According to the U.S. Census Bureau, people with a bachelor’s degree earn over 80% more on average than those with only a high school diploma. Over the course of a lifetime this can mean a gap of $1,000,000 in potential earning power. So when you start putting away money for your children’s college education, remember that you don't just save for college - you invest for the future.

Total annual costs (tuition, room and full-time board) at public and private universities are roughly $13,000 and $30,000, respectively. These costs will likely continue to rise between now and your child's first college semester. In fact, in the last decade, tuition costs have grown at nearly double the overall annual inflation rate. So even if you currently had enough money to meet today's tuition costs, in 18 years that amount will probably be insufficient - even if you invested your assets and beat overall inflation. If trends continue, tuition costs will more than double within 15 years. For a child born today, four years could realistically cost more than $160,000 at a public university and nearly $330,000 at a private institution.

These obstacles may not be quite as insurmountable as they sound. Portfolios of small- and large-capitalization stocks have not only historically outpaced inflation, they have substantially outperformed government bonds and money market equivalents, such as short-term Treasury bills. So although past performance does not guarantee future results, a significant portion of tuition costs may be met by simply including stocks in your long-term investment plan.

Source: Mutual Fund Education Alliance

There are specific Qualified Tuition Programs (529s), Coverdell Education Savings Accounts (ESAs), and Uniform Gifts to Minors Act (UGMA) Accounts & Uniform Transfers to Minors Act (UTMA) Accounts that offer some tax advantages. Many investors also use IRAs and regular savings accounts to save for education. A FAM Shareholder Services representative can help you decide what option is best for you.