How Much Will I Need To Save To Pay For College?
College is a source of financial fear and trepidation for many young families. With the rising expenses and difficulty to obtain excellent financial aid, many wonder if and how they will ever afford the added expense, or even if the education is worth the financial burden. As a parent of two young children, I find myself often wondering how we will afford to put them through college, much less finance our own retirement.
How Much Does College Cost?
College costs are continuing to skyrocket, faster than the most people’s income could ever ckeep up with. For a public college, the average cost for all four years of just tuition and fees was at around $37,800 in 2013, which was up an additional 4.2% from the total cost in 2012. Imagine the expense of attending four years at a private university! I know several years ago I examined the cost of a local small private college, and they were asking a total of $29,000/year for each student. Comparatively, this school was considered a “less expensive” private school option.
How Will I Ever Afford To Pay For College?
Before you toss out the idea of college entirely, it’s worth considering the possibility of using an investment to help finance your child’s educational expense. For example, if your child goes to a university that costs around $15k per year, and if you factor in an increase of 6% per year, if a parent were to invest $4,200 when the child was five years old and saw an increase of 3% a year, that child would have at least a strong chance of having the money they need saved by the time the child reaches 18 years old. There are many investment options for college students, including a well balanced mixed portfolio, annuities, and many other options that could help make saving for college even easier.
Invest Now To Afford College Later
For more information on how to start saving early for your child’s education, and which investment options may benefit your college saving plan the most, speak to a Redhawk Financial Advisor near you. Your local Redhawk advisor can not only guide you on your steps towards saving for college, but also help you prepare for retirement and other major financial landmarks in your future. Don’t waste another day of financial unpreparedness. Take the time to get financial advice today while you still have plenty of time to get ahead with your savings.