Home >
Planning Services >
College Funding and Investments
College Funding Solutions
While there are numerous ways
to fund a college education, here are three of the most popular:
Mutual Funds
Mutual funds pool the funds of many investors to pursue
common investment goals like aggressive growth, conservative growth,
income, or combined growth and income. They allow you to invest
relatively small amounts (typically $1,000 for the first investment
and as little as $50 for subsequent investments). Mutual funds offer
the benefit of professional management and diversification among
a variety of stocks and/or bonds. Today there are more than 7,000
mutual funds to choose from.
If your child is young, aggressive growth funds might
be your best choice. Historically, the stocks of small companies
have outperformed all other asset classes. (Of course, past performance
doesn't guarantee future success.) The more time you have before
you need the money, the better aggressive growth is likely to work
for you.
Mutual funds are offered by prospectus only. The prospectus
provides complete information, including charges and expenses. Before
investing in any mutual fund, read its prospectus carefully.
top
Zero-Coupon Treasury Bonds
Zero-coupon bonds work like U.S. Savings Bonds: you
buy them at a deep discount and receive the face value at maturity.
Most zero-coupon Treasury bonds (often called "zeros")
are available with a minimum $1,000 face value. They are backed
by the full faith and credit of the United States and are exempt
from state and local income tax. At current rates, a $10,000 investment
can grow to approximately $20,000 in twelve years.*
* Based on yield to maturity at current rates as of
11/14/96. Prices and yields are subject to availability. Zero-coupon
Treasury bonds sold prior to maturity may be worth more or less
than their original cost, and their prices vary more with interest-rate
movements than with other bonds of similar maturity. Interest income
is subject to Federal ordinary-income tax each year, although the
investor does not receive it until maturity.
top
FinAid, The
Financial Aid Information Page
FinAid offers a wide range of resources. It's well
worth a visit on the strength of one of these alone: FastWEB (Financial
Aid Search Through the WEB), a database that uses an online questionnaire
to match your needs to more than 180,000 private-sector sources
of aid. FinAid is maintained by Mark Kantrowitz, author of The Prentice-Hall
Guide to Scholarships and Fellowships for Math and Science Students,
and is sponsored by the National Association of Student Financial
Aid Administrators.
top
CollegeNet
CollegeNet is designed mainly to help users search
databases for appropriate colleges, but it also offers a financial-aid
link to a variety of resources. Information sources found through
the links include the Department of Education, the Federal Trade
Commission (for avoiding financial-aid scams), and banks offering
student loans.
top |
