Parents who stuff their children's college funds with more than they can afford each month are setting themselves up for failure.
"Parents start off saving $500 per month, but then the car breaks down or they need new tires," says Mackey McNeill, a certified public accountant and personal financial specialist. "But money is a habit."
Families can start by putting $25 to $100 consistently in a 529 plan, a tax-advantaged college savings account, and then add more when and if they can, she says.
But even if the monthly amount stays the same forever, parents can make a dent in the cost of college, especially if they start investing when their children are babies, says Lori Luck, a certified public accountant and personal financial specialist.
[Find out who can benefit from 529 plans.]
McNeill says with an investment of $25 per month, starting when a child is 5 would accumulate $6,300 over 13 years, if the account earns an average of 7 percent per year. She says this is equivalent to two years of community college tuition, based on data from the American Association of Community Colleges.
If parents of a 5-year-old saved $100 per month for 13 years with the same growth rate, they'd save $25,300 for their kid's education, McNeill says - nearly enough to pay for a year of private school tuition and fees. According to an annual study on trends in college pricing from the College Board, the net price of private college in the 2012-2013 school year was $23,840.
With $1,000 in scholarships or from a part-time job, that savings could pay for 25 percent of the four-year tuition and fees at a private college or university, McNeill says.
[Explore what to do before opening a 529 plan.]
McNeill personally started setting aside $25 per month for her niece and nephew, now 8 and 10, respectively, when they were 1 and 3 years old. By the time they go to college, she expects the investment will pay for a computer, living expenses or part of the first year of tuition for each of them.
If parents didn't get a chance to start investing consistently in their children's college educations while they were still in elementary school, investing monthly starting during their children's junior high or high school years can still significantly help pay for their education.
Saving $25 per month for six years with a 5 percent annual growth rate adds up to $2,100, says McNeill.
"This savings plan would cover one year of student fees, activity fees, parking passes and other expenses students have beyond tuition, room and board and books," she says. She bases her estimates on the "other expenses" category from the College Board's study.
If parents are able to save $100 per month for six years, they'll accumulate $8,300 if the account earns 5 percent annually. This is nearly the 2013 national average for four-year public college or university in-state tuition and fees, according figures from the College Board.
[Don't fall for these college savings myths.]
The extra bonus to saving an affordable amount is it inspires other family members to contribute. If you've been saving for six years and only have $38 saved in an account, aunts, uncles and grandparents won't be inspired to contribute, says Stephen Lovell, a certified financial planner and host of "The Good Life Made Better" radio show.
But if you're saving on a regular basis, family members see the money add up and want to chip in, he says. His wife contributes $25 per month for each of her stepgrandchildren.
Children themselves could also be inspired to contribute to their own education, says Luck. Knowing their parents are saving for their education gives children inspiration to do the same, she says.
Trying to fund your education? Get tips and more in the U.S. News Paying for College center.