Financial Expert Shares Tips on How to Save Money For College

— -- The Kerr family of Denver is excited about the future but daunted by the prospect of sending three kids to college.

“I think it’s absolutely overwhelming,” Lauren Kerr, whose three kids range in age from 2-years-old to 11-years-old, told ABC News.

The average cost of attending an out-of-state, four-year public college today is nearly $33,000 per year, according to The College Board. That comes out to more than $130,000 per child for a four-year degree.

To help the Kerrs navigate the college financial process, ABC News brought in Lynette Khalfani-Cox, a financial expert and the author of “College Secrets: How to Save Money, Cut College Costs and Graduate Debt Free.”

The first step, according to Khalfani-Cox, is to start saving.

“People often say they can’t afford to save, and I say you can’t afford not to save,” she said.

Khalfani-Cox recommends setting aside just $20 per month from the time a child is born, which adds up to more than $4,300 by the time he or she is ready for college.

If you put that $20 in a 529 savings plan, you will have saved double that amount, for a total of $8,730, according to Khalfani-Cox.

“The great thing about 529s is that they’re transferable, they’re portable and there are great tax incentives,” Khalfani-Cox said. “By transferable, I mean that a family can transfer the funds from one student to another.”

Khalfani-Cox also recommends exploring Individual Development Accounts, or IDAs, which she says are perfect for families with low-to-middle incomes.

“They are the best kept secret,” Khalfani-Cox said of IDAs. “They’re the fastest way to give a turbo boost to your college savings account.”

With an IDA, in exchange for agreeing to set aside money for one year or more, government agencies, non-profits and corporations agree to match funds at a two-to-one, or sometimes three or more-to-one, rate.

“I tell families all the time, you either save now, or pay more later,” Khalfani-Cox said.