Escalating tuition, room, board and text book costs combined with a challenging job market have led to a college funding conundrum for many middle class Americans.

How do parents who are still paying off their own student loans set aside enough money to pay for their children to attend college? Are we setting up an educational system that encourages infinite debt?

The exponential increase in costs associated with earning a higher degree certainly suggests that possibility. Consider recent Bureau of Labor statistics that say college textbook prices have risen over three times the rate of inflation from January 1977 to June 2015, a 1,041 percent increase. According to the National Center for Education Statistics, the average cost of tuition, room and board have risen from $3,877 in 1983 to $34,841 in 2014.

As colleges and universities across the country scramble to come up with scholarship money to cover tuition costs that have risen, presumably due to an increasing need to provide scholarships because education prices have grown out of control, middle class Americans are left swirling in that ironic vortex.

How, then, can parents today help students pay for a college education? With more than 30 years of experience in college funding, we offer these nine options:

• Invest in a college savings plan, but know that not all are created equally. It is possible, for instance, to max out your state 529 plan and still not have enough to cover the cost of in-state tuition. Talk to your financial advisor before you invest in any college savings plan to make sure it’s right for you.
• Set up a Roth IRA account for your student if he or she has wages or self-employment income reported to the IRS. Roths are not included as an asset when you fill out your FAFSA, so it won’t increase your expected family contribution.
• Apply for grants and scholarships. Take time to ferret out all of the options available to you. Not all scholarships are need based, of course, and many are tailored for unique situations that might suit your student perfectly. The time your student takes to research and apply for scholarships will be well worth it.
• Borrow the money, but look for the best loans possible and be careful about co-signing a student loan. You will be responsible for the loan repayment if your student defaults.
• Encourage your student to attend a two-year school, live at home, and transfer as a junior. You get the same degree for a fraction of the cost.
• Delay college until your student can afford to pay for it. He or she can live at home, save money on food and rent, and earn enough to cover tuition without any help from you.
• Use the equity in your home to cover the cost of college. If you have your heart set on helping your child with college costs and you don’t have available cash, this is a good option. Do not, however, withdraw from your own retirement accounts to pay for college.
• Look into an income share plan. This is a very new concept in which investors bank on a students’ success and students pay back loans based on their post-graduate income. Again, see an advisor before you invest in a plan like this.
• If you have the resources, set up an educational trust fund for your children and/or grandchildren. This is a great way to reduce your taxable estate, allow the funds to be professionally managed, and maintain some control over how the money is spent.

Other suggestions include canceling your cable service, a savings of $100 a month over 18 years will get you $21,600! Sell big ticket items you no longer use like boats and campers. Start saving the day your baby is born. Ask relatives to contribute to your student’s college fund rather than buying expensive presents for birthdays and Christmas.

If you have any questions about college funding, please contact us. We’d be happy to work with you to determine the best option for your family.