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College Savings Tips for Parents Starting Late

Updated on July 6, 2013

Saving money for college is getting more expensive by the year. (Find out how much a school will cost here.) Not only is there the cost of tuition and mandatory fees, many people will also have to come up with living expenses like room, board, and transportation.

Getting an early start on saving money for college is very important. Unless a kid is a genius, there is a good possibility that they will have to come up with some, if not all, of their college education expenses. Those who have children who are about to embark on getting a higher education need to start saving money now if they have not done so.

Start A Savings Account

The cost of a "moderate" in-state college or university rose to over $22,000 in 2012-2013. That number promises to rise this coming year, as many states have already announced tuition increases.

Private colleges and universities usually cost much more than their state-funded competitors. A moderate budget at a private school rose to over $43,000 last year.

Of course, these expenses can be cut in a number of ways. There are scholarships for just about everything imaginable. Even if you are a descendant of parents from Djibouti and Uzbekistan, there is probably a scholarship for you (the problem is finding it). There are many scholarships for minorities, women, left-handed people, disabled people, non-traditional students, and many more. The best scholarships are usually reserved for really smart people.

Of course, not everyone can expect to pay most of their expenses via scholarships. Another way to pay for school is by part-time (or full-time) work during the college years. This is a better way to get school paid for than taking out six figures in loans and partying for four (or six or seven) years.

Parents who want to help out their kids who are about to embark on college will need to save a large sum of money, regardless of where the kids go to school. Those who had a plan from the day they found out they were about to have a child will be in the best situation. Those who waited until later will find that they have some making up to do.

Saving money for college can take quite a bit of time. Those who start late will need to get creative.
Saving money for college can take quite a bit of time. Those who start late will need to get creative. | Source

529 Plans

One of the more popular ways that parents can save money for college educations is the 529 Plan. These plans are sponsored by several states. In some instances, parents can lock in today's college costs for tomorrow's college education.

The stipulations of 529 plans can vary by state. Most plans allow parents to put their money into a managed mutual fund. This money can then grow tax-free until it is withdrawn. The requirements will vary widely by state, so parents should check into the requirements for their particular state. Many states will cut down state income tax liabilities for those who take advantage of these plans.

Get a Second Job

Those who have a job that only takes up 40 hours per week and still pays off their monthly budget can choose to get a second job for a day or two per week. Part-time jobs can usually pay off in thousands of dollars in additional income for a family. This money can then be sent to a college savings account that can earn a bit of interest before the kid needs to go to school.

Start a Side Business

This is a bit different than a part-time job. In the latter, people work for someone else. In a side business, all profit goes to the owner. One of the easiest ways to save money for college for a late-starting family is by going around to yard sales and getting deals on good merchandise. These goods can then be put on websites like eBay or Amazon and sold for a profit. Volume will usually be necessary to earn a substantial sum.

Other options are nearly limitless. Dog walking, house sitting, and other services like these can pay some money, and that money can go into a college fund. Those who are creative can come up with many ways to save money for their kids' college, even though they might have started late.

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    • cprice75 profile image
      Author

      cprice75 4 years ago from USA

      Largely gone are the days in which a family could get by and live a good life on one income. I've been working multiple jobs for about five years.

    • teaches12345 profile image

      Dianna Mendez 4 years ago

      Great advice for getting those kids to college and keeping them there. I believe these days parents do have to take on a second job. Also, the student themselves can help by taking on a part-time job for personal expenses. Well done!