College Savings Plans : Securing education today

2007-03-08 10:33:40

( Financial )



Finding a job requires some form of education. Having none can be tougher.

As parents, you want to provide your children better opportunities in life more than you ever have. Sending them to good schools can jump-start their chances. But annual rise in education related expenses may put your plans on hold.

Fortunately, there are college savings plans you can start now.

College savings plans may come in different forms of investment packages. Choosing the right one is mostly dependent on your child’s age and your budget. A savings program for a toddler is entirely different from a kid who is just a few years away from college. There are available investment packages that are considered good college savings plans you can choose now.

Banks are dependable partners in creating college savings funds. They can offer you a number of safe investment programs to fit your budget. Traditional placements such as time deposit, passbook accounts, regular savings and interest bearing checking accounts are considered reliable forms of investment. One drawback though is the low interest they earn, which is usually associated with secure asset.

Another choice to consider is savings bonds. Bonds are fixed income securities that are issued by the government. They are usually bought at half the price and can be reclaimed upon maturity. However, maturity may take some time to earn adequate interest to meet its issue value.

Stock market and forex trading can also be good investment vehicles. You can profit from it if you have the expertise. However, volatility can wipe all your savings in a short time if you lack the experience.

Another option is the 529 college savings program. A 529 savings plan is a college savings funds that gives parents and other family members the initiative to deposit tax-deferred money to a particular savings account. Earnings from this account are non-taxable allowing your money to accumulate faster.

Nonetheless, take precautionary measures when adopting any of these investment opportunities. One mistake can easily take away your child's future.


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