Saving for College – 40 Tips for Real Families

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This is a sponsored post written by me on behalf of Navy Federal Credit Union. All opinions are 100% mine. Navy Federal Credit Union is federally insured by NCUA.

I’m sending my third child off to college next month. Over the years, we’ve figured out creative ways, in addition to traditional ideas, that really do work in saving for college. These are ideas anyone and everyone can use to save as much as possible for the investment of going to college.

blue graduation cap on top of diploma with cash fanned

Education is a core family value that has been passed down in my family for four generations. Each generation has sacrificed to give their children a better education than they received. My husband and I began saving for our children’s higher education five years before we had our first child. That’s how important saving for college is in my family.

Whether you’re starting to save before having children or it’s just a couple of years until you have to pay that first college bill, these ideas will work for you. The most important step is to start saving for college. Start saving as much as you can as early as you can.

With determination and discipline, it really is possible to save for college, and save significantly. Some of the tips we personally used are traditional ways to save and others are tricks we used to save even more for our three college funds.

College costs have more than doubled since 1980 and risen at twice the rate of inflation between 1985 and 2018. This means that saving for college is a serious, disciplined task. It is possible to do, but you have to be purposeful in your approach.

How do I start saving for college?

Everyone’s financial situation is different, but paying for college is most likely one of the largest expenses you’ll have in your life. For that reason, many parents do everything they can to help save for their child’s college expenses and set them up for financial success in the future.

infant in high chair with smiling parents

Start saving as soon as possible. Saving earlier rather than later allows you to harness the power of compound interest. Simply put, the interest on your investment earns interest. That means that you’re earning interest on money you didn’t have to put into the account. The earlier you start saving the more compound interest you’ll earn.

Set up automatic deductions from your paycheck to your college savings fund each month so you never forget and you don’t make excuses for not saving.

Use a college savings calculator to determine how much money you need to save based on your specific situation.

Make learning, education and hard work a priority in your family. Your child should understand from a young age that they are expected to contribute to going to college by doing their best in school and by saving their own money for college. If you’re saving money for your child’s college education, they should also be investing in their own future.

Educate yourself on current college costs for your state schools, local universities and the average national cost. Be sure to include the costs of college tuition, room and board, books, fees and travel.

Research the current requirements and limitations of different college savings plans and choose the one that works best for you.

  • Coverdale Education Savings Accounts – A tax advantaged account established for qualified education expenses for a designated beneficiary.
  • A savings plan for college with tax advantages. There are two types of 529 Plans available:
    • Savings plan
    • Prepaid college tuition

Select a reputable savings institution, such as Navy Federal Credit Union (where I’ve been a member for years), to place your child’s college savings fund.

Have your child open their own savings account for college. They should put earnings from jobs and significant portions of monetary gifts into this account. In addition to saving for college, this teaches children about money, the importance of working for a goal and doing their best at school so their savings will go farther.

Roth IRA – Once you’ve had a Roth IRA for 5 years or more, you can withdraw funds to pay for qualified educational expenses without a penalty.

Carefully consider the pros and cons of student loans and the impact of student loan debt. Thoroughly research student loan options so you can choose the best option for your financial situation and your future.

Research federal student aid early so you understand the options. Apply for financial aid as soon as you are able because it can be a cumbersome process. Carefully review the offers received from different colleges because each offer will be different.

Saving for College

graduation ceremony with graduates in red cap and gowns

General Savings Tips

When your child receives a monetary gift as an infant or toddler, place much of that amount in your child’s college savings account. Weigh the power of compound interest on saving for college now versus items you are considering purchasing with the gift.

Your child should take as many advanced placement (AP) and dual enrollment (college classes offered in high school) classes as possible. These classes can translate into college credits for you child. With enough of these credits, your child could possibly graduate early, saving a semester or year of tuition expense.

Consider whether your child should start at your local community college and transfer to a four-year school later. Some states have special programs to encourage students to start at community college and then transfer to public university. This can save you significantly on tuition, fees, room and board.

