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Working mom shares strategies to save for college

November 16, 2010

By Kelli Warner,
KMTR-TV

Morning News anchor, Springfield

My 12-year-old son came to me the other day and informed me that he’s decided to go to college at Stanford University.  It’s a significant declaration, considering he’s never dropped the names of specific schools he’s thought about attending.  After I thought about it for a few minutes, my calm, rational mother’s thinking produced a few questions.

First: Why Stanford?  (He is from Oregon Duck lineage, after all).  Second: You don’t even know for sure what you want to study, how do you know Stanford is the school for you? And third, although I didn’t say this one out loud: How could you possibly go to school that far away from your mother?

But I’m going to be honest with you.  The very first thing I thought of the moment he made his grand announcement was this: Do you have any idea what four years at Stanford is going to COST?  We’ve been saving for college, but we’ve never really ball-parked what we’re working towards.  I recently tapped into an online college calculator.  What I found had me breathing into a paper bag.   Six years to graduation… four years at an out-of-state public university… take into account inflation… (gulp) $132,000.  I’d like to tell you a car and a condo were included, but sadly no.  That’s just tuition and fees.

If you’re in the same boat, there are some things you can do to find and save cash for college.  I spoke with a certified financial planner who told me that if your child is five or more years away from college–you’ve got time to save.  But she warns not to risk your own retirement to pay for tuition.  You know how flight attendants say in case of an emergency; put your oxygen mask on first before you assist your child?  She says treat your retirement the same way.  It’s the key to your future.  Tuition comes second.

She also told me that the most popular option among parents is a 529 college savings plan.  It’s an investment account in which all the growth is tax free and other people, like grandparents, can contribute to it.  Plus, if the child named on the account decides not to go to college, the money can be used for another child, or for you, to go to school.   The key to this type of account is learning how to invest—advisors suggest going more high risk when your children are young; then moderate to conservative as they get closer to graduation.

Career counselors say your children should start looking for scholarships once they’re in high school, with four years or less to graduation.  I met a couple high school seniors who are currently on the hunt for scholarships.  They subscribe to websites that let them know when scholarships that might apply to them become available, and they spend hours in their school career center checking and rechecking what’s available.  They tell me persistence is the key.

Another way to save big for college is to have your teenager enroll in advanced placement courses while still in high school.  AP classes are actually one of the most under-utilized ways to save money before you ever set foot on a college campus.  For example, one of my local high schools currently offers 23 duel credit AP classes like chemistry and calculus.  Students earn high school credit as well as college credits without having to pay for them.  The vice principal says some kids are graduating with as many as 70 college credits to their name.  That could potentially save them as much as $7,000 dollars in tuition.  That’s a big savings.

There are also a couple online rewards programs which can help you earn money for college when you spend money on other items.  When you register your debit card at Upromise.com and babymint.com, anywhere from 1% to 25% of qualifying purchases will go into your account.  And here’s the bonus: friends and family can contribute their rewards to you.

After I did some research, I felt a little better about my son’s Stanford announcement.  Turns out, he really only wants to go there because two of his buddies said they wanted to go there.  Go figure.  I’m guessing his college plans may change over the next six years.   But I’m still expecting them to cost a pretty penny.

  
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Discuss this article

Betsy November 16, 2010

Stanford is $132,000! How can any family afford to pay that?

Simpson November 16, 2010

The AP classes are the solutions that people just let skip by. Think about it for a moment, you child’s senior year and summers or a time when they coast when instead they should be excelling. Think college now and not later. Get as many of these classes as you can. Best advice.

noname November 16, 2010

Start paying now, or you will pay later.

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