Ideally, retirement should be a time to relax, putter around the yard or have the leisure to travel. For more and more people, however, retirement planning is complicated by the knowledge that they are very probably going to be responsible for putting their grandchildren through college as well.

According to statistics from the 2000 U.S. Census, 6.3 percent of children under 18 live in households headed by a grandparent. In many cases, a grandparent is also the custodial parent, either through death, abandonment or the incarceration of their adult children. For many grandparents, the financial burden of raising a second set of children is already heavy, and as the grandchildren approach college age it may seem overwhelming.

Age Before Education
The good news is this: We are a society that values higher education, and there are more options than ever for putting a child through college without having to sacrifice a comfortable old age. But first and foremost, experts agree, retirement planning must take precedence over college planning.

"The priority should be on retirement because there is an increasing array of aid programs available to students through colleges, community aid organizations and the government," says Gail Liberman and Alan Lavine. "Kids can also work while they go to school, they can save money by living at home and they have their whole lives to catch up. The grandparents have no one else to turn to, so their retirement security is paramount."

Liberman and Lavine, syndicated columnists and the authors of Rags to Retirement (Alpha Books, 2003), note that one big misconception that many people have about getting college funds is that you have to be a good student. In fact, most financial aid is based upon need, not grades.

Furthermore, while attending state or local colleges may save money, Paige Chadwick and Laura Grey of NextStudent, a free college funding support service, advise that grandparents not pay attention to tuition when first looking at colleges. Focus on the college that will best serve your grandchild, or that your grandchild is wanting to attend; then look at funding options. Only then, if the options aren't there, should you begin to look at less expensive college options.

One thing to keep in mind: You should never have to pay for financial aid or scholarships or to search for them. If any program or Web site asks for filing fees, tracking fees or processing fees, they're just out to make a buck. All of this information is free and available to anyone.

Below is a comprehensive roundup of programs that can help pay for college. The first four are for grandparents who have grandchildren going to college soon. The last two offer longer-term funding options for grandparents who are raising younger grandchildren.

FAFSA
This is the absolute first step in any college search. Free Application for Federal Student Aid (FAFSA) is filled out by all prospective college students, regardless of income, and sent to the college(s) the prospective student is interested in. The results of this application qualify the student for low-cost loans, as well as establishing a baseline for the college to work with when awarding scholarships, grants, work study, etc.

Student Aid on the Web
Maintained by the federal government, Student Aid on the Web is a comprehensive guide to loans, grants and other funding options.

PLUS, Pell and Stafford
These terms are three anyone looking for college funding will become very familiar with, because they are the primary non-scholarship sources of college funding. A Pell grant is a federal need-based grant (which means it doesn't have to be paid back) that provides up to $4,050 annually based on the student's financial need. Qualification is determined by FAFSA.

A Stafford loan is a federal loan program for families who qualify for financial aid. The government pays the interest on the loan while the student is in school. It is actually a loan to the student, not the grandparent, and the student pays it back after graduation from college.

A Parent Loan for Undergraduate Students (PLUS) is a low-interest, federal direct loan taken out by the parent or grandparent on behalf of the dependent student. It is generally non-needs based, but Chadwick and Gray of NextStudent point out that it's still far preferable to taking out a home equity loan or dipping into that 401(k) because of available low-interest rates and tax breaks.

NextStudent, FinAid, FastWeb
NextStudent, FinAid and FastWeb are the three largest, free, private search engines for scholarships and other forms of aid. NextStudent also offers free financial advice and can help grandparents compare funding options.

Upromise (www.upromise.com)
Think of Upromise as a rewards program that isn't tied just to any one service or credit card, but to virtually every purchase a family makes. This is a particularly good program for grandparents who are raising younger grandchildren and are looking further into the future for college. Upromise spokesperson Catherine O'Rourke says that anyone can register on behalf of a child – grandparents, parents, neighbors, uncles, aunts. Statements are sent quarterly, and the funds are often put into a 529 Plan for future use.

529 Plans
Like Upromise, this is a great idea for those who are raising younger grandchildren. Named after Section 529 of the Internal Revenue Code, these are state-sponsored programs designed to help parents finance education expenses. However, a 529 Plan can be opened and contributed to by anyone, just as in the above scenario. The proceeds can be used only for education. The tax advantages of these plans are significant.

There are two other important points that are worth making. First, start the scholarship searches as soon as possible – when the child is a junior in high school is best – because most have deadlines and require a great deal of paperwork on the child's part, such as teacher recommendations. Second, it can't be reiterated strongly enough that information on college funding, filing paperwork and tracking applications is always free, all the time. If you come across a site or service that charges a fee, it's almost certainly a scam. Instead of paying for something you can do yourself, put that money toward books.

Want to see more?

• Retirement Fund vs. College Fund: Do Grandparents Raising Grandkids Have to Forfeit Retirement?
• Tough Love: Living With Your Child and Grandchild
• College Bound: A Timeline for Success
• Talk about it!