Steep price for higher education

You don't need a degree in applied mathematics to figure out that a college education is expensive and likely to get more so by the time your child sets up in the freshman dorm - even if that event occurs next fall.

The cost of college rises at a faster annual pace than almost everything in America. Parents who sent children to four-year public universities in 1997 paid an average of $7,472 for tuition, room, and board - about $30,000 for a bachelor's degree, not including books, travel, and pizzas.

At private universities - the four-year tally totals close to $77,000.

"College costs have far outstripped inflation," says Judy Heltzel, a certified financial planner in Salem, Ore.

If costs continue their pace - about 5 percent a year - expect to pay $72,200 for a public four-year education 18 years from now and $185,300 for a private one.

For parents doing a double take over their financial statements, the advice is clear and imperative:

Save and invest, sooner rather than later, says Ms. Heltzel, whose client-parents correctly view a college degree as a necessity in today's job market.

The average yearly earnings of a high-school graduate are $22,154; add a college or two-year degree and the number jumps: $25,181; with a bachelor's degree, $38,112; with an advanced degree, $61,317, according to a Census Bureau study.

In this respect, a college education is an investment.

"It's an important goal, just like retirement or buying a house," Heltzel says. "If it's important to you, you can get it done."

Some points to consider when saving:

How to save. From basic savings accounts to the stock market; consider a variety of savings vehicles (see story, right).

Whose name to save in. A child's income is usually taxed at a lower rate than a parent's income. But the amount a child has in savings may decrease the financial aid the student will receive down the road.

When colleges figure financial-aid packages, they assume children should contribute a bigger percentage of their savings than parents.

Also, if the money is in the child's name, it's legally that child's money after age 18 or 21- even if the child decides against college.

"You must make it clear to your child that this is education money, that this is serious money," Heltzel says.

Choosing a college. Junior or community colleges cost less. State universities are generally cheaper than private ones. Some colleges offer three-year programs. Vocational or trade schools offer specific training in a short time. "Commuter colleges" allow students to live at home and save on room and board.

Financial aid. Loans, scholarships, grants, and work-study programs can help defray costs - at least for a while.

Working through school. Many colleges offer on-campus jobs for students. "Some parents says they will help for a year or two, or that they always worked in college," Heltzel says.

Whatever financial path you choose, start while your child is still in high school. Getting good grades may be the best way to get a scholarship. But high school students can earn college credit, too.

Many junior and community colleges will let high-school students take classes - a cheap way to get lower-level credits out of the way. Or students can take advanced placement classes in high school. If they pass a test at the end of the year, they can get a head start with college credit for these classes.