Will you be able to pay for College?
The cost of college tuition has been on a steady rise over the last few years will most likely continue. How much do you think college will cost when your kids are ready to go?
If you plan early on you can put away enough money to pay for or at least help with the costs of a college education.
CNN Money offers some tips on saving for you child's college education.
The sooner you start saving, the better.
Even modest savings can pack a punch if you give them enough time to grow. Investing just $100 a month for 18 years will yield $48,000, assuming an 8 percent average annual return.
Stocks are best for your college savings portfolio.
With tuition costs rising faster than inflation, a portfolio tilted toward stocks is the best way to build enough savings in the long term. As your child approaches college age, you can shelter your returns by switching more money into bonds and cash.
You don't have to save the entire cost of four years of college.
Federal, state, and private grants and loans can bridge the gap between your savings and tuition bills, even if you think you make too much to qualify.
With mutual funds, investing for college is simple.
Investing in mutual funds puts a professional in charge of your savings so that you don't have to watch the markets daily.
529 savings plans are a good way to save for college and they offer great tax breaks.Qualified withdrawals are now free of federal tax and most plans let you save between $100,000 and $270,000 per beneficiary. Plus, there are no income limitations or age restrictions, which means you can start a 529 no matter how much you make or how old your beneficiary is.
The bottom line is to have a plan and stick to it. Starting early will help you to better afford your child's college education.