Things You'll Need:
- Time
- Determination
- Internet Access
- FAFSA
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Step 1
Determine how many years are left between now and the beginning of college. The longer the time frame, the more opportunities to save. However, do not be discouraged if there are only a few years (or months) left. Saving any amount will be helpful. Of course, apply for Pell Grants by completing a FAFSA.
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Step 2
One option is the Traditional Savings account. This is an option that many people use and that most people are comfortable with because it is a low to no risk option. However, the interest rate on a traditional savings account is generally low, and the highest one can expect is 3%. This will not give your money the opportunity to grow as fast as needed to pay for college, even if you are saving for a newborn's education.
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Step 3
Another option is a Money Market account. MMAs usually have higher interest rates than traditional savings accounts, but normally there is a minimum amount to open this type of account. There are usually tiers and the more money you are able to invest in a MMA, the better the interest rate. However, this is not a fast growing option either.
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Step 4
529s are a faster growing option. These are mutual fund accounts that grow at higher interest rates, usually between 7 and 12%, depending on the stock market. If the money is used for education, there is no penalty for withdrawal. There is usually a certain amount that must be deposited each year in order to avoid any fees. This is a faster growing option.
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Step 5
UGMAs, Uniform Gifts to Minors Accounts, are also faster growing options. These have more flexibility than 529s, and have about the same interest rates.
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Step 6
Consider going to state schools, rather than private colleges. This has the potential to save a student a great deal of money, depending on the particular school. If a state school offers the degree that is needed and is in a convenient location, consider this as a good option and a smart way to save money on college education.
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Step 7
Give junior and community colleges consideration. Students can get at least two year's worth of college credits, including an associate's degree at a junior and community college. The price per credit is much more affordable than at a four year university, including state schools. Also, getting a two year Associate's Degree ensures that those credits will transfer with the student when they enter into a four year program. This really does give students the best opportunity at an affordable cost.
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Step 8
Research and apply for scholarships. Look everywhere. Start locally: garden clubs, literary clubs, lions clubs, and rotary clubs. Find scholarships at the colleges of interest. Research corporations: Kentucky Fried Chicken, Coca Cola, Johnson and Johnson. There are many corporations that offer scholarships, and with the internet as a tool, applications can usually be submitted online. Do searches on the internet for the area of study, the region, and specialties, such as sports, hobbies, and interests. Apply for everything possible.
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Step 9
Work study is also a viable option. Students can work at the college and earn money to help with expenses. These positions will work around the student's class schedule, which is a nice benefit. The money is not great, but it will help, and the student can usually study during down times at work.
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Step 10
Complete courses as the money becomes available. While it may take longer than the traditional four years to complete the degree by enrolling in courses as the funds become available, this does guarantee that the student completes her degree without incurring debt, and when she graduates, it is debt free.
