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But parents can take advantage of several college savings tools to help meet this steep challenge. Consider these five possibilities:

1. Section 529 plans: Section 529 plans, sponsored by U.S. states, encourage families to set aside funds for the future education expenses of beneficiaries. The contribution limit usually is at least $300,000. As long as certain requirements are met, your investment can grow without current taxes, and distributions made for qualifying college expenses—including tuition, fees, books, supplies, equipment, and room and board for full-time students—also are tax-free.

There are two main types of Section 529 plans: (1) prepaid tuition plans that let you prepay the cost of attending college years down the road at current rates and (2) college savings plans, whose assets are invested according to your preferences.