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How To Save For Your Child’s College Education

August 12, 2016

Probably every parent out there would like their child to have a better life than their own. This is especially true when the parents never had the opportunity to go to college or university. Although most baby boomers got by just fine in the post war period when the economy was booming and there were lots of jobs, they still thought a college education was a good thing. The next generation was the generation X and they were not so lucky and had to survive through several recessions when jobs were very hard to come by. The generation X  saw a college education as being very important to rise above the competition in a tough job market. Finally we have the millennials who are in the ages from 18 to 34 right now and they also really value a college education, and are also having difficulty getting good jobs.

Child studying economicsThere are some people that say that a college education is overrated and in some cases they are correct. If a young person can land a high paying union job right out of high school, they will probably be better off over the course of their life than if they had declined that job and went to college. If that union job lasts for their entire working career, then they will get a pension and retire early with a good income. However, that scenario is increasingly rare since very few people are able to get a job like that out of high school. The more likely scenario would be that they drift from one low paying job to another and end up making a below average income for their whole life.

The best way to ensure that you make a nice income throughout your life is to get a college or university education. However, that is a very expensive process that can cost ten to twenty thousand dollars a year for tuition, room and board, and living expenses. This can leave many graduates with a hefty student loan when they are finished school, that they will be obligated to pay off for many years into their working careers. That is why it is so important to start saving for your child’s education as soon as possible. Some people even start before the child is even born, but that is only possible if you are making enough money to live on in the first place. When you are young and just starting out, it can be difficult to find any extra money at all, especially if you are also saving for your first house. Most people start saving for their child’s education once they enter kindergarten or elementary school, and that should give them enough time to have a sizable nest egg once the child graduates from high school.

Here is a good video that explains many ways to save money for your kids university or college education.