Hopefully, you’re keeping all of your New Year’s resolutions. If one of your goals happens to be saving for your kids’ college tuition, check out these tips for working it into your budget.
Let Grandparents Buy Toys for Holidays and Other Occasions
A lot of parents want their parents (the children’s grandparents) to contribute to the kids’ college savings accounts. While many grandparents can and will, it’s a hard thing to ask for, and your parents may want to buy the kids toys instead. Ask your parents what they’re getting your children for holidays and other occasions. If they happen to get your kids the toy they want, you can deposit the money you were going to spend on that toy into their college savings account instead. The bonus? If your state has an income tax deduction for college savings contributions, you’ll be able to claim it. After all, there isn’t an income tax benefit for giving your child a toy.
Get Your Kids to Pitch In
Even young children can pitch in for their own college savings by entering scholarship competitions such as essay contests and by contributing a portion of any money given to them by their grandparents and other relatives for holidays, birthdays and special occasions. The best part of doing this is that it can start a conversation about career goals and the importance of a college education. Children who understand why they want to go to college are likely to earn better grades, which can, in turn, result in scholarships. While you’re at it, you may be able to get your state’s 529 college savings plan to pitch in, too. Many states offer matching grant programs, where the program matches dollar for dollar what you’re contributing or a percentage of it, up to a certain dollar amount.
Piggy-Bank Your Change Electronically
Saving change with a physical piggy bank is fun, especially for your children. But some of us don’t use cash to pay for expenses. There’s a fix for this. Bank of America has a Keep the Change program where you have the change (rounded up to the nearest dollar) from your purchases deposited into a savings account. You can decide to transfer money from this account on a monthly or quarterly basis into your children’s college savings account. You’ll likely accrue $10 to $20 per month without the funds dinging your regular budget. If your bank doesn’t have a similar program, you can add up the difference between your purchases and the nearest dollar and transfer that amount on a monthly basis into a savings or college savings plan account.
Give Up Something You Don’t Really Want
Budgeting is a bit easier when you give up something you don’t want. For instance, why not give up some of the outings you really don’t want to attend? Saying no to a last-minute invite to a group dinner when you have a full workload helps you save time and your financial budget. This can save $20 to $60 and keep you from wasting time when you have other priorities that day.
Sign Up for Upromise
I can never overestimate the benefit of signing up for the free rewards program Upromise.com. After joining, you can earn cash-back rewards on online purchases, at grocery stores and at restaurants. The money can be used for college savings, but it’s never a good idea to spend more online than normal just to earn rewards. However, you can substitute some things you’d buy in person with cheaper online items. For instance, I buy the same brand of dog food online for less, and I don’t have to lug a 20-pound bag back from the store.
Spend Time Picking Out Cool Announcement Cards for Birthdays, Etc.
You can give an option at the bottom of a physical card or e-invites for birthdays, graduations, etc., to donate to a child’s 529 plan savings account in lieu of a traditional gift. In some cases, these announcements can help your children get as much as $250 just from one event. If sending the cards by mail to other parents, take the time to hand-write the cards or just pick ones that make the invites feel special. If sending e-invites, don’t pick the first one you see. Personalization can make a big difference. Pick one you really like, and write a warm, friendly message so everyone feels they are part of the event. Be sure not to specify an amount to give so no one feels pressured to spend more than they have.
Use Money from Federal Tax Deductions for Donating Your Kids’ Old Toys and Clothes
When your child outgrows an expense such as diapers or daycare, reallocate part of the savings to a college savings account. You can also use a part of what you get back on your taxes from donating your children’s old clothes and toys to charity. You may find you get back $100 per year. Just remember to save receipts when donating.
What are some creative ways you’ve helped save for your child’s tuition? Share with other Zing readers!
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