By Jeana Lee Tahnk
Having kids is a major financial commitment. There are the dailynecessities such as food, clothes and shelter, of course, but longerterm, all the activities, lessons and (gulp!) college tuition can be ascary prospect.
Not to add more fear to the equation, but Mass Mutualestimates the cost of a college education to increase by 6 percentannually. That means tuition for a private college for the 2022-2023school year will be about $76,333. For one year. Double gulp!
Now before you go into panic mode and swear off any more children,there are lots of things you can do as a new parent (or even beforethose kids come) to start preparing. It's never too early to start.
The first thing we did was set up a 529 accountafter the birth of each of our kids. A 529 is a savings plan meantspecifically for higher education purposes and offers certain tax breaksthat other savings plans don't. We set up ours through our bank, soit's worth inquiring at your financial institution if one is offered.
The key to the 529, in my opinion, is putting money into theaccount as you would a 401k. Regularly and as much as you can afford toput aside. Even if it's $50 a month, every little bit helps.
Another way to start padding that financial nest egg is to askfamily members to contribute to your kids' college fund. Grandparents inparticular tend to be generous with grandkids, so you can request thatinstead of getting them expensive toys that your kids will lose interestin or clothes they'll soon outgrow, a savings bond or 529 contributionwould be a much more valuable-and valued-gift.
If you decide to sell any of your baby items, such as that crib yourbaby no longer needs (sniff), strollers or other gear, specifically putthat money aside and tuck it away into the account. $100 may not seemlike a lot, but any contribution here and there, plus interest over theyears, will add up.
Save, save, save is the name of the game when it comes to your kid'scollege education. If all else fails, pray for a scholarship.
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