Plan Ahead for Your Kids Education

Plan Ahead for Your Kids Education 1
Parents want the best for their kids and this often includes higher education. Sadly, many parents find themselves scrambling at the last minute to gather money for college. Those who plan ahead for their kids’ education are ready when the acceptance letter arrives and are able to be excited for their children instead of stressed. By researching colleges in Miami, you can quickly get an idea of just how much college will cost and what you need to save.

Why it’s Important to Plan Now

College isn’t just tuition. For most students there are living expenses, books and various fees. Parents are looking at thousands of dollars each school year for all expenses. Taking out a loan means interest, which adds to the cost of education. By creating a college savings plan now, you are able to build money over time instead of trying to gather funds during you child’s high school years or while they are applying for college. The earlier you start, the more interest you can gain on what you put into a savings plan.

Making it Financially Possible

Most families don’t have large amounts to put back for colleges in Miami each week or month. If you start early, you can actually put very small amounts back, such as 5% to 10% of each payday. You have several options to make those small contributions count. The most obvious option is a bank account that pays interest. These pay the lowest interest rates, however. A certificate of deposit (CD) or an investment trust pay quite a bit more interest and is a long-term investment. Another option is to meet with an investment planner to find safe ways to invest to build your college fund quicker.

When your child is born, many friends and family members tend to give monetary gifts. Place all monetary gifts in the college fund to build a larger base amount. During the first several years of your child’s life, monetary gifts are best used for this purpose and it allows others to contribute to the child’s future.

Questions to Ask

The cost of college today will not be the same 18 years from now. Ask a financial planner about the future costs of attending colleges in Miami. You need some idea of how much you need to save. The next question you need to ask is how much you can reasonably afford. The object of planning ahead is to avoid financial stress. Re-evaluate your contribution amount each time your financial situation changes.

Ask a financial planner about the best investment options. Understand any risks involved. If there is any real chance of losing your investment, it is not appropriate for your kid’s future. You should also ask questions about financial aid to understand what funds your child might be eligible for and what is required. This should be factored in to your college savings fund. Counselors at colleges in Miami are extremely helpful for guiding parents in this area.

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