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College Countdown: Setting Aside Funds Now For Your Baccalaureate Studies

filed: September 29, 2008

If you're two or more years away from attending college, there are several things you can do now to ensure that you'll have enough money later to pay for college. Quite frankly, the sooner that you begin to save money for higher education, the more money you'll have when you begin your freshmen year of college.

Time certainly can seem to be working against you, especially if you or your parents haven't saved much money thus far. But, setting aside even a modest amount of money on a regular basis can be beneficial, lessening the blow that you'll face later on.

The following are some tips to help you save for college as well as where to look for other assistance:

529 College Plans – Every state and the District of Columbia allows families to set aside money tax free in a special deposit account, money that can grow steadily. Certainly, if you have a longer time to save, you'll have more money saved. Yet, setting aside money monthly for two or more years can help you accumulate a tidy sum. Notably, friends and family members are allowed to contribute to your account too.

Family Gifts – Grandparents and other relatives can give as much as $12,000 annually tax free to you, monies which you can set aside in a special account for college funding. You don't pay tax on the funds received and your donor(s) are eligible to receive a federal tax deduction.

Work Part Time – If you're old enough to work and can balance your class load with part time employment, then a side job can bring in some money which you can save for college. Best of all, if you work for the right company while in high school, you may be eligible to receive a college scholarship which can be added to the money that you save. For example, some McDonald's franchises set aside money for their restaurant crew, funds which are made available to eligible applicants.

Investigate Free Money Offers Now – Tens of billions of dollars of grant money and college scholarship money is awarded annually through the Federal Pell Grant program as well as through thousands of foundations, corporations, and private parties in the form of college scholarships. Though you usually cannot apply for assistance until you've reached your senior year of high school, beginning your research now can pay off later. Ask parents and grandparents if their place of employment, church, civic group, or other organization offers scholarship money to their relatives. Be prepared to apply as soon as you become eligible to do so; apply often too – there usually isn't any limit to the number of scholarships you can receive.

Get High Grades – Perhaps the best way to “pay” for college is to be an outstanding student now. High grades and participating in select extracurricular activities can help you get noticed, especially when it comes time to apply to colleges. Many schools put a premium on applications received from gifted students and will make sure that you can spend your four years at that school without being unduly saddled with student debt later. If a well endowed college really wants you, they'll find a way to cover your costs.

Clearly, starting your savings regimen early will lead to more money later. Yet, if you're just a few years away from attending college, any amount you start to save now can help ease your financial burden later.

For More Information:

• FREE money options for undergraduates
• review the financial aid process