education which provides even better benefits than the Coverdell Education Savings Account. 529 plan is a state operated education savings plan where families can set aside funds for future college education costs. If you satisfy the basic requirements, you are eligible for special tax benefits as well. Each state has at least one 529 plan available and it is up to you to use your discretion and make use of the best plan. There are many benefits of using this plan:

• You don’t have to pay taxes on the account’s earnings.
• You are in control of the account and not your child. So you can decide when to take the withdrawal and for what purpose.
• It is an easy and convenient way to save for college. All you have to do is to decide on the 529 plan you wish to use and complete a simple enrollment form and start making your contributions.
• Anyone can contribute to the account.
• If your child gets a scholarship, you can withdraw the unused money without paying any penalty.
• No income or age limits for the plan.

Private loans
You can even look for aid from other sources as well. Borrowing through credit cards is in fashion these days but think before you opt for them. Private loans have high rates of interest, so it should be treated as a last choice. Seek help from organizations that are connected with your child’s interest like the American Medical Association or the American Bar Association.
Help your child with all your wisdom and love for a bright and prosperous future!

To know how to Start Early, click here.