Great Ways To Save For College
How To Save - Then Grow - $30 A Week
7 Strategies To Save Money

Great Ways To Save For College
To offset rising tuition costs, you now have better savings options. Available are these tax-free savings:

Coverdell Education Savings Accounts — Called CESAs, they allow you to contribute up to $2,000 per child, per year. Withdrawals are free of federal taxes. You can't deduct contributions. CESAs are available at the credit union.

Anyone can contribute: parents, grandparents, other relatives and friends. Save the maximum $2,000 a year for 18 years — and you'll accumulate $58,200 in college funds (assuming 5 percent average annual interest). Or, use the money for elementary and high school expenses, including private-school tuition, books and supplies.

As the account owner, you control the money until used for qualified expenses. If your beneficiary doesn't go to college, you can transfer the money to another family member.

State-sponsored 529s — Another funding source is a tax-free Section 529 savings account. If used for qualified education expenses, they're entirely exempt from federal income taxes. In many states, you also can deduct contributions on your state return.

Contributions can be as small as $25 or $50. Money is held in the account owner's name. If your child shuns college, you can shift the funds to another family member — yourself included. Another advantage: With the account in your name, there are fewer financial aid restrictions. If in your child's name, you're more likely to jeopardize other funding.

Most 529s allow your student to attend any U.S. college, vocational or technical school. Except: You may get better investment returns if benefits are used exclusively at in-state schools.
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How To Save - Then Grow - $30 A Week
With systematic savings, even small sums get big. Suppose you save $30 a week for 35 years. To make it easy, use payroll deduction at the credit union. Assuming a 4 percent average annual return, you'll have $8,631 in five years. After 25 years, $66,972. Keep going - and by the end of 35 years, your nest egg will be $119,068. Of that amount, you'll have contributed $54,600. The remaining $64,468 will be interest earnings!

Don't think you can save $30 a week? You can if you want to. Just use the following suggestions to trim everyday expenses. Then total the amounts - you'll have saved more than $30 a week. You'll see how easily you can build your nest egg - one week at a time.

1. Compare prices. When your insurance premiums come up for renewal, make a few calls to find the lowest rate. Don't be surprised if you can save at least $300 a year. Save even more by comparison shopping for everything else you buy.
2. Cut your grocery bill. You can by buying in bulk through a warehouse club — or at the least expensive store in town. Stock up on great deals. Also skip convenience foods. They're four times as expensive as home-cooked meals. Trimming just $50 off monthly costs equals $600 a year.
3. Turn down the heat. For every degree, you save two percent. From 73 degrees to 68 degrees, 10 percent — or $110 off an $1,100 annual heating bill.
4. Eliminate one meal out. If you save $27.50 a month in restaurant meals, you'll have another $330 a year.
5. Transfer credit card debt. Yes, it really does pay off. Switching a $5,000 balance from a 15-percent bank or department store card to a 10-percent credit card saves you about $160 a year.
6. Sign up for low-cost checking. Compared to bank checking, credit union checking is easily $64 less a year.

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7 Strategies To Save Money
Here's how to really save:

1. Set goals. Misers can save without purpose. Most people can't. To get motivated, dream a little. Maybe you want a new car, house or carefree retirement. Once you identify your goals, ask us to help you calculate savings amounts. Or, use online calculators.
2. Start small. You're better off establishing a savings habit — and saving regularly — than saving a big sum just once. Put away something you can live with, say, $25 a week. Then gradually add to the amount.
3. Save automatically. What you don't see, you don't miss. So use credit union payroll deduction to have funds electronically deducted from your paycheck. Mutual funds also have automatic investment plans.
4. Maximize tax-deferred savings. You'll earn the most for each dollar saved with IRAs, 401(k)s and 403(b)s. Just don't put all your investments into employer plans. Diversify.
5. Take control of credit. How much do you owe? It's too much if you can't meet monthly obligations. Or, you charge more and more just to keep up. Talk to us about a consolidation loan. Also switch high-priced credit card debt to our low-cost credit card. By quickly paying down your debt, you can save more — faster.
6. Prepay your mortgage. Aside from adding equity to your home, you'll gain flexibility when you move or refinance. You'll gain even more when the debt is finally paid. Just round up your payment to the nearest hundred. Or, for more power, suppose you prepay $100 a month on a 30-year $75,000 loan at 6 percent. You'll save $35,500 in interest and cut about 11 years off the loan.
7. Track spending. By knowing where your money goes, you'll spend less — and save more. Carry a notebook to record small cash purchases. You'll quickly see how small sums add up to big ones.

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