When your child is in middle school or early in high school, look for scholarship opportunities. There are scholarships for all kinds of situations, including from many elementary and middle school PTAs and local organizations. Create a list of potential scholarships and be aware of what requirements are associated with each scholarship so your child can prepare.

Consider whether a state school or a private school is the best option for your child. Public colleges often have lower costs for state residents. But there are very generous academic scholarships, including full-tuition academic scholarships, at many private colleges. Start doing your research early in high school and consider the in-state opportunities versus the private university opportunities for scholarships (not grants or loans).

Anytime you save $20 or more on sales or memberships, place the savings in your college fund.

As soon as your child begins to narrow down their interests, research the costs of that program of study. The fees associated with a degree can range widely depending on the degree. Knowing the expected costs will help you anticipate more accurately how much you need to save.

Only eat out when you have a coupon or on a deal day and save the difference for college.

I attended college on a military ROTC scholarship, as did my brother and husband. There are several ways that the military can help you pay for college:

Explore federal aid that your child may qualify for, including grants and work study. This information will assist you in planning for how much of the cost of college you’ll be expected to pay.

young girl and mother crafting with father looking over their shoulders

Tips to Save for College and Teach Your Child Responsibility

When your child is old enough to understand the idea of receiving gifts, place half of a monetary gift into savings for college. If you start with this practice from a young age, your child will never question it. It’s also a great opportunity to teach your child the importance of saving for college from a young age.

Have your child start earning money from the age of 11 or 12. They can pet sit, mow lawns, babysit or help neighbors with chores. Have them put half of their earnings in their college fund. This teaches your child to have a work ethic and the importance of saving for college.

When your child is in high school, especially during the summers, they should have a part-time job. At least half of their earnings should go into their college savings bank account.

Have a yard sale once a year or sell items online and put the earnings in your college fund. Encourage your child to declutter and work at the yard sale so that they are contributing to saving for their college fund.

Lifestyle Hacks to Save for College

Put any bonuses, winnings, or inheritances into the college fund. If you can’t deposit all, at least put half of the amount towards college.

Purchase infant and children’s clothing from consignment sales and yard sales. Young children outgrow clothing so quickly you can find almost new, and often new with the tags, clothing at sales. Put the difference between what you spent and what it would have cost new into the college fund.

Throw old fashioned at-home birthday parties each year and put the savings in your college fund. That results in 18 years of savings on birthday parties that can be invested in your child’s education and future.

Purchase used sports equipment, like bats, gloves and pads, and save the difference.

Always pay off your credit card in full each month. Choose a credit card with cash rewards and put that amount in the college fund.

Purchase a used or older model cell phone and save the difference between it and the newest model.

Reduce spending on extravagant high school senior year events and put that money in your college fund.

Take 10 minutes and calculate how much you spend each week on splurges. You can put that $50 to several hundred dollars a month into the college fund. Make your own coffee instead of going to the coffee shop, paint your own nails, bring your own food for lunch, clean your own house, eat out less often, and so on.

If you’re not using that gym membership, cancel it and put that amount into your college fund.

Purchase a used car rather than a new one and place the savings in the college savings fund.

blue graduation cap with cash fanned out

Save While in College

Attend college near home and live at home.

Take advantage of student discounts and put the savings in your college fund. This includes all student savings from elementary school through college.

Save money during college purchasing used books. And sell books back after using them.

If you have a meal plan, eat in the dining hall rather than paying extra to eat out.

Use coupons at the grocery store, at restaurants and when shopping online.

Take public or campus transportation whenever possible. Take advantage of student fare passes.

graduation ceremony with graduates in blue cap and gowns

Looking for more tips on paying for college?

Other college preparation ideas you might have missed

Be sure to pin these tips for saving for college so you can refer to them again over the years.

mother holding infant with father standing behind
chalk board with dollar signs and graduation cap on top
graduation ceremony with graduates in black cap and red gowns
See all my tips, ideas, printables and care packages in the table below.

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