Worried about how you’ll pay for college for your children, when the time comes? You’re definitely not the only one. For most families in the US, university expenses are one of the biggest financial hurdles they’ll ever face. And if you’re an immigrant family, there’s an extra layer: figuring out a new education system, navigating financial aid, and still sending money to loved ones back home.
At Remitly, we get it. We know that many families are trying to do both, supporting relatives abroad while also building a future for their kids here. That’s why starting early with university financial planning can make a big difference. In this guide, we’ll break down the real costs of college, how to budget for those costs, look at some smart ways to save, and how to actually land scholarships and grants for college.
Why early financial planning matters
Think of planning ahead for college as giving your future self a huge gift. The earlier you start, the more choices you’ll have later, and the less likely you’ll be scrambling for last-minute solutions, or even loans.
Tuition fees are rising every year
We all know that college isn’t cheap, and unfortunately, it’s only getting pricier. Public university in-state students pay thousands of dollars per year just for tuition, and this rises to tens of thousands per year at private universities. That’s before adding in housing, food, books, and other living expenses.
The power of starting early
The good news is that starting with small steps now can turn into something huge later. For example, saving just $100 USD a month from birth could potentially grow into more than $30,000 USD by the time your child turns 18. Think of it like planting a seed; it takes time to grow, and needs to be planted in the right place.
Benefits for immigrant families
If you’ve moved to the US, chances are you’re already juggling a lot, like sending money home, covering living expenses here, and trying to build stability for your family’s future. So starting early with college planning can feel like lifting a weight off your shoulders—or more specifically, never putting that weight on in the first place, at least not in one go, anyway.
- Peace of mind: Knowing you’re setting aside even small amounts each month means your child’s education fund is growing in the background, while you focus on today’s responsibilities.
- Flexibility: The earlier you start, the more room you have to adjust if circumstances change.
- Shared responsibility: Grandparents, aunts, uncles, or godparents can contribute small amounts if they want to, which not only helps financially but also builds a sense of pride and support around your child’s future.
- Focus on opportunities: When you’ve already prepared, you can focus on choosing the right school, scholarships, or programs instead of stressing about last-minute loans.
- Living your “why:” For many families, moving to the US was motivated by opportunity. Saving early for your child’s education is a way to honor that decision, turning dreams into something tangible and achievable.
Understanding the true cost of university
When most people think about university expenses, they picture tuition. But the full price tag goes way beyond that.
Beyond tuition fees
College comes with a whole list of expenses:
- Housing (dorms, apartments, utilities),
- Meal plans or groceries,
- Books and supplies (sometimes $1,000+ USD a year),
- Technology (laptops, internet, software),
- Transportation (commuting, buses or gas, flights home),
- Everyday living (clothes, phone bills, health care, nights out).
Public vs. private universities
Public universities are usually cheaper, especially if you qualify for in-state tuition. Private universities cost more, but they often have bigger scholarships. A four-year degree at a public school might cost around $100,000 USD. At a private one, you’re looking at $200,000 USD or more.
Estimating costs accurately
Try to avoid guessing; it’s best to use tools like the College Board’s Net Price Calculator or the calculators on specific university websites. They’ll give you a real sense of how much to expect, factoring in any financial aid. Having an actual number makes saving a lot less abstract and easier to get your head around; you can start planning with a clear target in mind.
Building a realistic university budget
Now that you know what you’re up against, it’s time to map it out. A college budget makes everything feel more doable because you can see exactly where the money is going.
Why a budget matters
Think of a budget as your game plan and get your young ones involved when they’re ready. It takes out the element of surprise and helps budding students learn how to manage money—skills that will serve them well, long after graduation. In fact, the earlier you start introducing budgets to your children, the earlier they’ll learn to work around one.
Steps to create a college budget
Building a budget may sound intimidating, but it’s really about breaking things down into smaller, manageable parts.
- Estimate yearly costs: Add up tuition, housing, meals, books, transportation, and personal expenses. And like we said earlier, remember that many universities share a “cost of attendance” breakdown on their websites. That’s a good starting point if you know what the most likely options will be.
