While many thoughts can consume parents' minds when they bring their child home from the hospital for the first time — Ashley Kinder remembers having one in particular.
"Saving for college was one of the first things on our to-do list when we brought our daughter home from the hospital," said the 30-year-old Philadelphia-area marketing communications manager. "That in itself is telling, that college tuition is so expensive — and rising each year — that my husband and I need 18 years to save."
Many parents apparently are having similar thoughts, as 57% of parents are saving for their children's college — up from 48% last year, according to Sallie Mae's "How America Saves for College 2016." The average amount saved also has jumped, going from $10,040 last year to $16,380.
And while 55% of parents feel confident they will meet the cost of college, experts stress it's still important to research how you save and what types of plans you use.
"When it comes to saving for a child's college, you need to choose the right vehicle," said Chris Miller from OneAtlanta Wealth Group. "The majority of parents are using a general savings account, but interest rates are near 0%, so you may want to look at other options."
Miller said a 529 college savings plan is a great way to start saving and every state offers at least one plan and you can ask friends and family to donate to it.
"The great thing about a 529 plan is it allows your savings to grow tax-deferred and the money comes out tax-free on the federal level," Miller said. "However, if you use the money for anything besides college, you'll likely be penalized."
"Financial aid is extremely important when it comes to paying for college," Miller said. "Make sure your child applies for it and applies early. Many schools award money on a first-come, first-served basis."
Marcos Cordero, CEO and co-founder of college savings solution Gradvisor, said numbers showing more and more parents saving are not shocking. Parents of all ages have seen how student debt has negatively affected young adults and are now worried the same will happen to their children.
"This explains why Millennials, who have been hit hardest by the debt crisis, are the generation saving the most for their children's education," Cordero said. "They don't want their kids to go through what they're going through in regards to student debt."
Once you decide to save, the question then becomes what is the best and most effective way to save for college, Cordero said.
"For most parents, 529 plans are the best option," he said. "Given how many plans are available, you can choose a plan that matches your savings goals and your level of risk aversion when it comes to investments."
Cordero said many parents also get overwhelmed by the number of 529 plan options to choose from, but if one is looking for help understanding 529 plans, consider talking to your employer or human resource manager.
"Benefits that help employees save for their children's college tuition are becoming more popular, so employers and HR professionals are more knowledgeable about the plans," he adds. "They can answer your questions or help you enroll in a plan that's right for you. Even if your company doesn't currently offer such benefits, showing interest in them might lead to a change that makes it easier for parents to start 529 plans."
Kinder said her and her husband did a lot of research, and ultimately came to the conclusion of many experts — 529 college saving plans are the way to go.
"We were particularly surprised that you don't have to participate in your state's plan," she said. "As New Jersey residents, we did our research and found that New York has the best rates and enrolled in that plan."
Kinder said they also love the fact 529 plans make it easy for grandparents to contribute, so rather than receiving a check or cash for a birthday gift, they can contribute to their grandchild's education.
"They feel good about it, and so do our future-selves' checkbooks," Kinder said.