eFinancial Portals

At some point in the future, your child is going to open up their letter of acceptance into the college of their dreams. The school is in perfect line with their career aspirations. The school happens to also be the alma mater of their greatest role model.

The only thing that will make you happier is being able to pay for your child's education. While there are student loans available, what a wonderful gift it would be for your child not to have to burden him or herself with paying off student loans once they finish college. There is a way to make this dream come true.

You have many options to help you save for your child's education. In fact, you have many more options today than ever before. In addition to your traditional investment vehicles (savings accounts, annuities, taxable investment accounts and others) you have access to 529 College Savings Plans and Coverdell Education Savings Accounts. With time and proper planning, your child's education with be paid for by the time they graduate from high school.

No matter which plan you select, you must select the best option to fund it. As a rule of thumb, there are several options to choose from, including:

Pay as You Go

You can wait until your child is accepted into a school and pay for expenses each semester out of your family budget. This option can be the most difficult to bear as you don't have the benefit of time and investment growth on your side.

Pay Later

You borrow the money once your child starts school and begin to pay off loans after your child graduates. In this case, your child can take on some of this debt load once they graduate. It all depends on whether or not you are okay with your child finishing school and then taking on this level of debt as a new graduate.

Seek Scholarships

It is always wise to seek college scholarships even if you have saved and are able to fully fund your child's education. Scholarships don't have to be paid back. According to the College Board, less than 44 percent of all financial aid comes from scholarships. This means that over 50 percent comes from loans. However, there is a fair chance that you will get some form of scholarship.

Save Now

You guessed it. Starting now is the best way to go in order to ensure that you are able to pay for your child's education in the future. This also gives you additional options in the future.

As you consider your savings options, you want to understand the following characteristics of any college investment vehicle you chose:

1. Growth Potential
2. Tax Implications
3. Risks
4. Control
5. Fees and Expenses

Cost of College

Each year, college costs will continue to rise. Therefore, it is highly important that you make smart decisions today in order adequately prepare yourself for later.

The cost of a college education will vary widely depending on which school you select. Most in-state schools will offer the best tuition rates to residents where the school is located. Private colleges are more expensive and Ivy League schools tend to be the most expensive schools of all.

(Source: The College Board®. Table above assumed to increase 6 percent annually.)

It's also important to note that the costs above do not include other costs such as room and board, books, supplies, equipment and transportation.