How to Save for Your Child’s College
One of the most significant events in one’s life is the birth of the child. It comes with so much joy, but it comes with a lot of different choices from a financial standpoint. In fact, we have a survival guide called “And Baby Makes Three,” where we go into a lot of the kind of tips that you need to know and execute on. Another topic within the survival guide is, it’s never too early to think about college, and there are a lot of ways to go ahead and save.
1. Set aside funds
When you’re sitting down considering those options, an advisor, RJ Patterson Group, can help you understand what those options are, one of which I think that people don’t consider, is that you can set aside funds in your accounts for college, which, in the event that your child receives a scholarship or potential financial aid, then that money that’s earmarked for their college can actually be put towards your retirement.
Setting up financial aid, when they graduate, you can help pay down that debt as well, so that’s one area you can work in.
2. Get grandparents involved with saving bonds
There’s also savings bonds that are available to buy now, and what I really like about this is, grandparents really want to get involved. So, I think talking to the grandparents early on. At every birthday party, some people bring money. That money can be put directly into their college savings account.
3. Buy stocks
You can buy stocks that can grow for 18 years, basically until they go to college, and then you could actually gift that securities to them at a cost that you paid for that stock.
4. Look into 529 plans and mutual funds with a financial advisor
Within the 529 space, there are a multitude of mutual funds that you can utilize. In fact, there are 50 different 529 plans, which are very confusing, which we can help you discern, which one would be best for you. It’s invaluable to have a financial advisor that you can really bounce these ideas off, and they can help educate you on all the different nuances that are available to you for funding college.
The birth of your child is so exciting and it’s such a wonderful time. This survival guide that we have, “And Baby Makes Three,” has a lot of valuable information and it kind of gets you started in all these different topics. I really encourage you to utilize a financial planner, a fiduciary actually, someone that puts your interests first and makes sure that they’re looking out for you. There’s a lot of different choices out there, and at RJ Patterson Group, we talk about it all the time. It’s live for today and save for tomorrow.
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