5 Common Mistakes Parents Make When Saving For Their Child’s College

 

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Learn what to avoid and how to build a smarter savings plan that sets your child up for success.

As parents, we want nothing more than to give our children every opportunity in life—especially when it comes to their future. Whether that means helping with college tuition, supporting their first big move, or simply giving them a financial cushion, saving for your child’s future is a major priority for many families. But even with the best intentions, it’s easy to make mistakes along the way. From starting too late to choosing the wrong type of account, some of these missteps can seriously impact your savings potential—and your child’s opportunities. The good news? With a little planning and a clearer understanding of what not to do, you can avoid these pitfalls and set your child up for long-term success.

Mistake #1: Waiting Too Long To Start Saving

One of the most common—and costly—mistakes parents make is delaying their savings journey. When your child is first born, it might feel like college is a lifetime away. Diapers, daycare, and doctor’s appointments take priority, and understandably so. But time is your most powerful asset when it comes to saving for your child’s future. 

The earlier you start, the more you can benefit from compound interest, which allows your money to grow not just on the original amount you’ve saved but also on the interest your money earns over time. Even modest, consistent contributions made early can grow into a much larger sum by the time your child is ready to head off for college, start a business, buy a home, or pursue whatever dreams they may have. 

Mistake #2: Prioritizing College Savings Over Retirement

It’s incredibly common for parents to put their kids first—especially when it comes to something as important as education. But when it comes to long-term financial planning, there’s a delicate balance to strike.

One of the biggest mistakes parents make is prioritizing college savings over their own retirement. It may feel like the right thing to do at the moment, but it can create major financial strain later on—for both you and your child. Here’s the thing: There are no loans for retirement. 

While your child can access a wide range of funding options to pay for college—scholarships, grants, work-study programs, and student loans—you won’t have those same resources available to you when it’s time to retire. If you drain your savings or stop contributing to your 401(k) or IRA to cover tuition, you may end up relying on your child for financial support in the future. That’s not the legacy most parents want to leave behind. 

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7 Ways to Help Your Children Learn About Good Money Management

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Teaching your kids about money is one of the most important jobs you’ll ever have to do as a parent and it is incredibly important to tackle this topic from an early age as they'll begin building attitudes and habits towards money from as early as five years old. I still smile when my kids talk about being a pre-schooler and not being allowed a specific item of food as it wasn't a good price! All those shopping trips with me where I'd only buy cheese strings or yoghurt pouches if they were on special price obviously had an impact.

Getting used to talking about money and personal finance early on can prevent your children from encountering financial issues in the future. Many people start seeking the benefits of Debt Arrangement Schemes because of debt issues that may have been avoided if they had learned valuable financial skills early on in their childhood.

Here are 10 tips to help your children learn about money -

1. Make Saving and Giving a Family Value

Saving and giving should be part of every conversation with your children, including how to save and where to give when appropriate. Too many families encourage their children to spend and not to save and give. A nice idea is to let them start to responsibly manage their pocket money from an early age. For example, if they are given £5 a month, you might encourage them to save half of it, give a small percentage to a cause they feel passionate about and then enjoy spending the rest if they'd like.

Our family have always sponsored a couple of children in developing countries via Compassion and this has worked so well to help our children see how important it is to give to those less fortunate. 

2. Help Kids Create a Budget

As your child gets a little older you can help them to create a weekly or monthly budget. It can include a contribution from their part-time job or allowance and then help your child to track their spending in a notebook or on an app. This visual reminder of what they are spending can help them to realise how quickly money can be wasted away or alternatively it can motivate them to save towards a larger purchase such as a phone or coveted trainers. 

3. Model Saving and Spending Appropriately

Don’t assume your children know the basics about how to manage money. They need guidance to delay gratification and understand the difference between wants and needs at every age. It is clear by the level of debt today that many adults still don't have a clue how to manage their money and a realisation that it is better to save up and buy an item outright instead of constantly taking credit that you may not be able to repay.  It's good to model this to your children and they can see the excitement of buying a large item once you have saved up and have the sense of achievement of being able to buy outright the new car, sofa or whatever it is you need. 

