If you want to set up a college fund for your child but don’t know where to start, here are four tips to get your child’s college savings plan on track.
- Start as early as possible
College is expensive, so start saving for it as soon as you can. Use BALANCE’s simpleCollege Savings Calculatorto plug in your personal information and create a meaningful savings plan, no matter your child’s age.
- Choose a monthly contribution you can handle
Decide on a monthly amount that’s manageable and fits within your budget. When your child receives monetary gifts for birthday and other milestone celebrations, add a portion of the money for their college fund.
- Select the right savings option for you
Learn about these popular savings tools for college expenses and find out which route best suits your situation.• 529 Plans offer several investment options that will help your contributions grow over time, and your withdrawals are tax-free. Read 529 Plan FAQs here.
• Coverdell Education Savings Accounts (ESA) are similar to 529s with one key difference: they let you invest in any stock, bond, or mutual fund. However, they have an annual contribution limit that will cap your savings.
• Share Certificate Accounts offer flexible terms (3 months to 5 years) and a minimum opening balance of $500. The longer you keep your money in a share certificate, the more you earn. Plus, get a 0.25% APY* dividend bonus when you qualify for our Member Benefits program. Open a share certificate online or call LAPFCU at (877) 695-2732. You can also set up a virtual appointment or visit a branch.
Our in-house CFS* Financial Advisor, Chris Ellis can help answer your college savings questions and create a plan that works for you. Contact Chris at (818) 464-2070 or email@example.com.
- Explore free money options
Start looking into scholarship opportunities with your child when your child is a sophomore. Create a spreadsheet to keep the scholarship options organized by entry deadlines, essay topic, and other related items needed for submission. Your child should start applying to as many scholarships while he or she is in high school. Watch for LAPFCU’s scholarship program announcements at the beginning of each year.
Check out a related blog post on Paying for College.
*APY = Annual Percentage Yield. Minimum opening deposit for a regular share certificate is $500. Early withdrawal penalties may apply. Ask for complete details.
**Non-deposit investment products and services are offered through CUSO Financial Services, L.P. (“CFS”), a registered broker-dealer (Member FINRA/SIPC) and SEC Registered Investment Advisor. Products offered through CFS: are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the Credit Union, and may involve investment risk including possible loss of principal. Investment Representatives are registered through CFS. Los Angeles Police Federal Credit Union has contracted with CFS to make non-deposit investment products and services available to credit union members.