College can be one of the most rewarding and beneficial experiences in a person’s life. But college education costs are high, and with no ceiling in sight, learning how to budget for a quality college education will be helpful. You cant put a price on education, but the price of college education leaves something to be desired.
Depending on what type of school a person is interested in attending is important. Community colleges offer many of the same courses major universities offer at a fraction of the cost and students of many community colleges can still get the college experience of living and studying on campus that those at universities or state colleges offer. College education cost associated with community college is a affordable to most people, making it a viable education option. Getting an education at a state college or private university also has perks. World class educational institutions often produce some of the most talented, productive members of society. So, no matter which route a person takes, learning how to afford the college education cost will be key to a successful college experience.
It can take years to save for college before school and still more to cover the cost of a college education once graduated. However, tax benefits help make saving specifically for college and other education expense possible. Specialized accounts and investment tools can help when figuring out the cost of college education.
While considering which savings tool is right for you, be sure to consider the fees, potential returns, investment options and risks.
One way to tackle the college education cost is through a 529 College Savings plan. This plan is provided in part, by the state in which you live, and offers tax free growth for investments. No federal taxes are withdrawn if funds are used specifically for room and board, tuition, books and other college expenses.
Setting up a bank account specifically for college education cost, is another way people manage college savings. Some families prefer traditional bank based savings accounts. And while you cannot lose money in these accounts, they provide no tax breaks. Interest will only increase based on what you put in.
Using other forms of accounts are another way people save for college education cost. These options include a custodial bank or brokerage account, which also offer no tax advantage. They can be opened on behalf of a child or as part of a Coverdell Education Savings Account, which has a contribution limit of $2,000 per child.