If you have children, you've probably thought about how much it will cost to educate them. The fact is, the world is turning into a place where a college degree is necessary.

Did you know that even many cowboys are expected to have animal science or business degrees nowdays?

And with demand up, prices go up. The cost of college is getting more and more expensive. If you have a newborn, in 18 years, public college is expected to cost in excess of $100,000, while private school will cost over $200,000.

The sooner you start investing in your child's education, the more time your investments will have to grow.

But let me start off by saying, you are better off saving for your retirement as well. You don't want to only focus on your child's education. You will need much more to retire. If it is one or the other, always choose your retirement. Your child will be able to work and get loans, if necessary. When you reach retirement, you will need your savings.

Okay, so how do you save for your child's education?

The first step is to estimate what the cost will likely be? The average in-state tuition for a public school now averages over $10,000 per year. At a 5% yearly inflation, the estimated cost in 18 years would be $24,000.

Private schools are often two to three times as costly as public schools.

Now don't start to panic. If you save early, contribute regularly and make wise investment choices, you should be able to save enough. If not, your child can find scholarships, financial aid and loans.

It used to be that we saved for our children with a passbook savings account. I remember my first little blue book and the weekly trips to the bank. However, times have changed. Do that as a token for your child to learn to save. But don't put their college funds in a passbook or money market account.

In order to save enough for four years of tuition, you will need to start early and invest aggressively. Stock funds are historically the best performer for investments of ten years or more. You want a no-load mutual fund with low expenses.

But you don't just put the money in and leave it there. You should keep an eye on it. Review the fund at least annually. When funds are under-performing, you need to make adjustments. When your child begins high school, you need to start shifting your money to less aggressive and more conservative investment options, such as growth and income stock funds and bond funds. This reduces your exposure to market fluctuations, but still gives you high returns.

Sometime during early high school, cash in enough stocks and bonds to pay for the first year of college. Put it in a safe place, like that passbook account. Don't wait until you absolutely need it, the market may be down then, causing you a loss of earnings.

It depends on your situation, what vehicle is best for your investment. You may choose a Roth IRA, an Education IRA, a state college savings plan or a Pre-paid tuition plan. Research your options thoroughly. For example, many plans have limits for growth.

You should begin saving for you child's education as soon as possible. Think how nice it would be to pay for college without having to go into debt. Your child could start life in the "real world" without student loans. If you have a plan and stick with it, you can make it happen.