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How Much Should I Save For College?



Whether you’re a parent of a future grad or a prospective student, saving for college can seem like a daunting task.’s chairman and CPA Howard Dvorkin responded to three reader questions about when and how much to save for college.

Saving for a child

Question: My daughter turned 8 this week, and I realized she has only 10 years to go until college — and I haven’t even thought about saving. What can I do starting now? What can I teach her to do as she gets older? Or is it too late and I should just tell her to skip college, since it’s so expensive now?

— Pilar in Florida

Howard Dvorkin CPA answers…

Paying for college is still worth the investment, according to research compiled in 2019. Unfortunately, saving for college and securing loans has become as complicated as a doctoral thesis. That’s why I made you this video, Pilar, that explains your options in plain English…

Other college savings tips

As your daughter moves into high school, keep track of scholarship opportunities. Many are small, but there’s no limit on the number you can win. So three $500 scholarships can pay for a year’s worth of textbooks (which averages $1,146at public schools). Also check out’s extensive list of The 21 Weirdest College Scholarships Ever.

Some other ideas for saving on college include considering a less expensive two-year school before moving up to a pricier four-year institution and investing in 529 plans, which can really add up.

Finally, Pilar, remind your daughter as she grows up: Not every profession requires a college degree. While many do, if she wants certain jobs, she can get the necessary training outside of a pricy university.

Good luck, Pilar. You’re a good mother to not only raise your daughter in the moment, but also consider her future.

Saving for a teen

Question: My daughter just had her sweet 16, but it wasn’t sweet for me — she goes to college in two years, and I don’t know how my wife and I will pay for that. We’re also pregnant with a son, and I’m already worried about HIS college. While we both make good money — I’m a paramedic and she’s a lawyer — the sad fact is, we still have about $60,000 of student loans between us. How are we going to pay off our own loans while sending our kids to college? This wakes me up in the middle of the night.

— Mitch in Arizona

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Howard Dvorkin CPA answers…

Sadly, you’re not alone, Mitch. A new survey from the College Savings Foundation reports, “One-third of parents are still shouldering student debt but are determined to change that for their children.”

What are they doing? Quite a few things you and your wife can benefit from…

First of all, if you didn’t enroll in a 529 college savings plan for your daughter, do so for your son. While you could start one for your daughter even at 16 years old; the big savings come from starting young and contributing regularly. According to that College Savings Foundation report, a third of parents have 529 plans.

Second, your daughter can start now pursuing scholarships. Together, you can search for scholarships that fit her interests. Studying those requirements a year or two before she applies means she can tailor her activities and efforts to impress the judges. Don’t limit your search — as has reported, there are eccentric scholarships for pumpkin carvers, peanut-butter lovers, and redheads.’s scholarship is open to anyone who’s applied for lots of other scholarships!

Third, consider community college for the first two years. Not only will two-year schools save your daughter on tuition, but there are so many community colleges — more than 1,700— that one is likely to be within driving distance of your home. If your daughter lives with you those first two years, she can save thousands.

Fourth, take care of yourself so you’re better able to take care of your children. You and your wife can slash your monthly student loan payments by taking advantage of several federal programs. In fact, you might be eligible for loan forgiveness because of your job, Mitch. To find out is free: Call one of’s certified counselors at .

Bottom line, Mitch: There are many things you can do to help out your children — and let you get a good night’s sleep.

Saving as a future student

Question: I am a 28-year-old hairstylist who went to beauty school but never college. I have only a few hundred dollars on my credit cards, my old Subaru is paid off, and I have $11,500 saved for college. I plan to work weekends and go to school full time, but I don’t know when to pull the trigger.

I can add up estimates on tuition and books, but it all seems so mushy. When I search online, all the advice about saving for college is for parents of young children. What about adults like me? 

— Beth in Memphis

Howard Dvorkin CPA answers…

I understand your frustration, Beth. When you make other major purchases, you can easily anticipate the expenses.

A new house? The mortgage details your monthly payment for the next 15 or 30 years, as well as tell you how much is interest and how much is principal. Sure, home repairs are always unexpected, but except for some rare horror stories, you can easily handle most items that break.

College is perhaps the most unpredictable major expense you’ll experience. Prices vary wildly. The College Board says the average yearly cost of tuition and books ranges from $3,131 at a community college for in-state students to $21,706 at a public four-year school for out-of-state students. Private colleges? The average approaches $30,000 a year. That said, there are several rules for adults who either return to college or are heading there for the first time…

1. Cheapest is best for the first two years

As the numbers above prove, community colleges are much more affordable than four-year schools. That’s no big secret, and neither is this: Few employers care where you earn your associate’s degree as long as you earn a bachelor’s degree later.

Here’s what is lesser-known: Community colleges are popular with older students. “The average age of a community college student is 29,” says the American Association of Community Colleges. That will help you for a non-financial reason: You’ll feel more comfortable around those closer to your own age, instead of being surrounded by teenagers. Also, professors are much more attuned to instructing adults.

2. College savings plans aren’t just for parents

Perhaps you’ve heard of 529 plans, so called for their IRS designation. They’re popular among parents, who start contributing to these tax-advantaged funds when their children are very young. By the time they’re ready for college, that 529 plan has accrued a lot of tax-free dollars.

If you plan to go to school for four years, a 529 might make sense if you start right now. Perhaps the easiest explanation of that is from a U.S. News story called 4 Common Myths About Adults Saving for College. Check it out.

3. Don’t neglect your retirement

When you’re struggling to save for college, you’re not thinking much beyond that. Certainly, you’re worried about finding a job after graduating and launching into a new career. However, you’re 28 years old, Beth. While that’s still very young, you need to at least start saving a few dollars toward retirement — because those funds will grow just as quickly over time as a 529 plan for a newborn.

Even if you set aside as little as $5 a week, you can contribute to a retirement fund. I suggest you read our article about How to Get the Most Out of Your 401(k).

Bottom line, Beth: Whenever you start school, you’ve already made all the right moves. You have little debt holding you back, you’ve saved a significant sum, and you’re still working hard with an eye toward your future. My prediction: You’re going to achieve all the success you want.

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