Having children in n expensive proposition. Depending upon whom you speak with, the average family will spend between $252,000 – $412,000 caring for their child over the 21-22 years of their life. This of course includes everything from diapers to a diploma. With all these expenses, it’s no wonder why so few people have plans when it comes to paying for college. We need a plan for turning Diapers into a Diploma.
The Cost of Living is on the Rise
Where you live is a huge factor in determining the costs associated with raising a child. Where we live, the cost is around $18,700 per year. (We live in CT) This includes costs associated with housing, transportation, education, food, health and the all important miscellaneous category. Check out this calculator to see what your estimated costs will be. And these are just the costs of living today. These costs are not going to stay the same, and we are fooling ourselves if we think these costs are going to get less.
Student Debt is Out of Control
This is not a new topic. We speak often about the rising debt load being placed upon the future of students. In 2009, a concerning change in the national debt picture happened. In that year student loan debt surpassed both credit card debt and auto loan debt. Student loan debt has risen between 400-700% in the last 10 years. This means that with each passing year, students will graduate with a greater and greater debt load. We can not say this often enough, financial planning for the college years is essential.
Turning Diapers into a Diploma
So when should a parent start financial planning for their children? Parents need to think diapers, not high school. If you start planning for the college years when your child is in diapers, then you will be well prepared for the college years. In fact, there are many opportunities where parents can set money aside through the years if they are willing to capture those finances before they are reallocated back into the budget. One such expense is the diaper find. Diapers cost the average family $1,000.00 per year. If a family was to capture that $1,000.00 per year for 14 years at 1 % interest, they would have around $17,000 dollars saved by the time the student was ready for college. And that is just one expense that could be captured.
By making some simple adjustments, parents can turn those diapers into a diploma. It is not too early to start preparing for the college years. Do you have a plan? If not, start today! We can help in your planning process, give us a call.