By Robert Chapski 

For those of you who don't have children and don't plan to have children, you can stop reading this post. For the rest of us, let's set aside legal-speak for a moment and think about something that will hit many young lawyers some day who decide to have children: college costs. (When many in the legal field are just looking for jobs and trying to pay off student loans, this might seem like piling on to have to think about college costs but, hey, just like retirement, we have to think about our kids' education too.) The cost of college expenses is increasing at a truly alarming rate.

A recent survey from Sallie Mae and Gallup shows that while many parents are saving money for their kids' college education, many parents may not be saving enough and most are missing tax advantages of saving through a 529 college savings plan.  This author is by no means a tax expert, but the article reminds us that it is worth learning about 529 plans and other college cost-saving measures that we can take now. There are even some plans such as the Independent 529 Plan that allow parents to pre-pay tuition now and lock-in costs to avoid "tuition inflation." (Check out Savingforcollege.com for some other helpful information.) 

Sallie Mae has a useful online calculator to estimate future college costs. Let's take an example. My wife and I just welcomed our new son, Sean, to the family on May 15. Sallie Mae estimates that it will cost us a ridiculous $342,027 to send Sean to college at a private 4-year institution. Sallie Mae also tells us that even if we set aside $400 a month and earn 5% interest, we're not even going to come up with half the money needed for his college education (we would only get to about $140,000). Turns out, we should be saving closer to $1000 a month if we assume a 5% annual rate of return. That's scary.  What's even scarier is that Sallie Mae notes the national average savings rate of return to be just 2.27% (i.e., putting the money under the mattress or the equivalent might not be such a good idea).