Saving for college during a recession

Mar 18, 2009 1:37 PM by Tracy B. McGinnis

Posted in Living / School & Education / College

College Savings Plan Options

How can you save money for your child's college education, especially during a recession? Chances are if you have a little one, you may not have given much thought as to how much college tuition costs just yet, but experts agree that getting started early with your savings goals is the key to being successful when it comes to savings. But how much do you need to save? When should you start? What are the best programs out there?

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Ask for help

"Financial aid is money distributed primarily by the federal government and colleges in the form of student loans, grants, scholarships, and work-study jobs," explains Womack. "Loans and work-study must be repaid (through monetary or work obligations), while grants and scholarships do not." Womack adds that students can receive both federal and college aid.

Asking grandparents to help contribute is another way to help raise money for high education. Ritter says 60% of grandparents say they would contribute to a 529 if they were asked.

Mike Kopko, created www.gradefund.com, a place where students can raise money for school by inviting friends, family, organizations, philanthropists, and corporations to reward students for doing well in school. Since it started in 2008, over 15,000 students have signed up for the service.

Families can also sign up for free with programs such as Upromise, where you can earn 1 to 25% when you shop online, dine out, or buy groceries or gas. A representative for the organization says Upromise currently has 10 million members and has contributed more than $500 million in member rewards.

Additional online resources

Financial aid director at Scripps College, David Levy, suggests having a frank discussion as a family about what you can afford before your kids start to search for colleges. He also suggests some additional sites for more information including: www.fafsa4caster.ed.gov (calculate what you can afford)

Search for scholarships, grants, and loans on sites like: www.fastweb.com, www.finaid.org, www.collegeboard.com.

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