Do you plan on encouraging a private college? Ivy League even? Your savings plan should reflect that.

Before starting your college nest egg, find out now how much a college education will cost the year your child heads off to the dorms.

A college calculator on Savingforcollege.com (a Bankrate.com company) will project the likely total cost of an education in the year your little tyke heads off to college -- as well as how much you'll need to save every month to hit that goal.

You may be amazed at the monthly savings tab, even though your child may still be in the crib. True, the cost of higher education is spiraling out of control, but saving for your children's education isn't an all-or-nothing proposition.

According to Nicholas Yrizarry, founder and president of Nicholas Yrizarry & Associates, a wealth management firm in Reston, Va., it's not necessary to kill yourself trying to save the entire cost of college.

"The greatest thing that a parent can do -- and this is from a parent -- is to make your children invest themselves in the college experience and make them pay some. In my case it was half," he says.

"They're incentivized to try and get scholarships because they know that is part of their half," says Yrizzary.

With a solid foundation of financial literacy education, kids should know that avoiding loans, if at all possible, is in their best interest.

That said, it's easier for kids to get student loans than it is for parents to get loans to fund their retirement. Parents should not consider saving money for college unless their retirement funds are already flush.