National College Funding Strategies will help you:
* Figure out how much college will cost
when your child is ready for college.
* Set up a college savings plan to reach your goals.
* Make sure your
savings are safe and guaranteed.
* Make sure your savings do not exclude you from any Financial Aid.
At National College Funding Strategies, Inc., we know what CPA's, attorneys, stock brokers, RIAs, CFPs, and Financial Advisors don't about how and where to save for college. College Planning is a specialized area, and just as you would go to a heart surgeon over a general practitioner for a heart surgery, you should go to a College Planning Specialist over a general financial advisor for your college savings needs. The wrong advice could cost you thousands of dollars in financial aid and lost principal.
According to the Bureau of Labor Statistics, the tuition component of the Consumer Price Index (CPI) increased by 8% per year, on
average, from 1979 to 2001. This means that children born today will face college costs that are 3 to 4 times current prices
by the time they matriculate.
Parents should expect to pay at least half to two-thirds of their children's
college costs through a combination of savings, current income, and loans. Gift aid from the government, the colleges and universities,
and private scholarships accounts for only about a third of total college costs.
Accordingly, it is very important that parents start saving for their children's education as soon as possible, even as early as the day the child is born. Time is one of your most valuable assets. The sooner you start saving for college, the more time your money will have to grow.
If you start saving early enough, even a modest weekly or monthly investment can grow to a significant college fund by the time the
child matriculates. For example, saving $50 a month from birth would yield about $20,000 by the time the child turns 17, assuming
a 7% return on investment. Saving $200 a month would yield almost $80,000.
It is less expensive to save for college than to borrow. Either way, you're setting aside a portion of your income to pay for college. But when you save, the money earns interest, while when you borrow, you're paying the interest. Paying for college before your child matriculates definitely costs much less than paying for college afterward. Saving $200 a month for ten years at 7% interest would yield $34,818.89. Borrowing the same amount at 6.8% interest with a ten year term would require payments of $400.70 a month. At 8.5% interest the payments increase to $431.70 a month. So if you elect to borrow instead of saving, you will be paying 1.7 to 5.6 times as much per month!
