Americans owe more than $1.7 trillion in student debt.
And if you’re like many current or prospective parents, you want your kids to go to college without taking on massive loans.
But knowing how much to save and the best way to save it can be a challenging task for new parents already running low on sleep.
If you start early and use the right tools, your small monthly savings can grow into a debt-free college experience for your child.
The first tool you’ll need is a 529 college savings plan. The plans vary but allow you to save money for a child’s future education costs and offer much more than a traditional savings account. The savings from your 529 plan are often tax deductible, can be invested while growing tax-free and have low minimums making it easy to start.
CNBC did the math, and we can tell you exactly how much you will need to save every month to send your child to college without saddling them with student loans. Check out this video for a full breakdown of your savings options and a case study on how much you’ll need to stash away to fully pay for your child’s college education.
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Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.