It’s the begin­ning of the school year and you’re think­ing about your child’s future edu­ca­tion. Your child is bright and will be going to col­lege, so the time to start plan­ning is now.

Many par­ents begin plan­ning for col­lege early to cre­ate an edu­ca­tion sav­ings account for their child’s edu­ca­tion. How to save for your child’s edu­ca­tion is the big ques­tion that is asked, as there are many dif­fer­ent ways to save for edu­ca­tional pur­poses. One poten­tial prob­lem with an edu­ca­tion sav­ings account is tax­a­tion and asset respon­si­bil­ity as it per­tains to finan­cial aid eligibility.

There are some dif­fer­ent meth­ods par­ents and grand­par­ents can use to save for a child’s edu­ca­tion. It’s impor­tant to con­sider tax­a­tion, eli­gi­bil­ity and growth aspects of the dif­fer­ent sav­ings plans. Many finan­cial advi­sors rec­om­mend plans that are more aggres­sive and risky in the early child­hood years, but con­vert­ing over to more con­ser­v­a­tive tac­tics in the years that are closer to the start of col­lege. One rea­son is that there is less money to risk in the begin­ning, so higher risk invest­ments are accept­able. In years closer to the start of col­lege, any edu­ca­tion sav­ings account risks should be min­i­mized to con­serve the larger amount of sav­ings accumulated.

There are four major meth­ods used to fund col­lege expenses:

» Read more: The Best Ways to Save Money for Your Child’s Education