Another factor, Ms. Hume said, could be confusion over how a 529 account affects a student's chance to receive appropriate financial support.

The effect depends on who owns the account. Study grant experts say the effect is generally minimal if a parent has the account in favor of a dependent student. However, the impact can be significant if a grandparent owns the account – however, there are several workarounds, said Mark Kantrowitz, editor of

Parents waiting for their child to be 7 years old start saving"We have to save a lot more out of our own pockets to achieve our goal," he said.

"Your greatest asset as a parent is time," said Kantrowitz.

In fact, parents could open an account before the birth of a child, identify themselves as beneficiaries, and change the beneficiary's name after the birth. Mr. Kantrowitz said he did this for his children.

As with any investment, profits are not guaranteed. However, if investors start early, they will have more time to overcome the inevitable market fluctuations. However, some age-based portfolios are more aggressive than others. Savers should therefore review the details of their plan to ensure that they are familiar with the mix of investments when their child approaches college. If you can't stand losing money, many 529 companies offer lower risk and lower return options, including savings accounts insured with the Federal Deposit Insurance Corporation and certificates of deposit.

Saving has become more important as college costs have increased and student debt is a bigger problem.

The published average cost of tuition, room and board is $ 22,000 a year for domestic students at public four-year colleges and $ 50,000 for private, non-profit four-year colleges, according to the College Board. (The totals do not include fees and expenses such as books and equipment.)