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By FinanceBuddy Staff Writer
If you have young children, you probably have a lot of worries. They'll need food, health care, and school supplies for the next decade, and they'll also need a lot of your love and time. While you're thinking about all of these things, though, don't forget to start saving money for their college educations. Believe it or not, there are plenty of college savings programs that can help you to start saving right away, the minute that your child is born. If you invest in one of these programs, you'll have peace of mind, knowing that you're preparing responsibly for your child's future. Many of these college savings programs are run by state governments. For example, if you live in states like New York, Virginia, or Illinois, you can sign up for a 529 College Savings Program Direct Plan. These plans allow you to save money for education while receiving a nice tax break as an added bonus. (A married pair, for example, can deduct up to $10,000 per year by investing in one of these accounts.) Additional benefits include Upromise contributions, which are donated to your 529 account by certain companies when you patronize their products. Best of all, you don't have to be a parent to sign up for an account: you can save money for a grandchild, niece or nephew, or the child of a friend. If you'd like to explore a different option, consider opening a high-interest CD in your child's name. By investing a lump sum of $10,000 or $20,000 at once, and promising not to withdraw it for ten or fifteen years, you'll receive excellent interest rates from most banks. Then, interest payments will be added to the balance of the account, so that you'll end up earning interest on your interest. CDs don't offer tax breaks, like the 529 plans, but they do offer two distinct advantages: they aren't subject to the ups and downs of the stock market, and they can be used for any purpose, from education to a first mortgage to a down payment on a small business. If your child or teenager doesn't want to go to college, consider starting a CD, so that he or she will have funding for almost any career path imaginable.