How To Save Money On Tuition

Posted by Bimbita on December-23-2011 under Save Money

Here are simple ways to save money on tuition. College tuition fee can be extremely expensive. For parents that are interested in saving for the college, planning is the key. According to the website, the average cost for college including the tuition fees is approximately $27,300 for 1 year. This data is valid for 2010-2011. The cost for individual colleges will vary and will also depend on whether the students are studying at public or private universities and whether they are resident of the state or from outside the state.

Initiating a 529 college savings plan

Parents can pay for tomorrow’s education in today’s cost is the basic premise of 529 college savings program. Therefore, investing in such plans is a great way of securing the future of the child. When the funds are withdrawn from this program, the Federal Government doesn’t charge any taxes. Therefore, this is a great form of investment that can be done today.

Also check out How to save money on bus tickets reviewed by us.

Purchasing U.S Savings Bond

The bonds can be purchased easily online. These are extremely safe investments, backed by the Federal Government. The only problem is that the returns are extremely low on the Bonds. What makes them an attractive investment option is the fact that they are exempt from the federal income tax, especially when they are used for making payments for the higher education of children.

Start a college fund

Before you start the college fund, estimate, whether you would be sending them to public or private universities. The difference between the tuition cost of private and public university is enormous. Once that has been decided, start saving for the college fund as soon as possible as the inflation can eat the savings that have been made.

There are many methods to start saving money. The first option is to open a savings account, but the interest rate on the savings account is extremely low and can’t keep up with the yearly inflation. Inflation is the devaluation of money. Stocks offer a high rate of interest; however, they can be extremely risky, especially in times of financial turmoil and general recession.

Specific IRA funds that are geared towards college education funds can be a great investment opportunity. These are tax-free options and extremely safe vehicle of saving for the college tuitions.

Whichever mechanism of deposit or fund that has been created, it’s very important to make regular deposits. Ensure that regular deposits are maintained with updated records.

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