You might have noticed that a few things have changed around the Money for College Project.
I am super excited about the changes, and I am very confident that they will allow me to do a better job of giving you information that you want and can actually use. These changes will also allow me to reach the goals that my wife and I have set for our family. And there goes the cat out of the bag….sort of. My wife and I have made the decision to adopt a child.
We have decided to pursue a domestic adoption rather than ever trying to have our own children. This is a personal decision, and one we are completely confident in and passionate about(even though we understand it is not exactly conventional). We are excited to one day be able to explain to our child that adoption was our first choice and not a backup plan. I hope to post much more on adoption in the future, complete with updates as we move through the process. Please let me know if you are specifically interested in this topic, because I could write for days on the subject!
So, as any good soon-to-be parent does, I am going into preparation mode. My wife is nesting (a term I just recently learned about, and am already scared of) which leaves me to worry about our finances and our child’s future.
That brings me back to the changes here at the Money for College Project. In reality, these changes are more of a re-focusing. To be honest, they are actually going to focus this blog, for the first time, into something concrete. I am changing the mission statement of this blog to reflect my goal of funding my child’s future. I want you to join me in my journey of figuring out how to save for college, and give my child the future that he/she deserves.
I know that children are the center of life for many people, and we all struggle with the decisions we make for our children. One of these big decisions is how to save money to help them get through college, help them pay for their wedding, help them financially as they transition into adulthood (I know this assumes a lot about you and your convictions on what parents should do for their children, and I will get into that more later). Money for College Project is not going to turn into a parenting blog, but it will have an emphasis on how families affect your finances, and how to live life to the fullest with your family.
To accomplish this, my wife and I’s finances need to be in perfect working order so we can provide the support for our child that we will need to. We also will need to have the ability to save/invest for our child’s education and for their general care.
I began Money for College Project with the goal of helping you understand financial aid and learn about personal finance. In my search to meet that goal I realized that for many people, simply getting their kids to college age is a milestone. Preparing to finance a college education really begins as early an infancy. Just as a long time horizon is critical to saving for your retirement, it is just as critical in saving for your child’s college education.
I promise you that you will see much more about my re-focused mission in the weeks, months and years to come. However, in the mean time please check out some samples of the awesome material I have been working on and am really excited to share with you!
The Complete Guide to 529 Plans
The 529 College Savings Plan. Considered by many financial professionals to be the best financial vehicle to save for your child’s college education. There are distinct tax advantages that work similar to an IRA, where you can defer post-tax or pre-tax income into your child’s 529 plan. Regular contributions made into a 529 College Savings Plan can add up to a large nest egg that could fund your child’s entire college education. You have 18 years to save, and the sooner you start, the more you will be able to save through the power of compound interest and tax advantages.
Pre-Paid College Tuition Plans
In addition to 529 College Savings Plans, many states have unveiled pre-paid tuition plans. Pre-paid plans differ from a 529 in that instead of investing money in a volatile stock market, you can lock in your tuition at today’s rates by buying tuition credits. If tuition increases over the next 18 years (which of course it will), the credits you buy will still be accepted. There are some strict rules with pre-paid plans and they also are much more beneficial to students who stay in their home states where the credits were purchased.
UPromise 529 College Savings Plan
We’ve all seen the commercials and see the signs, but what can UPromise really do to fund your child’s education? You can choose to funnel all of your savings from your Upromise account into a 529 College Savings Plan that can then be accessed to save for your child’s college education. Just as any other 529 plan will work, the money deposited into your account will be invested in some form of security and will grow according to the performance of your investment decisions. You can earn Upromise rewards at most major stores across the nation and especially from purchasing items online through the Upromise store.
Reinvest Your Previous Childcare Expenses
Many of us spend a lot of money to put our children in daycare while we work. This is certainly not a bad decision, but it can be an expensive one. Once your child goes off to elementary school however, this expense seems to float away. A great tool to work into your budget it to take the expense that you had spent on child care expenses and funnel those funds into an investment vehicle on behalf of your child. Your could invest in a pre-paid tuition account or a 529 College Savings Plan. Even if you begin when your child is 5 years old and going off to Kindergarten, you will still have 13 years of investment growth.