Et cetera : Regular, small savings deposits add up for college

For many families, the plan of how to pay for college is uncertain. And trying to figure out that plan can be intimidating.

But college is within reach, even for those with modest incomes, as long as saving begins early. Reasonable, small monthly savings, if started when kids are young, can benefit from compound interest and earnings. And those regular contributions add up over time.

Now is a good time to start saving for your kids or examine your savings to date.

By putting away as much as possible now, $25 or $50 a month if that's what you can afford, you can expand college options for kids and diminish their future debt burden, making it easier as they begin their careers and lives after graduation.

Savings can be put aside in any way you want, of course.

But finding a secure way that could earn you extra money is a good place to look. College savings 529 accounts are specifically designed for college and offer several benefits that a regular savings account does not.

Some benefits of 529 accounts include:

* You can choose, and change, your investment strategy, so you can be more or less aggressive over time.

* 529 accounts offer tax benefits.

* Anyone can start or contribute to a plan, so family members and friends who want to help your child can easily do so.

* Minimum investments are small so you can easily contribute over time, even when money is tight.

* Some employers may offer matching benefits for 529 accounts.

* Plans are transferable, so if a child doesn't head to college or doesn't use all the savings, you can transfer it to another child.

* You can always withdraw the money if needed before college, though there will be a tax penalty.

All states offer 529 plans and you can enroll in any you choose, but you should always check to see if there is a specific benefit to using your state's plan.

College Savings Iowa is the state-sponsored 529 plan that lets you save for education expenses and provides certain tax benefits. Iowa taxpayers who are participants can deduct a certain amount of their contributions per beneficiary, including rollovers, in determining their adjusted gross income for Iowa income tax purposes. Visit the College Savings Iowa website for more details and deduction amounts.