How to Plan For College Expenses and Save

Here are some general strategies to help in saving money for college or finding money to pay for college:

Consider the thirds rule. Estimate the cost of 4 years of college. Have the student borrow 1/3, save 1/3, and pay as you go 1/3.

Do not save college monies in your child’s name. 20% of a student’s assets are considered available for college costs, while only 6.4% of parents’ assets are considered available.

From two years before your child will attend college begin to consider how to make your assets look smaller. Defer raises and bonuses, and buy large items by January of your child’s junior year in high school.

Consider buying a house or a condo for your child to live in during the college years. You save on high college-town rent costs while building equity, and after your child graduates, you may use it as a rental property or as a retirement home.

Consolidate PLUS loans after the first two years of your child’s attending college. You’ll save ¼ % interest as the consolidated loans cap out at 8.25%.

Consider schools in Canada; they’re cheaper, as are colleges that have co-op programs which allow students to learn and earn while working. Public schools are cheaper than private schools. Remember, an undergraduate education is not as important as a graduate education. Save money for the bigger and better degree.

Talk with your child about not using a credit card and being money wise. Discuss:
- Buying used textbooks and reselling books. A great site to buy used textbooks at up to 90% off is Biblio.com . Bunches of Books also sells used textbooks at steep discount and their sister site, WeBuyTextbooks.com will buy them back after you have finished with them!
- Selling unnecessary things on eBay or Craigslist
- Using a Student Advantage Card that saves 50% on all manner of purchases from pizzas to computers, on hair cuts and on air plane tickets.