Never mind saving for the children's college education. If you have children, or expect to have them, you've got a few other expenses to think about first, like a hospital birth, diapers, child care, braces and Air Jordans.
Then the the college education itself will come with a tab of $10,000 to $20,000 a year in today's dollars.
But you don't have to be intimidated by the cost of rearing and educating children, says Paul Nastasi, a principal with A. J. Perry Co., a financial consulting firm in Baltimore. You just have to think realistically about your children's future -- and save as much as possible.
"Tuition is really the big expense," says Mr. Nastasi. "But when they're 2, you don't know if, or when, they're going to college. Just start saving whatever you can. It's easier to save money over a long period of time than to try to do it in a year or two."
Fran Smith of the American Financial Services Association in Washington says it is important to start saving when your children are very young. "Early on, if you start putting money away with interest compounding, it can be worth an incredible amount more than if you started 10 years later."
Mutual funds are an ideal way for young families to save money for children's emergencies and necessities, private schools and NTC
college tuition, says Malin Jennings, public information officer for the Investment Company Institute in Washington.
"If [parents] have money in a passbook savings account at 5 percent, it's every bit as liquid in a money-market mutual fund that brings in a higher rate of return," she says. "If it's put in a tax-exempt mutual fund, there are even more advantages.
Some mutual funds are good for parents who need access to their money not provided by more rigid investments, such as long-term certificates of deposit, Mr. Nastasi says.
Some people buy universal or whole life insurance policies to create another kind of savings fund for children's needs. Parents can borrow against the cash value of their policy and pay back the loan, usually at low interest, to keep the policy current. Or, if a parent dies, part of the policy proceeds can be used to pay children's expenses.
"For a 1-year-old child, $520 saved per year in a 6 percent money-market account at a bank for 18 years is almost $17,000," Mr. Nastasi says.
"That's a year and a half's worth of tuition. And when you add in things like financial aid, loans or having the student work, [college] begins to look more realistic."
Think positive -- you're never too poor to have children.
Adriane Miller is a free-lance writer who often covers business issues for The Sun.