5 Top Tips for Securing Affordable Life Insurance for Mums in 2021

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It’s natural for us mums to worry about our family’s future and COVID-19 has not helped matters. The pandemic has highlighted the need to have the right financial protection in place to ensure your family are taken care of. As a mum, you’ll want to know that your children will be protected in the event of a worst-case scenario.

Life insurance is essential in securing the financial future of your family and ensuring they don’t struggle financially should you pass away. Life insurance works by providing a payout to your loved ones should you pass away during the term of your policy.

Your loved ones can then use this payout to help cover any financial commitments. These are often things such as:

• Mortgage payments
• Bills and utilities
• Outstanding debts
• Childcare costs
• Funeral costs
• Leaving an inheritance

There are a number of policy types available to suit every family’s need. From term based covered (cover for a specified period of time) to whole of life cover (cover for the rest of your life), to family income benefit (monthly income payments).

Whether you’re a young mum, single mum, stay at home mum or working mum, life insurance is essential for protecting your family should the worst happen.

Below are 5 top tips for securing affordable life insurance cover for mums from Hampshire-based award-winning life insurance broker, Reassured -

1. Lead a healthy lifestyle

It can be hard juggling motherhood while taking the time for yourself to lead a healthy and active lifestyle, but doing so could help you to secure a more affordable life insurance premium. 

The price you pay for your life insurance premium will be calculated according to the level of risk you pose to the insurer – the riskier they deem you to be, the more you’ll pay. 

At the point of application, you’ll need to provide information on your health and wellbeing, such as:

• Your lifestyle
• Your medical history
• Your weight
• Your BMI
• Your smoking status

This information will help to paint the picture of your current health (and, therefore, the risk you pose to the insurer). Ill health, being overweight, having a high BMI and being a smoker are all factors that can lead to premiums being inflated.

This doesn’t mean you’ll need to swap quality time with your children to hit up the gym every day but simple steps such as quitting smoking, eating a balanced diet and keeping active could all work in your favour to lead a healthier lifestyle and secure a more favourable premium. 

Pensions Advice to Help Tackle the Gender Pension Gap

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 {This post was commissioned by Profile Pensions and Mumsnet}

Did you know that the average person who takes pensions advice will increase their pension wealth by £31k? (1) That is a pretty massive amount, right? If you live frugally that is enough to keep you going at least another couple of years, or maybe you want to splash a good amount of it on a once-in-a-lifetime world cruise or the car of your dreams. Whatever it is that you choose to do with your money, there is no denying that £31K can make a big difference to the average person's life.

The Gender Pension Gap

I think pensions are a funny old thing and certainly not always top of your priorities. As a teenager, I didn't even think about them and then even in my early twenties when I got my first proper job I wasn't worried about paying into a pension. It was only when I started to earn a good amount of money in my mid to late twenties with a company that was going to pay a decent amount into my pension that I realised it was a really sensible idea to start saving for later in life. Before that point, I hadn't realised that the money I paid into my pension was taken before my tax and NI was applied to my wages and therefore it was really working well for me, saving me paying tax.

It's certainly now one of those times where you see the benefit of hindsight as I earned a lot of money in my late twenties and I now really wish I'd been paying in additional contributions to my pension, especially as the company I was working for even matched contributions and what I'd paid in would have been doubled. Never, in my twenties, did I guess that in my forties I'd be self-employed and not even have a current pension scheme!

It appears this is the story of many women; they don't see any urgency to pay into their pension as a younger woman and then have time off to look after their family and end up regretting their lack of financial planning later in life when their pension pot is considerably less than a man's. Research conducted by the Chartered Institute of Insurance (2) found that by the time a woman is 65 to 69 her pension pot will be only about a fifth of the pot of a man in the same age bracket, the woman's being roughly £35,700.

This gender pension gap is a reality and it appears that it not only comes about because of women perhaps working less due to family caring responsibilities but also as "the result of the unequal accrual of pension entitlements over decades. It is mainly the product of women’s lower state pension entitlement, the gender pay gap and lower historic access to workplace pensions" (3) 

Understanding the Reverse Mortgage Calculator

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The contrast between the busyness of your working life and the idyllic days of doing everything on your own terms in retirement can be massive. Once the phase of family responsibility, child-rearing, climbing the corporate ladder and seeking status passes, you should be left with a world in which you are free to relax and create a space in which you can peacefully exist without worry. 

