College is quite expensive, we know. But did you know that saving money for college is one of the most important things you can do for your future? While college may seem far off if you’re young, starting to save whatever you can today allows you to pay for a good chunk of those college expenses in cash.
In this blog post, we’re going to discuss some of the incredible benefits of saving for college early as well as some strategies to start getting on the right track today. You will thank yourself later — when you graduate with less financial aid debt and more career options ahead of you.
The Rising Costs of College Tuition and Fees
College tuition costs have been increasing for decades. According to the College Board, average tuition and fees this year were over $11,260 for in-state students at public colleges and $39,400 at private colleges. These costs are rising much faster than inflation or family incomes.
The importance of planning ahead
The important thing is to start saving early and often. Even putting aside small amounts in a college fund each month can really add up over 5-10 years thanks to the power of compound interest. Investing in the stock market historically returns an average of 7% annually after inflation. With that, saving just $100 a month could grow into $6,000 or more for college by the time you’re ready to enroll.
While college costs sometimes seem intimidating, saving for your education is extremely important for your future success and financial security. With proper planning and discipline, you absolutely can reach your college saving goals and give yourself the gift of a higher education without being burdened by student loan debt for decades to come. Every dollar you save today is one less dollar you’re going to have to borrow in the future. Start saving as much as possible, as early as possible.
Set Financial Goals for College Savings
Step 1 is figuring out how much you need to save for college and setting concrete goals. Estimate the total cost to attend college so you know what you’re working towards. Consider things like tuition, rooms, books, transportation, and other living expenses.
Once you have an estimate, determine how much you can contribute from sources like student jobs, gifts, investments, and federal student aid. Then set specific savings goals, like saving $X each month or $X each year to cover the difference. Write these down and post them somewhere visible as a reminder.
Some other tips to keep in mind:
- Open a dedicated college savings fund like a 529 plan. These tax-advantaged accounts make it easy to save and withdraw money for your qualified higher education expenses.
- Look for ways to reduce current expenses so you can put more towards your college fund each month. Things like eating out less frequently, using electricity more frugally, using coupons, or shopping your store’s sales.
- Ask family and friends to contribute to your college fund as birthday or holiday gifts. Every small amount helps.
- Once you start earning money from part-time work, aim to put at least 50-75% of each paycheck towards your college savings account. Develop this habit now and it will pay off down the road.
- Look for additional ways to earn or make money that you can put directly into your college fund. Things like tutoring, online surveys, market research studies, or participating in medical research studies.
With clear goals and a proper college savings plan to systematically save and earn money for college over time, you’ll build up a healthy college fund in no time and be well on your way to affording your dream school! Stay focused on the end goal – your college education is worth it.
Open a High-Yield Savings Account for College
Opening a high-yield savings account is one of the smartest things you can do to save for college. These accounts typically offer higher interest rates than regular savings accounts, allowing your money to start growing faster.
Look for the highest rates
Shop around at different banks and credit unions for the highest rates. Even small differences in percentage add up to hundreds of dollars over time. Look for rates at least 2-4 times higher than the national average. Here’re some good options:
- Ally Bank – They frequently offer rates over 2% APY and have no minimum balance or monthly fees.
- Synchrony Bank – Another online bank with high rates, currently over 2.2% APY and no fees.
Automate contributions
Start automatic transfers from your checking account to your high-yield savings account each month. Start with whatever amount available, like $10 or $50, and increase it over time as your income rises. Automating your contributions is the best method to save without even thinking about it.
Consider a CD ladder
If interest rates start rising again, consider a CD ladder. This means purchasing multiple certificates of deposit (CDs) with different maturity dates so you can take advantage of higher rates in the future. The money from each maturing CD can then be reinvested into a new higher-rate CD.
Following these steps and being diligent about contributing regularly to your high-yield account is essential when building up money for college faster than you ever thought possible. Saving for your education is absolutely possible if you make it a priority. You’ve got this!
Look for College Scholarships and Grants
Another great options is to apply for scholarships and grants. These are free money packages that you don’t have to pay back. Here are some tips to find college scholarships:
Search online for opportunities
There are many scholarship websites like FastWeb or Peterson’s that offer scholarships for all types of students. Create a profile and the sites will match you with scholarships you may be eligible for based on things like your GPA, test scores, interests, and your selected major.
Check locally
Check with your school guidance office, local organizations, employers, and places of worship. They often offer smaller scholarships for students in the community. Local scholarships may have less applicants so your chances of winning could be higher.
Think broadly about your interests and talents
There are scholarships for almost every skill or interest. If you’re good at drawing or music, play sports, are involved in community service, or have a unique hobby, find scholarships in those areas.
Apply to a bunch
Don’t limit yourself to just a couple scholarships. Apply to as many as you can that you are eligible for. While the likelihood of winning any single scholarship may be low, the more you apply for the higher your overall chances of success.
Submit a strong application
Follow the instructions carefully and submit all requested materials, which often include an essay, letters of recommendation, and transcripts. Write a compelling essay that helps you stand out from other applicants. Apply for scholarships with confidence and don’t get discouraged if it takes time to win an award. With hard work and persistence, you can earn money for college from scholarships and grants.
Saving Money For College? Receive a FREE Phone!!
If you’re saving up for college early, you could be eligible for some incredible government connectivity benefits! Here at EASY Wireless, we believe that everyone should have access to essential connectivity, even when on a budget.
That’s why, thanks to programs like Lifeline & ACP, we’re offering FREE phone plans with unlimited data. Here’s exactly what these plans include:
EASY Wireless Unlimited Plan
- FREE Unlimited Data
- FREE Unlimited Talk
- FREE Unlimited Text
- FREE SIM Card Kit and Activation
- Choose to Keep Your Number or Get a New One
To start with EASY Wireless, apply online by clicking the below:
Start Saving Today! Start Saving Today!
Or you can come to one of the EASY Wireless’s retail stores, where our customer service agent will help you apply for your benefits.
