The day finally arrives when you get to bring your new baby home from the hospital. Most parents decide on the very day their baby is born that they will do whatever it takes to give that baby a happy life and a good education. So ask yourself how much you really should be putting away each month for your newborn's college fund.

Can you set aside $200 bucks per month for your newborn bundle of joy? $200 a month is a sensible savings target for many families serious about building up a college fund.

All it takes is $200?

Not for ALL the college costs in the future. Let's look at the economic situation for most students at four-year colleges and institutions.

• The published price for tuition, fees, room and board at the average 4-year private college for the 2008-09 school year is likely to be somewhere around $34,200.
• If costs continue to rise 6% annually, the four-year sticker price for today's newborn will be about $427,000.
• If your college saving plan gives you a 6% after-tax return, your $200 a month will eventually provide you with $94,000 in your college savings account, or 22% of the total price. The savings gap (more like a massive canyon!) is still large: $333,000. Don’t panic!

Consider the following reasons you should be feeling pretty good about the situation:

• A study by the College Board found that the "net price" at the average private college in 2006-07 was about $9,000 less than the published price. The difference comes from institutional grants and federal grants and tax benefits. Your $200 a month now covers 30% of the cost rather than 22%.
• If your child attends the public university in your state, the cost drops further. The projected growth of your $200 a month will be enough to cover 52% (sticker) or 66% (net price) for four years at your in-state school.
• The rate of inflation of college costs may be less than 6%, and/or your investment returns may be greater than 6%. If we increase the projected investment returns in your college savings account from 6% to 8% (but keep college costs rising at 6%), your $200 a month now covers 27% (sticker) at the private college (up from 22%), and 65% (sticker) at the in-state public university (up from 52%).

Your bundle of joy is no longer a newborn?

If your child is older, and you haven't any college fund, you will naturally have to save more each month if you want to be on the same track as the newborn in our example above. Instead of $200 per month, the parents of a 6-year-old are looking at about $250 per month, and the parents of a 12-year-old ought to be putting away at least $350 per month.( This is why it’s best to get a head start!)

DO WHAT WORKS FOR YOU

These words of wisdom can be applied to many different aspects of your life whether you are a successful physician, a software engineer at financial firm, a manager at a small motel in Midwest or a home maker. Everyone's financial circumstances are different and it is complicated to predict what the costs of your child's college education will turn out to be. You may be lucky and have the brainy child who will get a scholarship or maybe grandparents or relatives will provide gifts to help with college fund. In any set of circumstances you are better off saving something for your newborn than saving no college fund. “A baby will make love stronger, days shorter, nights longer, bankroll smaller, home happier, clothes shabbier, the past forgotten, and the future worth living for”. Start saving now and the future will definitely be worth living for! Request a personalized college savings proposal for your children/child now or call (866) 972-3262 to speak with one of our college savings specialists.

HUSH, LITTLE BABY, DON'T SAY A WORD, PAPA'S GONNA SAVE UP FOR YOUR EDUCATION!