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If you're good at planning ahead, you may have thought about it before your child was even born, perhaps while you were shopping for a bassinet and teddy bears. At any rate, you probably started thinking about it when your child was very young. After all, it's one of the major responsibilities you face as a parent: your child's college education.
Personal growth and expanded horizons are reason enough to send a child to college, but there are more practical considerations, too. College graduates have more jobs to choose from, and they generally make more money than people who have a high school education. That makes a college education very important for your child's future.
Start Early, Early, Early
As a parent with an eye to the future you should start early to save for your child's college education. College costs have risen consistently for the past 10 years, and there's little reason to think this trend will reverse itself. Most cost estimates predict annual increases of 5%. What's more, many people take more than four years to finish college and some go on to postgraduate studies, so you may need to save even more.
To see just how expensive college is likely to become, take a look at the chart below.
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| School Year |
Public - 4 Year |
Private - 4 Year |
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| 1998-1999 |
10,458 |
22,533 |
| 1999-2000 |
10,981 |
23,660 |
| 2000-2001 |
11,530 |
24,843 |
| 2001-2002 |
12,107 |
26,085 |
| 2002-2003 |
12,712 |
27,389 |
| 2003-2004 |
13,348 |
28,758 |
| 2004-2005 |
14,015 |
30,196 |
| 2005-2006 |
14,716 |
31,706 |
| 2006-2007 |
15,452 |
33,291 |
| 2007-2008 |
16,225 |
34,956 |
| 2008-2009 |
17,036 |
36,704 |
| 2009-2010 |
17,888 |
38,539 |
| 2010-2011 |
18,782 |
40,466 |
| 2011-2012 |
19,721 |
42,489 |
| 2012-2013 |
20,707 |
44,613 |
| 2013-2014 |
21,742 |
46,844 |
| 2014-2015 |
22,829 |
49,186 |
| 2015-2016 |
23,970 |
51,645 |
| 2016-2017 |
24,090 |
54,227 |
Cost figures assume a 6% annual increase and use as a base The College Board 1996/1997 survey data for the current school year (tuition, room and board, transportation, books and other expenses). Source: The College Cost Book by The College Entrance Examination Board, New York.
A child born in 1999 will probably start college in the year 2017, when a private college education could cost $54,000 a year! Of course, these are only average estimates. If you have a specific school in mind, you may wish to contact the school- now and when the anticipated date draws closer -for information on tuition costs, how they have changed and the trend for future increases.
Clearly, it helps to begin saving early, preferably as soon as the child is born. The idea is to save or invest as much money as you can and pay taxes on as little as possible. It's like buying a house: the more you've saved ahead of time, the less you'll need to borrow. Set aside or invest as much as you can, even if it's just a small amount from every paycheck.
Increase your contributions to the fund as your salary increases. Add extra cash from raises or yearly bonuses, as well as some of the money your child receives as gifts. Money that comes unexpectedly and has not been budgeted will not be missed. Also, if your older child has a part-time job, encourage him or her to put some of those earnings aside for college.
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Estimated Cost of One Year of College - From the US Treas Dept 
