Investing for a Child's or Grandchild's College

Radio Transcript, 60 seconds, for use during week of March 10.

This is an Invest Wisely minute brought to you by Iowa State University Extension.

Many parents and grandparents want to save for their children’s or grandchildren’s college education. As long as your own retirement funds are in good shape, this is truly a gift to the next generation.

Consider how long it is until you need the money. Parents and grandparents of newborns and toddlers can take more risk and might consider investing most of their money in stock mutual funds.

However, if college is less than five years away, you will want to move your money into less risky investments such as bonds, certificates of deposit, or money market accounts. 

And by freshman year it would be wise to have most, if not all, of your money in fixed income investments.

Invest Wisely comes from Iowa State University Extension through a grant from the Investor Protection Trust providing investor education on the web at investorprotection.org.