I think most of us dream of our retirement days, where we have a chance to enjoy our passions, engage in hobbies and perhaps, even travel the world but of course, one cannot consider retirement without addressing the elephant in the room – financial stress. How are you expected to exist, never mind build a lifestyle of your choosing, without a regular salary? Sadly for some people, it is a step too far and they'll have to work long into their seventies and maybe even eighties if they want to live comfortably. 

However, if you are in the fortunate position of owning your home, the reverse mortgage (also known as equity release) might be a welcome ally in retirement. Let's investigate more about what it is -

Why would people do this to their bank cards?

A new web phenomenon is becoming more and more widespread throughout the UK. People are redecorating their bank cards and doing so for their friends and family. Here’s why:

1. It’s super fun 
Bank cards always look so plain and boring, so we were quite happy to see more and more people redefining what a bank card should look like. This is happening all across the web: on Facebook, Twitter and even on personal blogs.

Consolidating Your Debt is a Great Way to Kick Off 2018

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We'd all like to start the New Year with no debt, and no cash worries to speak of. Unfortunately, for most of us, that simply isn't a possibility. Though it would be nice to start the new year with no interest fees to worry about, if you can't pay off your debt just in time for Christmas, that doesn't mean that you can't start 2018 in a better financial situation than you were in the year before.

Debt consolidation could be the ultimate way to bring some structure into your payments, reducing the amount of interest you need to pay over time, and potentially keeping your stress levels to a minimum too.

Here, we're going to look at just some of the reasons why a debt consolidation loan could be a great way to start the New Year!

It Moves All your Loans into a Single Payment

Paying off debt can be a serious headache, particularly when you've got money owned to various lenders, in countless different places. A debt consolidation loan simply involves using a personal loan to pay off all the other accounts that you might have taken out with other providers. This means that you can instantly get rid of all the credit cards and overdrawn bank accounts that have been haunting you over the last few years. 

With a debt consolidation loan, instead of having to worry about multiple payment deadlines and other issues, you can simply make a single payment once a month towards your debt. This should allow you to focus entirely on that singular debt so that you can pay it off much faster. Instead of wondering which account you need to pay off first, you can also ensure that you're making a dent in all the money you owe each month too.

It Keeps Your Stress to a Minimum

Who doesn't want to live a happier, more stress-free life? Debt consolidation can help you to accomplish that goal because you no longer must worry about keeping track of multiple accounts at once. When you've got multiple debts in various places it can feel far more overwhelming than having a single owed balance - even when the amount you owe is the same either way.

Consolidating your debts can help you to feel as though you have more control over your finances, and it also cuts down on the number of frustrating letters you get through the door each month reminding you of how much you owe. 

You Could Benefit from a Lower Interest Rate
Perhaps the top benefit of debt consolidation is that it allows you to stop falling victim to the high-interest rates of credit cards and badly-chosen loans. Depending on your credit score, you might find that you can choose a personal loan with a much lower APR, bringing the amount you need to pay back to an absolute minimum. A lot of people don't realise that a maxed-out credit card can cost them a lot more in the long-run than a personal loan. You can use sites like Readies.co.uk to see specifically how different loan types compare with regards to annual interest rates.

At the same time, because personal loans can be quite flexible in the right circumstances, you might also be able to spread your payments out over a longer period too. This means that you don't have to spend as much of your monthly wages on paying off your debt. Although reducing the amount you pay each month will mean that you do stay in debt for longer, this can be an easier way for some people to manage their money, particularly when you're struggling with other expenses like rents, mortgages, or utility bills. 

You Might Improve Your Credit Score 
Finally, when you're constantly making late payments on your accounts because you can't keep track of all the money you owe, your credit score takes a serious beating. This means that even if you do end up paying back everything you owe, you might struggle to convince lenders that they should let you borrow from them in the future. A consolidated loan can make it easier for you to pay back the money you owe on time so that you can begin to build your credit.

Of course, the key to success with a consolidated loan in 2018 is making sure that you choose a structure that works for you. Ensure that you don't sign up for any loans that you can't afford to pay off on time, and make sure that you read all the fine print before you agree to any terms.

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Could They be the Coolest Grandparents Ever?

