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Jared Young has been thinking about paying his children\u2019s college tuitions their whole lives. Longer than that, in fact.<\/p>\n
\u201cBefore they were born, we were thinking about it,\u201d says Young, 52, of Castalia, Ohio.<\/p>\n
With two children in college now and two children in high school, he and his wife Jody have their hands full in finding enough money for multiple college tuitions. The good news is they started saving when the children were babies.<\/p>\n
\u201cI set up a 529 plan for every one of them,\u201d Young says.<\/p>\n
Whether you started saving early like the Young family or are just getting started, here are 11 ways to manage multiple college tuition bills.<\/p>\n
1. Utilize 529 plans.<\/strong>\u00a0Looking for a place to stash your college savings for your children? A state-sponsored 529 college savings plan is a useful resource.<\/p>\n \u201cIn many cases, it\u2019s the best tool to save for college,\u201d says Ryan Derousseau, a certified financial planner at\u00a0United Financial Planning Group\u00a0in New York. \u201cThe money grows tax-free if you use it for qualified educational expenses.<\/p>\n \u201cAnd,\u201d he adds, \u201cwith new laws in place, if your kid decides against college or gets scholarships, a portion of the 529 funds can shift to a Roth (retirement-savings account)<\/a> for your kid or you can move the 529 to another family member who does want to go to college.\u201d<\/p>\n Learn more:<\/strong> The pros and cons of 529 savings plans, prepaid plans and how to decide<\/a><\/p>\n 2. Start early.<\/strong>\u00a0If you have many years before your children will be college students, make beneficial use of this time and start saving early.<\/p>\n \u201cBeginning a process of regularly contributing to your kids\u2019 education, through a 529 plan for example, is ideal when they are born. This allows investments to grow over time,\u201d says Ryan Johnson, founder and financial planner at Hundred Financial Planning, which is set to launch in Grand Rapids, Michigan, in early 2024.<\/p>\n But not all families will be able to start this early.<\/p>\n \u201cThis is not always a reality for some families, as they have less disposable income when (children) are younger,\u201d Johnson says. The natural starting point is\u2026as soon as you\u2019re able.<\/p>\n Turning a wage increase into an opportunity to save, as opposed to increasing your lifestyle, is a great strategy, he adds.<\/p>\n 3. Get the family involved in paying for college.\u00a0<\/strong>Grandparents, aunts, uncles and cousins and family friends may all wish to contribute to your children\u2019s college educations. Ask them and allow them to participate.<\/p>\n \u201cHave open conversations with grandparents and others who are willing to help early in your child\u2019s life,\u201d says Vida Jatulis, a Certified Financial Planner with\u00a0MainStreet Financial Planning\u00a0in Westlake Village, California.<\/p>\n Learn more:<\/strong> Why grandparents should set up 529 college savings plans<\/a><\/p>\n 4. Be realistic about how much you are able to pay.\u00a0<\/strong>College is expensive and paying all four years of tuition for two or three children may not be feasible. Be honest and upfront with your children about this possibility.<\/p>\n \u201cI have a client couple that has three kids in college. They were very clear with their kids that they would pay for the first year of state tuition. After that, the kids will have to fund their college through loans or work,\u201d Derousseau says. \u201cThe kids have clear expectations while the parents are living up to a promise that they can financially keep. It\u2019s not going to pay the full tuition, but it will go a long way to reducing the kids\u2019 college costs.\u201d<\/p>\n 5. Be smart with your college savings budget.\u00a0<\/strong>Money can be incredibly tight when you have two or three students in college. Keep a close watch on your budget.<\/p>\n \u201cWhen you have multiple kids in college at once, there will be years when college costs overlap and expenses are really high. These lumpy expenses can wreak havoc on a budget!