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Many new parents want to pay for their child鈥檚 college education, but it鈥檚 hard to know how much money they鈥檒l need 18 or 19 years in the future. The type of college your child goes to, education inflation and many other variables affect how much you need to save.

But don鈥檛 let perfect be the enemy of good. With some thoughtful planning, you can come up with a reasonable estimate of your 鈥渕agic number鈥� for听. Following are some important considerations as you start planning:

• Type of school:听The cost of attendance varies greatly depending on whether it鈥檚 a two- or four-year, public or private school. Costs ranged from around $11,000 to about听$44,000 (including room and board) per year in 2015,听.

• Room and board:听Room and board, which accounts for a large portion of the cost of attendance, is one area where you can save money. Having your child live at home for the first year or two may help you save enough to pay for a year鈥檚 worth of tuition.

• Inflation:听According to the College Board鈥檚 recent study, prices increased by about 3% from the 2014-2015 school year to the 2015-2016 school year. But there is no guarantee this rate of inflation will stay the same. It鈥檚 best to err on the side of caution and choose a relatively high rate of inflation 鈥� say, 5% 鈥� as you calculate how much money you鈥檒l need to save.

• Price actually paid:听Many students don鈥檛 pay full price because of institutional and federal grants and tax benefits. The College Board found that for a four-year public university with a list price of $19,550 for the 2015-2016 school year, the average in-state student actually paid only $14,120. Private university students also saw a significant discount from a list price of $43,920 to $26,400. Though it鈥檚 difficult to know exactly what discount your student can count on, planning on a 20% to 25% discount is often reasonable. (To maximize the potential for grants and financial aid, you may need to do additional planning regarding your income and how assets are held, since some accounts are treated more favorably than others when applying for aid.)

• Your child鈥檚 contribution:听Many parents believe that their children should help pay for school through work or听. On the bright side, this can motivate and engage the child. However, if you decide to have your child contribute with student loans, make sure he or she is aware of the risk and burden involved in taking on debt. Graduating with too much student debt can limit your child鈥檚 ability to move to a new city or take jobs for the experience.

• Family contributions:听Some grandparents agree to pay for some or all of their grandchildren鈥檚 education expenses. This is an incredible burden lifted and makes planning easier for these families. But not all families have this luxury. Most fiscally conservative parents will not count on the help of family unless that help听is just a couple of years away. Talk to your family to find out whether this is something they are interested in or able to do. If they are, you鈥檒l want to do some additional legwork to make sure the听.

Magic number example

To see how all these factors affect college planning, consider this example. The Johnstons want to plan for college for their new baby, and they already have a school in mind. The estimated in-state cost of attendance for 2016-2017 at the University of Minnesota is about $26,482 in total per year. They decide to cover tuition for four years, but plan for a 25% discount to the listed price and to have the child be responsible for room and board, plus books and other personal expenses (around $12,200 of the $26,482). If necessary, their child can live at home to reduce costs.

Here鈥檚 how the Johnstons arrive at their magic number:

• They determine the portion they鈥檒l cover per year, or $26,482 鈥� $12,200 = $14,282.
• Plan on a 25% discount to the list price, or $14,282 x 0.75 = $10,711.50.
• For four years, that鈥檚 $10,711.50 x 4 = $42,850 (rounded up).
• Then they adjust today鈥檚 cost for possible inflation at 5% over 19 years, or $42,850 x (1+0.05)^19听 = $108,280.

With听a 7% rate of return on their college savings (a reasonable assumption based on听historic Standard & Poor鈥檚 500 index returns and a 70% to 80% equity portfolio), it will require saving $228 per month to reach their goal of $108,280 in 19 years. For a middle-class family like the Johnstons, it is difficult, but doable.

If the Johnstons waited to start saving, they would have to save significantly more each month. For instance, assume that they have only 10 years to save for college. Instead of $228 per month, they would need to save $625 per month, assuming the same costs and returns. This is a lofty goal for anyone. And in fact, they may need to save even more than that. As they get closer to the start of school, they will most likely have to reduce risk in their portfolio and, as a result, reduce their potential return.

Be flexible

Of course, the Johnstons also realize that they will have to review their plan every so often and make adjustments as needed. If baby Johnston wants to go to the top engineering school in the country, it will most likely cost more, and living at home won鈥檛 be an option.

Planning for college savings must be an ongoing process, and talking with your spouse and/or an advisor early on can be invaluable. To come up with your magic number, you鈥檒l need to do some research to determine what numbers to start with, but don鈥檛 fixate too much on one particular school or number. Plan for your best guess, but be flexible.

Unless you have unlimited resources for college, you should set up a reasonable plan for savings, make periodic adjustments as necessary and make the most of what you have.

听, CFA, CFP, is a fee-only planner with听听in Chanhassen, Minnesota.听Learn more about Mark听on NerdWallet鈥檚听.

This article also appears听on听.

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