I often think about how lucky my kids are. They have wonderful Grandparents and enjoy spending time with them. On the one hand I wish I'd had my children when I was younger and then my parents would have been younger too and that would have given them a lot more time before health complications got in the way of some of the things they want to do.

However what will be, will be and here we are. Yes, both of my parents have health ailments that now limit some of the activities they can be involved in but does that stop them having fun? Not at all.

For the last four years the children and I have headed off to Poole in Dorset with them for a fun week away whilst my husband is busy at work and when I ask the kids what their favourite type of holiday is, so we know what to book next year, they always say the one with my parents. Why? Well lets look at some of the qualities of my parents and get an idea of why my kids love them so much -

Reasons to be Cheerful, Year 3 - week 3

Happy Thursday everyone. I hope your week has been a blessed one and if not then I pray it improves and you are able to find the joy in whatever your situation is.  There are always glimpses of what will be, even in our darkest days.  I personally know that things I have thought will be a tragedy have been an opportunity for change and a time for me to grow.

All is well here at the moment, I had a lovely weekend away with my JJ and since Sunday 10.30am I have not been on this computer at all. I have had a week away from blogging completely to just think and be. I really need to get on with sorting my weight and allowing myself some time to be able to exercise and get early nights. So anything appearing on the blog this week has been scheduled and written prior to Sunday morning. There is nothing like being organised, lol!

This week I am grateful for my growth in relation to money. When I first met dh I believed all money was meant for instant gratification and it never ever occurred to me to save and to spread out my spending. I have changed a lot in 20 years and now I am pleased to have a good balance - I spend and treat myself sometimes and at others I save and enjoy a larger, more fulfilling purchase like a holiday with my family. January/ February are expensive months for us with various insurances needing paying and the balance on our Easter holiday and I feel so blessed that we are able to meet these payments.

I am also smiling a lot about my recent purchases with the Christmas money I received.  I do love a bargain, especially a shiny one -

And now it is your turn, what is making you cheerful and grateful this week?

Why don't you join up with Reasons to be Cheerful this week? It is such a fabulous opportunity to stop and reflect on your life and to see the good in it. Have a read about what I believe and why #R2BC started, it has literally changed my life to have this weekly focus on what is god in life.  How easy is it to allow things to become doom and gloom?

There are an amazing group of people who join in with this linky, I call them my Cheerful gang and I am so grateful for each and every one of them. Some of them have been here since the very first post back in January 2011 and others just linked up for the first time last week but they all mean the world to me.

So if you want to join in, go for it.  We are a no rules kind of linky - you link up what you fancy (well as long as it is not just a blatant advert), a recipe, the simple things in life, photos, a story - whatever! Add in the blog hop code so people can travel around and then visit others and share the comment love.  I'll come and visit everyone at the weekend and do my bit....

Have a great week, Mich x

What does your bank statement say about you?

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On the drive to work this morning I was listening to Premier Christian Radio and there was an interesting feature about the march which happened in London on Saturday and also about the strength of feeling in the UK that the average person is being treated unfairly with all the new funding and benefit cuts that are happening.

I am proud to know a friend who got off her bum and went to the march this weekend and stood up for what she felt is right. I am embarrassed to admit that I do not really have a full clear picture of what is going on in our economy.  I rely on my husband to keep me up to date with what I need to know and I also allow his opinions to help form my own.  This is not because he is controlling or this is his wish, I am just a bit out of the loop.  I rarely listen to the radio, read a paper or watch the news on the TV, I am normally busy doing something else. 

Anyway, this radio feature then went on to discuss that there has been a public outcry for new taxes, which some are naming the Robin Hood taxes, ie that the rich give to help the poor.  This of course led to discussion about the banks and how much some people are earning and how little the banks can be paying in corporation tax.  It was stated that Barclays made £60 million profit in 2006 but paid just 2.4% in corporation tax, due to all the loop holes that they can make use of.  How can that possibly be right when someone who earns £20,000 gives back approximately 22-25% of their earnings? 

What is it they say? The rich get richer and the poor get poorer but this is abysmal and actually just makes me want to sit down and cry  but I know that would not help anyone.  So what can I do?  an average mum of 3 who works part-time and does various other activities including charitable ones. A cash poor, tie poor Mum. What can I do to make a difference?  If you have an idea please do leave me a comment, I would appreciate it.

