Even if your children are relatively young, it is better to start preparing for college financial planning sooner rather than later. Once you've started a savings plan, it's much easier to discuss the logistical and financial aspects of college with your child, and you'll have a clearer picture of how you can help.
Here are five tips for planning for college with your children:
Discuss career goals
Sit down with your children and go over what it is they're interested in and how choosing a college can affect their career path. It is recommended to begin discussing career and college goals as early as age 12. To keep the choice realistic, have your children go online, research possible careers and write an essay about what they've learned. Information can include salary, the level of higher education they need and how long their program typically lasts. The earlier you begin having these discussions with your children, the better prepared they will be.
Request a tour of a local college campus to help your children get an idea of what college is like and how much it will cost. This can help them decide whether they're more interested in a private or public school, which can have a great impact on tuition costs and financial aid.
Talk to your child about how much money you estimate they'll need to attend college. It is important to involve your children in the initial financial planning stages so they will understand the types of sacrifices that are being made for them to achieve their education and career goals.
Visit the bank
Take your children to your local bank or credit union and open up a savings account for them. Explain to your children that they will be considered the vice president of the savings account, which will aid in their college financial planning. Set a certain percentage of each paycheck that will go into the account from part-time jobs in order to encourage them to save money.
Review savings options
Along with your children, have a discussion with a banking representative about a 529 College Savings Plan and the tax benefits it offers. This plan helps you set aside funds specifically for your child's future college education.
Planning for college can be exciting for you and your children, so use these financial planning tips to develop your household strategy. If you need help getting started with financial planning, contact an Atlanta financial advisor.