Preparing to save for your kid’s school expenses can be stressful. If you took the first step of planning, then you’re already ahead of most people. Thanks to 529 accounts and other tax-free plans, a little planning today will mean a huge relief for your loved ones in the future when they won’t have to worry about student loans. Any type of loan can be a huge burden, affecting credit-worthiness and can stick with them for a long time.
You could always keep the money under your pillow, but doing so won’t earn you any interest (see – the power of compounding interest). But exactly how much will you need? This college savings calculator will tell you exactly what amount you need to put aside when you enter your kid’s age, for how long you want to make deposits, and anticipated interest rate into the corresponding fields on the Home page.
You can see the End of Year Balance for each year on the table by clicking the green plus (+) next to it. The two charts on the bottom of the page will help you see the growth of your savings at a glance.
The calculations will run automatically when you change any input fields, and tell you how much you need to deposit each year. The college savings calculator assumes that your expenditures will start off slowly before college, and then ramp up for the college years. If you’d like to add grad school, or change the assigned values for each school year, go to the Costs page and feel free to edit the table. Going back to the Home page, you’re going to see the updates results.