Saving Money for Tuition Fees - The Complete Solution!
Parents should start saving up money for their child's college education right from the moment they are born.
With the speedy increase of tuition fees yearly, it is always better to opt for a safe financial plan which will help you in sending your kids to college without any difficulty, in the future.
Besides saving money, there are 3 top sources which will help your kids get through a college:
1. Scholarship grants
2. Part-time jobs
3. Financial aids
The above are relatively good alternative sources which will help your children get initiated on his/her college education.
Here are some tips as to how you can wisely spend your hard-earned bucks on your kid's college education:
1. Always the sooner, the better.
Begin to save money right from your child's birth.
To start off with, let the savings and investments be under your name.
Then later on, when your child turns 15, make a decision as to whether the account has to be transferred to his/her name. This will also provide you with minimal taxes.
However, you must be very careful while transferring account names.
It is ineffective in the future when you want financial aid because there are some states which require a turnover of funds when your child turns major.
And remember that in a matter of 10 to 15 years from today, tuition fees will be hiked to double or triple the present rates.
2. A trust fund can be established for your child.
It is a wise plan for the child's parents and relatives to invest in.
The trust fund is almost similar to the time-deposit from where money will be handed over to your kid after a period of time.
After the specified period of time, the fund will be received either as the total sum or on an installment basis.
While establishing a trust fund, you must check out on details like the withdrawal restrictions, interest rates and taxes.
Overall, you have to approximate the costs of tuition fees, books, dorm room and meals. You also have to approximate the costs of other expenses, if any.
Ensure that your money is invested in a wise manner as your kid grows.
At the time when there are just 2 or 3 years for your child to enter college, it is extremely important to "lock" a considerable amount of the trust fund by putting them into low risk bonds so as to make sure that you have enough to start his/her college education.
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Source by Abhishek Agarwal
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