Starting early is one of the first and most
important steps you can take in accumulating the money you need
to pay for college. Because of the power of
compounding,
the sooner you start investing, the more opportunity your contributions
have to grow — provided of course that you reinvest any earnings
your investments produce.
Experts suggest that you open a special college
account when each child is born and add something every month.
You might encourage grandparents or other relatives and friends
to make gifts to the account as well. If you keep it separate
from your household account or even a general investment account,
it’s easier to track its performance. And you may be less
likely to tap it for everyday expenses.
The earlier you start, the less you’ll
have to contribute each month to reach the goal you’ve set.
For example, if you added $50 a week to an account providing an
8% return, you’d have just over $100,000 in 18 years on an
investment of just $46,800.
