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" Marianne Paramithiotti has two teenagers who will be starting college soon. &amp;quot;I&amp;#039;ve done the math,&amp;quot; says Paramithiotti, a district sales manager for a pharmaceutical company in New Hampshire, &amp;quot;and the numbers don&amp;#039;t add up.&amp;quot; Even if her kids go to a public school in their home state, it will cost more than $18,000 a year for each of them. &amp;quot;That&amp;#039;s about $150,000--and that&amp;#039;s impossible,&amp;quot; she says.  With tuition, fees, and room and board zooming up to $20,000 a year at public universities and averaging nearly $26,000 at private ones, many families are experiencing the same sense of disbelief. Middle-class households are especially hard-hit: &amp;quot;They&amp;#039;re too rich to qualify for federal grant programs and too poor to afford college,&amp;quot; says Kenneth E. Redd, director of research and policy analysis for the National Association of Student Financial Aid Administrators. So what are parents to do? If you&amp;#039;re feeling lucky, you might try the lottery. For the rest of us, getting children through four years of higher education calls for smart saving, smart borrowing, and careful school selection. Here&amp;#039;s what you need to know, whether your child is a toddler or a teenager. College? My kid&amp;#039;s still in elementary school. Now&amp;#039;s the time to... start a savings plan.  529s These state-sponsored investment programs are considered a better way to put aside money for college than ordinary savings accounts. The plans come in two types: prepaid tuition programs, in which you pay up front for a state university, securing the tuition at a locked-in rate; and savings plans that let you invest the money in stock-and-bond mutual funds. Both types grow free of federal income tax; most states also exempt the plans from state taxes. You may contribute up to $55,000 per child per year, but many plans allow you to contribute as little as $25 a month. The plans differ significantly from state to state; see www.savingforcollege.com. COVERDELL ESA Contributions to these college savings plans grow tax free, and you may invest in any fund or in individual stocks or bonds--the chief advantage over 529s. And a Coverdell is now considered an asset of the parent, not of the child. That&amp;#039;s important: When aid packages are computed, 5.64 percent of parental assets are considered to be available for tuition, compared with 35 percent of a child&amp;#039;s assets. There are limits on how much money you can put in a Coverdell. For most parents, the maximum is $2,000 per year per child under age 18. Even if you start saving right after your child is born, that may not cover four years of college.  TRADITIONAL SAVINGS ACCOUNT Eighty-one percent of us sock away college money in traditional savings accounts, despite their disadvantages. Experts tend to recommend a 529 or a Coverdell instead. But in 2003, Congress reduced the tax rate on dividends and long-term capital gains, so a brokerage account in your name or a Uniform Gifts to Minors account in your child&amp;#039;s name may give you higher yields. Check with a financial adviser. College? It&amp;#039;s around the corner--my high schooler has started looking.  Now&amp;#039;s the time to...consider the cost of each school. Be open with your teenager about your ability to pay and borrow for college--it will affect her decision. Choose at least one school you know you can afford, such as a community college. If she&amp;#039;s considering going somewhere out of state, stick to private colleges; they may have scholarship dollars. Public universities usually don&amp;#039;t offer much financial aid to out-of-state students, even if they demonstrate a high need. My high school senior just got into her dream school--her expensive dream school. Now&amp;#039;s the time to...negotiate tuition fees.  While discounts are more common at elite schools, some small colleges and public universities are also open to negotiation when wooing the best students. &amp;quot;We make no guarantees,&amp;quot; says William Elliott, vice president of enrollment at Carnegie Mellon University in Pittsburgh, &amp;quot;but, quite frankly, we don&amp;#039;t want to miss out on the top students. So if a parent asks, we&amp;#039;re more than willing to look at increasing the aid offer.&amp;quot;  Colleges generally won&amp;#039;t play &amp;quot;let&amp;#039;s make a deal&amp;quot; just because your child desperately wants to go there. &amp;quot;We take that as a given,&amp;quot; says Jim Belvin, director of financial aid at Duke University in Durham, North Carolina. But Duke, like many schools, will up the ante if a parent presents a compelling reason for them to do so. &amp;quot;Do you have unusual health-care expenses?&amp;quot; Belvin asks. &amp;quot;Are you supporting a parent in a nursing home, or are you responsible for an older child&amp;#039;s schooling?&amp;quot; Circumstances like these might help you get a better offer. My senior picked a school, and the bill is in the mail. Now&amp;#039;s the time to...get a loan. Students can borrow through the Stafford (available to all) and Perkins (targeted for the most needy) loan programs. Both offer low interest rates, and for the most part, interest does not accrue while the student is in school. Payments generally start six months after graduation. Parents can borrow through PLUS (Parent Loans for Undergraduate Students), a federal loan program with a cap on interest. There is no ceiling on family income, and you can borrow up to the full cost of attendance minus any financial aid received. Make sure you meet filing deadlines for financial aid; they may be earlier than you expect. &amp;quot;The costliest mistake parents make is to assume that you apply for financial aid only after your child&amp;#039;s been accepted,&amp;quot; says Kalman Chany, author of Paying for College Without Going Broke. &amp;quot;That&amp;#039;s not true. At most schools, financial aid deadlines closely mirror application deadlines.&amp;quot;  Spend a little, save a lot Every time I order a cheeseburger at McDonald&amp;#039;s, I&amp;#039;m saving for my 14-year-old daughter&amp;#039;s college education. In fact, if I can manage to eat about 500,000 McDonald&amp;#039;s meals over the next four years, I can sock away enough money to put Sam through four years at the University of New Hampshire. I&amp;#039;m saving through a program called Upromise--I like to think of it as Hamburger U. HOW IT WORKS: First, you open an account through Upromise, then you register your credit, debit, and loyalty cards online. You&amp;#039;ll begin saving when you shop at participating retailers. In addition to McDonald&amp;#039;s, companies such as Staples, Coca-Cola, ExxonMobil, and Century 21 Realtors will rebate up to five percent of your purchase. Better yet, when you use a Citi Upromise MasterCard, you&amp;#039;ll receive an additional one percent back on your purchases, up to $300 per year. You can even triple-dip: An AOL customer who uses her Citi Upromise MasterCard to purchase a package of Huggies diapers, for example, will receive a rebate from each of the three companies. Finally, if you link a 529 college savings plan from Vanguard or another qualified investment service to your Upromise account, the program will automatically transfer the rebates into your 529 account. UPROMISE ISN&amp;#039;T THE ONLY PROGRAM OF ITS KIND. A similar program called BabyMint works with MBNA America Bank and another group of retailers, including Coldwater Creek, Eddie Bauer, and Sam Goody. There&amp;#039;s no annual rebate limit, and the funds can be deposited into most 529 savings plans. Fidelity, which manages 529 plans for a number of states, offers a MasterCard that gives you a two percent rebate on all purchases, up to $1,500 per year. And Capital One offers the CollegeOne Visa Platinum Card, which rebates one percent on purchases. "^^<http://www.w3.org/2001/XMLSchema#string>
<http://www.goodhousekeeping.com/life/money/advice/a16902/college-cost-oct04/>