Choosing the right college fund for your child can be a daunting task, what with the numerous different types of college savings accounts each with its own set of stipulations. However, you can save yourself the dilemma by asking yourself some few simple questions. Ask yourself questions like how much money is available to you from your tight budget for making this saving?, how much will it take to get the kids through college?, what are the most favorable ways to invest into the college fund?, and many others.
Depending on the different benefits and features each account has to offer, the answers you get will help in arriving at the right decision. To save you the hustle, we recommend a fixed rate cash Isa account.
This will not only save you a considerable amount of money in the long run, but also dissuade you from spending the money on other needs. Many institutions offering this sort of account limit you to just one withdrawal every year.
In addition, the money deposited in your account will accrue a considerable amount of interest that will not be subject to tax.
Tips for Better Saving
The sooner you start saving the better. Given enough time to grow, even modest amounts can grow tremendously if you give them time.
As mentioned above, a fixed rate cash Isa account is a good place to begin. With more deposits being made and less, if possible no withdrawals, you can watch your kid’s college fund grow substantially by the year.
Operate on timelines and be consistent with your deposits. If possible set aside a certain amount every month to deposit into the college fund. You should also consider increasing the amount you put in whenever you get a raise.
Don’t chip into the college fund-it is tempting to use this money given that your kid is not going to college tomorrow so that you can settle other bills. Promising to reimburse into the account is easy, but this will set you back in terms of your savings’ goals.
Don’t Forget
You should consider getting out of debt yourself so that by the time your kids are going into college you will be financially stable.
Evaluate the estimated college costs in proportion to your current saving standards and this will forge the path unto how much you should put aside every month to attain this goal. Have you started saving yet?
I think the tip on getting out of debt before the kids go off to college is a good one, I cant imagine sending kids off to go to school and then not be able to support them, especially if there are extenuating circumstances. Have a great day!
If only my parents did this for me. I have paid my own way in school and that is fine. I just hope I have the money to pay for my kids to go to school. I am so bad at saving money.