Surely this inequality is where the focus needs to be, lets start with the concept of fairness. It is not right that some people in the UK do not have a bed to sleep in or that they cannot remember their last hot meal yet others may have just earned £7million for a years work. I am not saying it is wrong to earn good money, if you do well, work hard, are talented, have been given a good break or similar then you will earn more than the average and well done to you but you have to apply the biblical concept of 'enough' surely? Once you have enough money to live comfortably then how can you justify stock piling more and more money?

I know that often I am dreaming of more: staying at home and not having to do paid work, just being able to volunteer; that kitchen re-fit; a second car; an abroad holiday.  All things that may come one day and things that I know are not essential but what about those people who are dreaming of the next car when the last one is only a couple of months old or having the bathroom refurbished when it was only done a year ago or having their 40th party on an exclusive Caribbean island for the cost of £400,000.  These things I just cannot see are right or OK.  The concept of enough has been well and truly forgotten there.

So today, why don't you take a look at your bank statement (and credit card statement or is that statements?) and see what it is telling you.  Where you actually spend your money is where your real priorities lie.  Looking at mine I can see most of our money goes on buying and running our house, feeding and clothing us all, giving to charities, having meals out or take aways, buying and running our car and saving for our children's future. If I wanted to cut down I could spend less on our food bill, clothing and meals out but actually none of them are done to excess so I feel quite happy we are spending wisely and being good stewards of what the Lord has provided us with.

I would have hated to look at that statement and know that money was being wasted on alcohol, gambling, cigarettes, excessive gadgets, crazy mobile phone bills, gaming systems and games, beauty products, glossy magazines or anything else in the same vein. Go back a few years though and you certainly would have found that many of those things featured on my statement in a disproportionate manner to the amount I earned.  I regularly over spent and bought unnecessary items.  It is great to realise how much things have changed for me in the last 10 years or so.

Don't get me wrong I am not telling you to stop spending on the things you enjoy, I am just saying take a look at your own spending habits and analyse where the money is going and you might just be surprised. 

Are you looking after the money you have or is it being frittered away?


Whether you decide to make any changes if entirely up to you.  In fact having sat and read this post a few times I might just have to make some changes to the amount I spend on clothes for the kids and myself.  A fabulous blog post I read a little while back has sat at the back of my mind niggling away at me and really I know I should be more cautious in this area.

Update from yesterday & shopping addiction!

In 100% better mood today. I did not enjoy yesterday at all, I tried not to allow myself to get too low and to wallow in things but I did end up eating a bar of chocolate that was not planned for. Did I feel better for eating it? not really. Did I really enjoy it? not really - must remember that for next time.

Dh and I had a good old chat last night and got some stuff in the open and I feel better for knowing his views but am so sorry I have inadvertently hurt him. He has enough issues without me adding more, so I will try and actively remember to curb my spending and to be good. What is it they say - look after the pennies and the pounds will take care of themselves.

I think I am starting to identify that spending/ shopping is my other addiction. I like the thrill of having something new. Where I have lost weight recently I have got all excited and bought a few new things and because they have individually been cheap £3 or £5, then I have told myself it is OK, but I forget it all adds up. So I have some bits to take back and put the money back in our bank account.

It is really crazy as I get seduced by the fact that something is reduced and therefore a good deal but I must stop. I think I will just have to stay away from the shops for now and keep temptation out of my way until I have done some more reading and worked the steps more to learn to see the difference between want and need.

I did not realise but it appears that I am even being compulsive with the food shopping and overspending there. I really do not mean to do that. I said to A last night that maybe I will have a food list which I agree with him and then I can not deviate off it or he can go shopping.

So for now I am on a spending ban. Luckily my gym membership is taken care of out of my salary so I can continue to enjoy that and things like toddlers cost just £1.50 so I will keep going there, but meals out need to be minimal and nights out with the girls stopped etc etc. We are on holiday next week and there will be a cost there and then it is time for the car service and car tax very soon - £400 out the window. I must keep this bigger picture in focus.

I have decided I will look at our spending and the bank account more often, so that A does not have to feel the responsibility is all on him. We are a partnership and we need to strive to do things together.