Learning, Your financial goals

Your financial goals: College education

This is the first course in a series of  7 called “Your financial goals

Saving for education

Are you planning to help your children or grandchildren with their education expenses? Or thinking of taking classes yourself? There are many options to help you achieve this goal.

Determine your education needs

You can begin to create a college savings plan by defining your education needs and preferences:

  • Would you prefer a private or a public school?
  • What will it cost? How much is too much? Make sure you take college inflation rates into account.
  • How long will it take, or how long do you have, to save?

The cost of college education

College costs increase at about twice the rate of inflation, from 5% to 8% per year. And these costs are already steep. According to google.com search over the India, the average tuition and fees for 2011 – 2012 for students are:

Type of college or university

Cost per year**

Two-year public college in stateRs. 1,50,000
Four-year public college/university in stateRs. 4,00,000
Four-year public college/university out of stateRs. 8,00,000 or more
Four-year private college/universityRs. 15,00,000

**In addition, you may have to pay for room and board. In 2011 – 2012, average room and board costs for a public four-year college or university full time is Rs. 4,44,350

Several other factors may also affect the cost of an education:

  • Student’s age
  • Academic record
  • Financial aid opportunities
  • Scholarships available
  • Degree goal
  • Housing costs (on- or off-campus)
  • Military service

Common college saving plan options

  • Accounts  allow you to make an irrevocable gift to a minor to an account that your child ultimately controls when he or she turns 18 or 21 (depending on state law). He or she will be able to use the funds for education and other expenses.
  • College savings plans are generally sponsored by states, state agencies or educational institutions for college tuition and expenses. These investment plans stay under your control and offer certain tax and contribution advantages.
  • Education Savings Account (ESA)  You can contribute to this investment account until children turn 18 unless the child is a special needs beneficiary. This type of account can be used for elementary, secondary and college expenses and tuition. It includes tax benefits but has a maximum contribution limit of (Find as per you state rules) per year.
  • Traditional/Roth IRAs. Penalty-free distributions are allowed from IRAs for eligible educational expenses for you, your children and your grandchildren. (Income taxes may apply to IRA and Roth IRA withdrawals). IRAs are not counted as assets for financial aid calculations, but withdrawals are considered financial aid income for parents.
  • Other options. In addition to savings, current income and borrowing, there are other ways to finance higher education:
    • Financial aid from federal and state governments
    • Work-study programs or a part-time job for the student
    • Loans from private, federal and college sources
    • Scholarships and grants from different sources
    • Family gifts

Borrowing from your retirement account to pay for education expenses

Borrowing from your home equity or retirement account — or reducing your retirement savings contributions to help pay for college — is an option. However, doing so could mean you’ll need to work longer than you planned before retiring. Encouraging your child to take out a loan for college, such as a Stafford loan, may mean that he or she will graduate with some debt. But remember that he or she will also have a much longer period of time to pay off the loan.


Other financial considerations for a college savings plan

As you explore college financing options and determine which program, or combination of programs, will best meet your needs, you may wish to talk to a financial advisor to guide you through the finer points such as:

  • How does saving for education fit into your financial life? How can you resolve competing needs to save for retirement and a child’s education?
  • What calculations are used by institutions in determining financial need?
  • How will a college savings plan affect your taxes, financial aid eligibility and tax credits?
  • What investment options do you have based on your risk tolerance and when the funds will be needed?
  • Which currently held funds are accessible and what are the penalties for early withdrawal?

(Note: As Per Indian, you search in google to get perfect plan while you are studying)

Message for you(Trader/Investor): Google has the answers to most all of your questions, after exploring Google if you still have thoughts or questions my Email is open 24/7. Each week you will receive your Course Materials. You can print it and highlight for your life Goal.

Your financial goals (7 Days – Comprehensive Course)

  1. College education
  2. Business ownership
  3. Investment planning
  4. Estate planning
  5. Insurance
  6. Long-term health care
  7. Charitable giving

This Completes the List of Courses.

Wishing you a wonderful learning experience and the continued desire to grow your knowledge. Education is an essential part of living wisely and the Experiences of life, I hope you make it fun.

Learning how to profit in the Stock Market requires time and unfortunately mistakes which are called losses. Why not be profitable while you are learning?

Get free important share market ideas on stocks & nifty tips chart setups, analysis for the upcoming session, and more by joining the below link: Stock Tips

Have you any questions/feedback about this article? Please leave your queries in the comment box for answers.

Disclaimer: The information provided on this website, including but not limited to stock, commodity, and forex trading tips, technical analysis, and research reports, is solely for educational and informational purposes. It should not be considered as financial advice or a recommendation to engage in any trading activity. Trading in stocks, commodities, and forex involves substantial risks, and you should carefully consider your financial situation and consult with a professional advisor before making any trading decisions. Moneymunch.com and its authors do not guarantee the accuracy, completeness, or reliability of the information provided, and shall not be held responsible for any losses or damages incurred as a result of using or relying on such information. Trading in the financial markets is subject to market risks, and past performance is not indicative of future results. By accessing and using this website, you acknowledge and agree to the terms of this disclaimer.

Previous ArticleNext Article
The Moneymunch editorial staff is a team of experienced financial writers and analysts with over a decade of experience in the financial markets. They have previously contributed to popular financial blogs and newspapers, and are passionate about providing accurate and up-to-date information to help both investors and traders make informed decisions. Trust the Moneymunch editorial staff to provide reliable and effective financial advice that can help you achieve your financial goals.

Write a Comment

Comment Policy: We love comments and appreciate the time that readers spend to share ideas and give feedback. However, all comments are manually moderated and those deemed to be spam or solely promotional will be deleted. Your email address will not be published. Required fields are marked *