\u201d Jatulis says. \u201cCreate a college funding strategy that will consider this and strive to even out demands on your budget. For example, it may make sense to use your cash flow when you have one in college, and delay use of grandparent funds\/529 Plans until years when you have multiple kids in college.\u201d<\/p>\n 6. Go to low-cost community college for two years.\u00a0<\/strong>Rather than attend pricey four-year colleges, opt for less-expensive community colleges for the first two years of your children\u2019s college educations. Doing so will help to slash tuition costs.<\/p>\n \u201cSince the first couple of years of college are focused on completing general education course requirements, it can save a tremendous amount of money to start at a community college and then transfer to the college of choice,\u201d Jatulis says.<\/p>\n 7. Think about state colleges.\u00a0<\/strong>Another way to reduce multiple, hefty college tuition bills is to attend lower-cost state colleges and universities.<\/p>\n \u201cExpecting to save for three kids going to Ivy league schools is expecting a lot. Instead, try to save enough to afford state schools,\u201d Derousseau says. \u201cIf your child prefers a private school, then you have some funds to help while they can use other resources to pay for the difference. It will give them ownership over their college decision as well.\u201d<\/p>\n 8. Add in travel expenses.\u00a0<\/strong>If your children are interested in out-of-state colleges, be aware that your 529 college savings plan cannot be used for travel expenses to and from college.<\/p>\n \u201c<\/strong>Travel is not an eligible 529 Plan expense, so if your kids are going to go out- of- state to school, this is an expense that you will have to cover with cash flow or other savings,\u201d Jatulis says.<\/p>\n 9. Apply for grants and scholarships.<\/strong>\u00a0A great way to lower college tuition costs is for your children to be awarded grants and scholarships.<\/p>\n \u201cEncourage your kids to research grants\/scholarships. There are many programs out there. Most folks don\u2019t take the time to look into the vast opportunities for funding,\u201d says Brandon Gregg, a Certified Financial Planner at\u00a0BBK Wealth Management\u00a0in Lafayette, Indiana.<\/p>\n Plus:<\/strong> Desperate parents will pay top dollar to lower the price of college<\/a><\/p>\n 10. Ask your children to help save for college.<\/strong>\u00a0Involve your children in saving for their college educations. A part-time or summer job while still in high school is a good place to start. Similar opportunities may be available when they start college.<\/p>\n \u201cEncourage your kids to save. This could be a terrific opportunity for kids to learn the value of saving and the value of working,\u201d<\/a> Gregg says.<\/p>\n 11. Look for ways to get college credits early.<\/strong>\u00a0Ohio high-school students, for example, can earn high school and college credits simultaneously through the state\u2019s\u00a0College Credit Plus<\/a>\u00a0program. It lets them enroll in both community college and university courses \u2014 and it\u2019s free if you attend a public college or university in Ohio.<\/p>\n \u201cFor us, this was a real game-changer,\u201d Young says. Through the program, one of his sons earned 65 college credit hours by the time he graduated from high school. \u201cHe had half of his college already paid for,\u201d he adds.<\/p>\n The Young family will have the financial challenge of multiple college tuitions for quite some time. To get through it, Young reminds himself of two things:<\/p>\n \u201cSave and pray.\u201d<\/p>\n Lucy Lazarony\u00a0is a freelance journalist living in South Florida who writes about personal finances, the arts and nonprofits. Her writing Is featured on Next Avenue, Bankrate, MoneyRates.com, MSN and the National Endowment for Financial Education. She previously worked as a staff writer at Bankrate.\u00a0<\/em><\/p>\n This article is reprinted by permission from\u00a0<\/em>NextAvenue.org<\/em><\/a>, \u00a92024 Twin Cities Public Television, Inc. All rights reserved.<\/em><\/p>\nWhen to start? As soon as you can<\/strong><\/h2>\n
Manage your kids\u2019 expectations<\/strong><\/h2>\n
Consider alternatives for a year or two<\/strong><\/h2>\n
Have your children contribute<\/strong><\/h2>\n
Get a head start on earning credits<\/strong><\/h2>\n