A Six-Figure Investment: First, Figure Out Your Values and Needs.

Then You Can Help Your Kids.

As every parent knows, college isn’t cheap. Tuition plus room and board can range anywhere from a few thousand dollars to more than $35,000 a year. Multiply that by four, and add in an average 7% annual tuition increase and it’s easy to see why saving enough for college is one of the biggest concerns of my financial-planning clients.

This task is made doubly challenging by the simultaneous need to save for our own retirements. But it can be done!

Looking Back

First, let’s start with you. What values and experiences have shaped your views about higher education?

“Why does that matter?” you might wonder. “This is about my kids, not me.”

True enough. However, the first step to achieving any goal is to find a spark of inspiration to power your decisions and actions.

If you are dutifully adding money to a 529 fund for your children without giving any thought to what that will mean for them or for you, you don’t have a focus. And without a focus, you’re unlikely to meet your goal.

Looking Ahead

When our children are high school seniors, we’ll be, well, older. We’ll be closer to retirement and may be caring for aging parents and other, younger siblings. Middle age is often a time of self-evaluation that can include changing priorities and goals and increased anxiety about aging and financial security.

So where should you start? Before parents start socking away big bucks for their children’s college education, they should make sure they’re financially stable and on track to be able to retire. Students can always take out loans for college, but unfortunately, no one will loan you money to fund your retirement.


  • Encourage children to take care of their own needs: Keep some toys and art supplies on low shelves so kids can access them on their own instead of having to ask you, for example. Give age-appropriate responsibilities that foster confidence. Even kindergarteners can set the table or run the vacuum.
  • Get comfortable with your finances. Use a free budgeting tool like mint.com to see where your money goes. If you don’t have a budget, start using one.
  • Let your children see you handling money. Make it a point to pay cash occasionally and explain to your children how you earned the money you’re spending. Show them your checkbook or a credit card statement.
  • Give your children some opportunities to use money. An allowance teaches them how to budget and make choices about spending and saving. Letting them earn some money doing extra chores reinforces a connection between work and reward.
  • Don’t expect too much. Not every kid is a diligent saver. Blowing a few dollars on a junky toy is a valuable lesson. Better that they figure it out now.

This blog was excerpted from my ebook “Well-Schooled, How to Pay for College without Breaking the Bank of Mom and Dad.” Sign up here for your free copy and read more…

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