It’s the dream of every parent to see his/her children prospering in life. One of the best ways of ensuring that your children have a prosperous life is by saving for them. Here are some of the ways in which you can save for them.
This is a program that allows you to save for the education of your child without putting any money aside. Here you only need to register with the program and a custodial account for your child will be established.
After registering you need to purchase Upromise designated items through a credit card that you have liked to your child’s account. Once you make a purchase, a small amount of the money is deposited into your child’s account.
You can buy anything and the child’s account will be credited. For example, you can buy: electronics, computers, or grocery items and the account will be credited. The only thing you need to do is to ensure is that you buy from companies that are related to Upromise.
This is an excellent way of saving for college. The plan is of two types: prepaid tuition and college saving plans. The prepaid plan is aimed at covering tuition, boarding fees, and other mandatory fees.
In most cases the plan is sponsored by the state of residency. If you are unsure of the state where your child will be attending college, you should consider going for the college savings plan.
Here you need to make contributions into your child’s account. The good side with the plan is that the money invested grows without incurring any tax. In addition to this, if the money is spent on higher education, you won’t be required to pay tax when withdrawing it.
Dedicated Child’s Savings Account
While saving accounts attract low interest rates; they play a major role in helping your child save money. You should open a savings account under your name or your child’s name. For the account to remain active you should regularly deposit money into it. To instill the saving culture, it’s wise that you also ask your child to contribute to the account.
Employer’s College Savings Plan
There are some companies that offer direct deposit into college savings accounts. The plan works by making it possible to deposit money directly into the child’s account. If you are new in a company, you should ask your employer about the plan. If it’s available you should take advantage of it. In addition to the plan, some companies offer scholarships to employees’ children. To help you save more you should take advantage of these scholarships.
In addition to these ways, it’s recommended that you convert your children toys into savings. Here you need to see all the toys that your child is not using and sell them. To avoid spending any money, you should deposit the entire amount into a savings account.
If you decide open a savings account for your child, you should be disciplined and ensure that you make regular deposits.