4. Save for College With a 529 Plan

Over the past five years, college tuition rates have jumped an average of 5.9 percent annually, according to the College Board. Should tuition continue to climb at that pace -- which some experts predict will happen -- in 18 years, four years of private college education will come with a stunning $350,000 price tag.

A 529 plan can be your saving grace. This tax-advantaged investment vehicle can help cover many college costs, including tuition and fees, book supplies and a limited amount for room and board. Most plans offer five to 15 investment options, including age-based portfolios that invest in stocks or bonds based on the child's investment horizon. Ideally, parents should begin investing from the moment their child is born, says Doug Chittenden, vice president of product management at TIAA-CREF.

Savings: If parents of a 1-year-old child contribute $200 per month, then -- assuming a 6 percent tuition inflation rate and a 6 percent rate of return -- the account will have $91,187 when the child turns 18. But if parents start contributing when the child is 11, the total balance shrinks to $24,766. Click here for tips on picking the right 529 plan. And crunch some numbers here to see how your college fund will grow. Or watch our video for more college savings tips.