- Subtract scholarships and grants: These are forms of financial aid that don’t have to be repaid. Deducting them early gives you a clearer picture of what you actually owe, not just the sticker price. But there are no guarantees, of course, so the wisest course of action early on is to assume you’ll be paying full price.
- Add in family contributions and student income: Factor in savings, part-time jobs, or work-study programs. Even a few thousand dollars earned during the summer can make a big difference.
- Review and update every year: Tuition and living costs change, and so might your family’s financial situation. Revisiting the budget annually keeps it realistic, up-to-date, and accurate.
Example budget for one year of college:
- Total cost: $30,000 USD.
- Scholarships/grants: $10,000 USD (brings cost down to 20,000)
- Family contribution: $12,000 USD (from savings or monthly support).
- Student income: $3,000 USD (from part-time work during the school year).
- Remaining gap: $5,000 USD (can be covered with loans or extra aid).
Fixed vs. variable costs
Some things you can’t change, like tuition or housing. But variable costs like transportation and personal spending are flexible and, up to a point, within your own control. Teaching your child the difference between these types of costs will help them identify where they can save later on.
Savings strategies for families
With a budget in hand, families can turn to savings. Choosing the right tools and habits makes a big difference in building a strong financial foundation.
Exploring your options
- 529 savings plan: The most common way to save for college in the US, as it provides tax-free growth when it’s used for education. In fact, in some states you even get a tax deduction.
- High-yield savings accounts: Easy to open, safe, and flexible (but usually lower returns).
- Custodial accounts (UGMA/UTMA): The funds in this type of account belong to your child, though they’re managed by a custodian, usually a parent, until they turn 18 or 21, depending on their home state. That said, the money can be used before then providing it’s for your child’s specific benefit.
- Roth IRA for education: Though technically for retirement, some parents use Roth IRAs as a back-up college savings source because contributions can be withdrawn penalty-free for education.
Smart saving habits
When it comes to building a college fund, what really matters is consistency. Automating your savings so that a set amount moves into your education fund every month helps you stay on track without having to think about it.
You can also give your savings a boost by putting unexpected money like tax refunds, work bonuses, or even birthday gifts from relatives, straight into the fund. These little choices add up over time, and they feel much easier than trying to save in big chunks.
Another helpful approach is to set milestones. For example, you might aim to have $10,000 USD saved by the time your child reaches middle school and $25,000 USD by the start of high school. Don’t get too downhearted if you miss one, though—so long as the savings are growing, that’s the main thing.
Breaking long-term goals into smaller targets keeps motivation high and makes progress easier to track. To put it in perspective, saving $250 USD a month from birth would grow to $54,000 USD by the time your child turns 18, even if it earned no interest at all. That’s nearly half the cost of a four-year public university, and really shows what steady, long-term saving can achieve.
Tips for immigrant families
We know many immigrant families are trying to save for college but still send money to loved ones abroad when they can.
One tip is to create separate accounts, one for remittances, one for education. That way, your child’s fund grows steadily no matter what. Some families also ask extended relatives to chip in small contributions; even $20 USD a month from grandparents or aunts/uncles adds up over 18 years.
Scholarships and grants
Savings can only go so far. Scholarships and grants are powerful tools to reduce costs without adding debt, and they’re more accessible than many families realize.
Why scholarships and grants matter
They’re the single best way to reduce university expenses, since they don’t have to be paid back. Some students even piece together multiple small scholarships to cover nearly everything, proving that no award is “too small” to apply for.
Scholarships and grants can also open doors to opportunities; some come with mentoring programs, internships, or networking that go beyond just financial help.
For immigrant families, they can be especially meaningful, since many organizations specifically support first-generation students or those from diverse backgrounds. It’s worth the effort to search widely, apply often, and think of scholarships as part of your overall financial strategy for college. Remember what we said, though—there are no guarantees, so it’s always best to budget for the maximum you’d pay.
