College Savings for Late Starters

Don't worry that it's never too late to save: "Anytime you're ready to save for college is probably a good time to start,". "Obviously the earlier you can start, the better, but you shouldn't let being late to the game prevent you from getting started."

Look at your overall financial picture: If college is the immediate financial issue in your life, it may be tempting to devote all your financial resources toward it. But avoid doing unintended damage to your finances, specifically when it comes to retirement funds.

Don't get hung up on the savings vehicle: Start with 529 plans, which are state-sponsored college savings accounts, because of the tax advantages. Savings grow on a tax-deferred basis and can be taken out tax-free as long as they are used for qualified higher education expenses. But don't get mired in a hunt for the "perfect" savings vehicle. A 529, Roth IRA or even a traditional savings account works.

Be conservative: Because late college savers will need the money in the short term, they should consider more conservative investments, such as bonds – rather than stocks, where they could lose their money and not have time to gain it back.

Don't be afraid to start at a less expensive school: Families getting a late start saving could consider starting the student at a state college or a nearby low-cost private institution for the first year or two, then transferring to another school. That could buy more time to accrue savings, while still allowing the student to graduate from the school of his or her choice.

Do have tough conversations: Bring your children into the conversation about college costs and what you'll be able to contribute and what they'll be expected to pay.