Saving for college is a huge undertaking for parents, and with the continued increase in cost saving can become a major source of stress for parents. On this episode of the podcast, lawyer Shannon McNulty is joined by financial planner Nannette Kamian of Cultivating Wealth, who shares her unique and refreshing perspective on saving for college. First off, she doesn’t want you to use an online calculator to try to determine how much you’ll need to save- you will panic!
Determine your philosophy
Nannette acknowledges the rising cost of college, and believes that in time, there will be more options for education and payment, and that the hysteria surrounding college and which one you go to will die down. Instead of trying to save some large sum of money when you don’t know what your kids plans will be (or what the costs will be), Nannette encourages parents to start by determining their College Funding Philosophy and goals, writing that down, and communicating it with your children (when they’re old enough).
How Much Money and Where Should it Go?
While everyone’s situation is unique, Nannette reminds us not to aim for saving some unknown amount of money that feels unobtainable. Instead, she encourages parents to determine an amount they’d like to contribute each year of school per child, and to be thoughtful about where that’s saved; 529 accounts are usually a good option (with good tax benefits in states like NY), but make sure to avoid UTMA or UGMA accounts.
Though we don’t know what will happen to the cost of education, Nannette gives very actionable ideas and tips to help you save for college while maintaining your sanity.
Resources mentioned
Read more in Crazy College Money
Check out Cultivating Wealth
Learn more at Saving for College
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Learn more about McNulty Law
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