Where to find scholarship opportunities
We’ve suggested you search widely because scholarships aren’t just for straight-A students. They exist for athletes, artists, first-generation students, community service, and more. So there are plenty places you might find them:
- University financial aid offices.
- Nonprofits and local community groups.
- Databases like Fastweb or Scholarships.com
- Programs specifically for immigrant or minority students (like the Hispanic Scholarship Fund, APIA Scholarship, or TheDream.US).
Tips for stronger applications
When it comes to scholarships, timing and effort make all the difference. Encourage your child to start early, since some applications open well before high school ends. Staying organized with a calendar for deadlines helps prevent last-minute stress, and gives teachers or mentors plenty of notice to get those important recommendation letters sorted out.
Authenticity also goes a long way. Scholarship committees read countless essays, so personal stories and genuine reflections will help your child’s application stand out.
Remind your children that applying is a numbers game, winning even one out of five scholarships can still add up to thousands of dollars saved. Treating applications like a part-time job often pays off in a big way.
Exploring other financial aid options
If savings and scholarships don’t cover it all (and for most families, they don’t), there are still options.
Federal and state aid
The Free Application for Federal Student Aid (FAFSA) form is your best friend here. Fill it out every year because it unlocks grants, loans, and school-based aid. Some states even have their own additional programs tied to it.
Student loans
While many families prefer to cover costs through savings and aid, student loans can also be a helpful tool to make college possible. Federal loans are often the best place to start because they come with lower fixed interest rates, flexible repayment options, and even forgiveness programs for certain careers like teaching or public service.
Private loans are another option, though they usually have different terms and less flexibility, so it’s a good idea to explore federal programs first. With a clear plan, loans can bridge the gap between what you’ve saved and what’s still needed, helping keep the focus on your child’s education without worrying about short-term costs.
Work-study programs
Work-study lets students earn money while studying, usually on campus. The pay isn’t huge, but it helps with day-to-day costs and builds work experience. Plus, employers are often understanding about exam schedules.
Preparing for the unexpected
Even the most carefully planned budget can’t predict everything, so if you’re in a position to do so, you should certainly consider setting aside money for surprises. An emergency fund is like a financial cushion; it won’t cover every single cost, but it will soften the impact when life throws something unexpected your way.
Why an emergency fund is essential
An emergency fund gives students (and parents) peace of mind. Instead of scrambling for a loan or credit card when something breaks, the money is already there.
It’s not meant for everyday spending, but for those “just in case” possibilities like a sudden medical bill, a broken laptop right before finals, or last-minute travel to see family. Having this fund helps students stay focused on their studies instead of financial stress.
Common unexpected costs
- Technology breakdowns: replacing a laptop, phone, or printer at the worst possible time.
- Medical costs: co-pays, prescriptions, or out-of-pocket fees that add up quickly.
- Travel expenses: flights or long-distance bus or train rides to return home in an emergency.
- Course extras: lab fees, special equipment, or additional supplies that you didn’t know weren’t covered by the tuition fees.
Simple ways to build a cushion
Building an emergency fund doesn’t necessarily require huge contributions. Encourage your child to set aside part of their summer job income or a small percentage of any earnings during the year; if they can put just $25 USD a month into a separate account, over four years that’d be more than $1,000 USD saved.
Keeping the money in a separate, easy-to-access account ensures it’s available when needed but not too tempting to dip into.
If your children are still very young, or you’re not even a parent yet, this may feel like it’s all a very long way off. But time flies, and the sort of long-term planning we’ve talked about here can make a huge difference when the time comes.
FAQs
How early should families start saving for college?
As early as possible. Starting when your child is young makes saving much easier. But don’t worry if you’re starting late; every little bit helps.
What are the biggest university expenses to plan for?
Tuition is the largest, but housing, food, books, and personal spending can easily match or even exceed tuition.
Are scholarships and grants actually helpful?
Definitely. Many students cover thousands of dollars each year with scholarships and grants for college, sometimes even full tuition.
Is a 529 plan worth it for immigrant families?
If you plan to stay in the US, yes. 529s are one of the most tax-efficient ways to save for college.