In order to meet your emergencies you should set aside some
money, since, as your children get older and you set up your home, the sudden
expenses will come more regularly.
If
you don't set aside your emergency funds, those expenses can make happen major
stress in your marriage.
For the purpose of saving for college education, many ways
are there. Mutual funds offer investment programs depending on the fund, in
which your bank account can be drafted each month for a certain amount - as low
as $50.
If you start near the beginning and have an eighteen-year point
of view, you'll be able to weather the ups and downs of market cycles, and over
a long period many funds have go beyond 12 percent annual return.
These recommendations we're not saying that every child has
to go to college or that you should finance 100 percent of your children's
college education.
What we are saying is that if you want your children to go
to college and you want to pay for that, the easiest way to do it is by
starting earlier. It is extremely difficult to wait until kids are attained the
age of going to college.
Other good alternatives for college savings are the company
savings plans and whole life insurance policies bought for the child at birth.
The
real concern is not so much the investment vehicle as it is the self-control of
saving. For the sake of future benefits, you won't give up today's needs except
you have a long-standing perspective.
You also want to carry on funding retirement and savings
plans. This is the perfect time of life to begin setting aside money for your
children's college education.
For instance, if at a child's birth you started
depositing $100 per month in a savings account for his or her education, by the
time the child turns eighteen you would have deposited $21,600.
However, if that money had earned through the magic of
compounding, with an average of 12 percent per year (which is realistic) you
would have accumulated $75,786 toward that college education (before taxes).
Today in America,
that would pay for four years at almost any college. (It may not in eighteen
years, but it would today.) If you made a one-time deposit of $5,000 at birth
and it grew at 12% compounded yearly, at the end of eighteen years, the
fund would be worth $42,893 (before taxes).
To wait until your children are in college to begin saving
for that education might ease financial pressures in the short term, but it
will definitely compound the pressure in the long term.
By means of great experience of families all over the
country, the above advice steps. There are hundreds of thousands of couples who
have put four and even five or more of their children through college by
properly planning.
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