Back-to-School Budgeting: Preparing for Education Expenses
New parents have a million things to think about when they welcome a little one to the world…from diapers to daycare. It may seem like college is a long way off for your little bundle of joy, but the truth is it’s never too early to start saving for your child’s education. At Brannen CPA Services, our goal is to help our clients find their strength in their numbers. Just like learning the ABCs, you have to start somewhere and the earlier you start preparing for education expenses the better. In this article we discuss how you can save for your child’s education with some back-to-school budgeting tips.
Start Early
The longer your money is invested for your child’s education, the more it can grow over time. Use the power of compound interest to your advantage and start saving as soon as you can!
Make it a Part of Your Budget
Having a budget gives you a clear idea of your financial situation. It also helps you define larger financial goals like saving for your child’s education. By making education savings a part of your budget, it also ensures that you will make regular contributions. This is a great way to help the fund grow steadily.
Get Support
Make saving for your child’s education a family affair! Involve family (and friends!) by encouraging contributions at significant milestones such as birthdays and holidays.
Beyond family support, there are also programs that help parents save for their child’s education. If your child was born in Maine, they are eligible for The Alfond Grant: a $500 grant for future college or training expenses from the Alfond Scholarship foundation.
There are also tax-advantaged savings plans such as Section 529 Plans that can help you save. Also known as “qualified tuition plans,” these are plans that are sponsored by states and educational institutions. You can learn more about 529 Plans in the U.S. Securities and Exchange’s Investor Bulletin.
Preparing for your child’s future education is an important financial goal. The earlier you can start the better, but it’s always a good time to start saving! If you have questions about saving for your child’s education, please give us a call at 207.271.9600. We’re here to help you thrive!