Saving for College
Education is an investment that pays a lifetime of dividends. Over a lifetime, a person with a bachelor's degree will earn on average $517,000 more than a person with no education beyond high school. Up front, however, the cost of college can loom as a significant financial challenge for most families. In fact, providing for a child's college education is one of the largest expenditures many families will ever face.
Financial aid (loans, grants, scholarships, work-study) is only part of the formula when it comes to paying for college since it does not usually cover all the costs of a university education. Furthermore, grant and loan programs can change over time in terms of eligibility and money available for distribution, and scholarships are not available to everyone. How much families can afford to save for college depends on their financial situation, but they need to do what they can and begin as early as possible.
To develop a successful savings strategy, families will need to know how much a UW education will cost. To do so, students and parents should estimate a budget that includes tuition and fees, books, transportation, housing, food, miscellaneous costs, and emergency expenses. Current tuition costs for UW campuses are available in the College Costs section.
Developing a savings plan is an important first step. It is important to save as much as circumstances allow, but any amount saved is a step in the right direction. Setting a savings goal and breaking it down into manageable installments is a good way to get started.
It is still vital to investigate all options and consult other resources that may offer assistance on how to set up a savings plan, such as the local bank, credit union, savings and loan, public library, or a financial planner. The following two sections list Web resources that offer assistance on starting a college savings plan.
- FinAid: A popular Web site with extensive and in-depth information about saving for college.
- College Cost Projector: The cost projector is meant to provide an estimate of what college will cost in the future. The projector also makes some assumptions about what the future holds for higher education.
- Savings Growth Projector: This site projects how much current savings will be worth over a given period of time with a specific interest rate.
- Yahoo Finance: Basic information and advice about how to start saving for college.
- College Savings Plans Network: Links to every state's 529 plan.
- EdVest Wisconsin: Wisconsin parents, grandparents, aunts, uncles, legal guardians, and trusts can purchase tuition units on behalf of a child beneficiary and apply them in the future toward undergraduate tuition at educational institutions nationwide.
- FinAid: This Web site has an exhaustive list of savings vehicles and in-depth analysis of each vehicle's impact on financial aid.
- Savingforcollege.com: Offers analysis of all 529 plans and gives users the ability to compare the plans.