Want to Make Saving For College a Piece of Cake?

The only thing harder than the college admissions process is the college tuition process. Parents with students just now entering higher education can expect to dish out an average of $25,911 for a public college or university or a hefty $98,646 for private institutions over four years just for tuition and tuition inflation. Those with younger children have it even worse with tuition at both public and private institutions expected to more than double in the next 10 years.

According to a survey by Alliance Bernstein Investments Inc., parents are not even close to being financially ready to foot those growing tuition bills. The study reports that the average amount families save for college will cover less than 25% of their child's undergraduate bills, leaving thousands to be covered by scholarships and grants that may or may not come through. The solution: to save smart, save soon and save often.

*PREPARE TO SAVE
Before starting a college savings plan, first pay off any lingering debt, such as car loans, old student loans and personal loans. When choosing which debt to eliminate first, credit cards are a great place to start.

*START EARLY
In today's world of tax-advantaged college savings plans, stock-piling your cash in a regular savings account is like using an abacus to do your taxes. With 529 prepaid and college savings plans, parents can save for school without paying any federal income tax on their savings and, if they select a state-sponsored plan, often without paying state income taxes on the funds either.

The secret to making these plans as lucrative as possible is to maximize your contributions early on, giving your money as much time as possible to grow before your child reaches the college years.

*SAVE STEADILY
Sacrificing a few little things can amount to large savings years in the future. Families who save $50 per week (the equivalent of one family meal out) will have more than $68,000 in the bank when tuition time rolls around.

A possible problem is that many families simply don't choose college savings over discretionary spending. Nearly 40% of all parents surveyed admitted that they had spent more on consumer electronics, such as MP3 players and computers, in the past year than they had saved for their child's education, and more than half invested more money in dining out.

*MAKE IT AUTOMATIC
To make saving easier, use direct deposit to have a portion of one or both parents' paychecks automatically invested in the savings plan of your choice. That way it's done, and you don't spend your whole check and think maybe I'll try to save something next month.

Breaking down monthly payments into weekly or even daily deposits can also help ease financial tension, turning a $200 monthly savings goal into a series of smaller, more manageable sacrifices.

*GET THE FAMILY INVOLVED
Encouraging students to become a part of the college savings process is not only financially beneficial in the short term, it also teaches students how to live on a budget, stay out of debt and be conscious of the funds flowing in and out of their bank accounts-- all life skills they'll need during and after college. With having the kids contribute to college, you're making them understand that they should also be responsible for their future. Forty percent of these kids return home after graduating because they are unable to live in the real world on a real salary.

Students can help pay for school with loans, scholarships, grants, AP courses that reduce the amount of courses they have to take. Encourage students to take on summer jobs, to invite children to strategize on how to reduce household bills and to offer paid chores they can complete in their leisure time.

The key to making this strategy work is to start early, letting students know what their financial obligation will be before they enter high school so they'll have adequate time to prepare.