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As a financial advisor, I frequently see families take on huge amounts of debt to pay for a child鈥檚 college education. In many cases, the debt becomes a long-term financial burden for students 鈥� and sometimes their parents, too.

With proper planning, this needn鈥檛 be the case. Here are some tips to help you plan聽college financing so your children can avoid excessive student loan debt and you can avoid disrupting your financial plans.

1. Start saving early

Accumulating significant is not as hard聽as it sounds, but it requires a firm commitment early on. If your kids are still young, start saving today; you鈥檒l be in a strong position financially when they reach聽college age, and they聽may be able to avoid student loan debt entirely.

Parents who start saving $250 a month in a child鈥檚 college fund at birth and increase their contribution by 3% each year could accumulate $134,000 by the time the child enters college, assuming an annual average investment return of 7%. That would be nearly enough to pay the average cost for four years of state college tuition, fees, room and board, assuming that today鈥檚 cost (about $80,000) also increases at nearly 3% per year. It also would be enough to put a serious dent in the cost of a private college.

2. Set a budget and stick to it

According to a 聽from Discover Financial Services, a provider of credit card, banking and loan services, fewer than half of parents said they were limiting their children鈥檚 choice of college based on price. But it鈥檚聽important to be realistic about what you can afford and to discuss it with your children聽well before they start applying to聽colleges.聽Once you set a limit for what you can handle, your children can still apply to schools that are out of your price range 鈥� but with the understanding that they聽would also need to receive merit aid to attend.

3. Avoid private loans

Only 30% of the Discover survey respondents considered themselves very knowledgeable about the differences between聽. But it鈥檚 important to understand the key ways in which these two types of loans will affect your student鈥檚 finances after graduation

Unless your family has the resources to pay for the entire cost of college out of savings and current cash flow, you should file a , or . No matter how much money parents make, students will qualify at a minimum for unsubsidized federal Stafford loans, and the FAFSA is key to unlocking those funds. Unsubsidized loans carry the same interest rate and terms as subsidized government loans, but interest will accrue while the student is in school.

Students should always tap out federal loans before taking out聽private loans, because they provide much more lenient repayment terms, including the opportunity for deferments, extended terms and income-based repayment schedules.聽聽usually offer little聽flexibility in repayment terms.

Private loans also often require parents to co-sign. This can be a bad idea. Co-signing puts parents on the hook for the entire loan balance if聽the student can鈥檛 pay the loan. While students have a lifetime of income to make payments, parents may have only a few working years remaining and often cannot afford this type of long-term financial commitment. Students should resort to private loans only after they have exhausted all other sources of funding and only after they have carefully considered the long-term implications of that debt.

4. Develop聽an aid strategy

Families with greater need may qualify for subsidized federal loans and work-study programs, which can help defray some of the cost. While only the neediest families will qualify for federal government grants, many schools may offer grants, scholarships or special loan packages based on a student鈥檚 financial need. (Note: Some private schools require students to file an additional form to apply for need-based funds from the institution.)

Many students also find that with the help of聽,聽in the form of grants or聽聽money, the cost of some private schools is not much more than the cost of a state school. Schools offer this money聽to the students they most want to attract, which means the top third of candidates will likely receive much better offers than the bottom third. To maximize your children鈥檚 chance of landing a good merit aid package, focus on schools for which they are聽slightly overqualified.

5. Make a college spending plan

As your children get closer to attending college, plan where the money will come from for each year of school. Look at how much you can pay for with regular cash flow; how much is available from savings and investments, financial aid, loans and work-study awards; and how much your students聽will be able to contribute from聽part-time jobs. What if your聽children聽need a fifth year to graduate or require postgraduate education to achieve their聽goals? Where will that money come from?

Also consider how much debt will accumulate over the course of your children鈥檚 higher education. It鈥檚 important to think realistically about the impact that debt will have on them. If they聽won鈥檛 be able to cover student loan payments, based on their聽expected income after graduation, you may need to consider a lower-cost strategy.

6. Don鈥檛 derail retirement planning

If you have been saving aggressively in your employer-sponsored and your retirement plan is on track, you might consider borrowing from your employer plan. This would allow you to tap your retirement funds without incurring taxes or penalties. Typically, you must repay the loans over five years through payroll deductions. This may seem like a good idea because you pay yourself back with interest, but be careful. If you leave your employer, you usually have to repay in full or the IRS will treat any unpaid balance as an early distribution, with income tax and early distribution penalties if you are younger than 59陆.

In my practice, I find that many parents either borrow money themselves, through or ,聽or assume all or part of their kids鈥� debt burden after graduation. You might be able to afford the debt payments today, but will that still be the case after you retire? And if you are behind in , taking on debt to pay for your children鈥檚 education may prevent you from having the cash flow you need to catch up during these all-important final working years.

Parents should be very cautious about taking on debt or tapping retirement savings to help their children pay for college. Remember, thinking of your own needs is not being selfish. Attending a less expensive school won鈥檛 ruin your child鈥檚 life, but taking on too much debt and not saving sufficiently for retirement late in your career could irreparably damage聽your future financial life.

7. Help your kids understand debt

I find that soon-to-be college students have no idea how will affect their finances. Too often, the resulting college degree doesn鈥檛 increase the students鈥� income potential enough for them to easily cover student loan payments. But kids have little experience with budgeting a monthly income and therefore no basis on which to make rational decisions regarding student loan debt.

By working with your children on a realistic budget based on their聽expected earnings after college, you can help them聽begin to understand how debt will figure into their聽financial future. That doesn鈥檛 necessarily mean you should let your children make the decision alone about how much debt to take on.

8. Consider a community college

This is probably the single most effective way to reduce the total cost of a college education. Kids often chafe at the idea, but if the money isn鈥檛 there, they will be far better off with two years of community college than borrowing heavily in their freshman and sophomore years. In most states, students with good grades can transfer to a state school to complete a four-year degree.

In the long run, your students鈥櫬爁uture financial position is much more important than senior-year bragging rights. True, your children may not have the typical college living experience for the first couple of years of their higher聽education, but I guarantee there will be plenty of time for raucous parties later on.

Next steps

If you need help creating a financial plan for college, consider working with a financial advisor. An advisor can offer college-planning tools to help you clarify college finances. Your advisor can help you determine how this expense may fit into your retirement plan while also helping your child avoid taking on overwhelming amounts of debt.

聽is a certified financial planner and the founder of 聽in New Jersey. This article first appeared at . Learn more about James at NerdWallet鈥檚 .