In a global economic environment that we currently live in, it is very important to have up to date skills. College education is very important for an individual to acquire basic skills in a work area of choice. College education also brings in financial incentives too. In general a college educated person gets paid a higher starting salary and has a faster career growth than the one without a college degree. Additionally, college education is required for most of the advanced education programs. As a result, it is important to attend the college. According to College Board, college enrollment of high school graduates has also picked up from 49% to 66% during last few years. This is an indication that college education is a mainstream requirement for most employments.

There are mainly two types of colleges, private and state operated. State colleges get some funding from the state government and charge 30% - 40% lesser tuition fee than private colleges. According to College Board's last published figures, the average annual tuition and fees for state colleges for in-state students is $8,893 and average total annual expenses including room and board are $18391. Some state colleges charge a discounted tuition fee from in-state students. For out-of-state students, these charges are $22,203 and $31,701 respectively. Unlike state colleges, private colleges do not get any funding from the state and therefore, their tuition charges are higher. Typically private colleges don't distinguish between in-state and out-of-state students. For private colleges the average annual tuition and fees cost $30,094 and average annual total cost including room and board is $40,917. The cost of books and supplies is not included in these figures.

As you can see from these numbers, sending a child to college require a thoughtful planning. Whether it is planning for funding all college expenses, or partial, or planning for financial grant, or a student loan, it is very beneficial to understand and evaluate different aspects. This section provides you a basic understanding of college planning and some of the tools and tips that will help you better prepare for putting together a plan.

As stated above it is important to plan for college education early on. Here are some key actionable items on this aspect:

  • Discuss with your child the importance of a good college education.
  • Motivate him/her to do well in studies during elementary education.
  • Determine how much you intend to save by reviewing the steps of Savings Needed .
  • Select a savings plan that is appropriate for your needs. See Saving Plans .
  • Start saving early .
  • Review the growth of college savings account annually and perhaps adjust your contribution.
  • A few years before your child is ready to go to college, review the college Admission Process to be able to decide the right college, and go through the admission process in a timely manner.
  • Review Financial Aid process to plan for a mix of college savings, grants/scholarships, and student loans.