New baby in the family? You might want to think about college. No kidding.

With costs continuing to rise at both private and state-supported universities, parents face escalating budgets for even the basics.

Sim Mosby, a certified public accountant and family planning specialist, suggests families with young children investigate the options available and start the investment while there still is time for the interest to build.

&uot;There are three or four options other than just putting money away in a savings account,&uot; Mosby said. &uot;And it’s never too early to plan for your children’s education.&uot;

The primary options are:

Education IRAs.

Section 529 plans, including the state-sponsored plans.

Savings bond programs.

&uot;Most all banks offer the IRA programs,&uot; Mosby said. &uot;Right now you can set aside $500 per individual beneficiary, but that contribution limit is going up to $2,000 next year.&uot;

Some income limits exist. For example, a married couple with an adjusted gross income of more than $160,000 is not eligible for the full contribution. That ceiling will change in 2002, however, when it rises to $190,000.

The state-sponsored Section 529 plans are known as MPACT and MACS, standing for Mississippi Prepaid Affordable College Tuition Program and Mississippi Affordable College Savings Program. Parents and others can get all the necessary information on the programs by calling the state Treasury Department at 1-800-987-4450.

The MPACT program is designed for the family to pay a flat monthly fee or all the payment at one time. &uot;It guarantees a certain amount of tuition and there’s a wide range of things you can buy into,&uot; Mosby said. Those include two years of community college up to four years of a university.

The MACS program is open to anyone, with no income limit, and is deductible up to $10,000 per person or $20,000 for joint filers. &uot;This is a really flexible program and it grows tax free. Also, in 2002, the state program plans will have the distributions excludable from income,&uot; he said.

The use of savings bonds to save for education is not as widely known, Mosby said. &uot;If you’re over age 24, you can buy bonds. You have to buy them in your name. When you redeem them, they are not taxable if you, your spouse or your child use the funds for qualified higher education.&uot;

Another feature of the education IRA when the new law takes effect in 2002 is that a family can take money from the account to use for elementary or high school tuition. &uot;But if you do this, and take the money out of the IRA, you aren’t leaving the money there to grow for college,&uot; Mosby said.

Some families simply do not plan to assist the children with college education, he said. For those children, some good counseling on financial aid is in order. However, families who want to save cannot begin to soon.

&uot;Money makes money, and the more you put in these vehicles, the more it’ll grow, and the sooner you put it in, the better.&uot;

&uot;If you put it in the IRA, let it grow. It will grow tremendously by the time your child goes to college.&uot;