Suze:: Even if you're starting late, the important thing is to start—but you need to take the time to plan the right way to save. Desperation can lead to rushed, unsafe investments, and the worst thing you could do for your daughters would be to put your money at risk in an attempt, as you say, to play catch-up. The expenses of college are daunting, and for many parents—especially those with more than one child—the thinking is, 'I'll never manage.' You need to get out of that mindset, because saving for college can begin with a few very simple actions.
Since you know you'll need to begin spending your savings in four to five years, be conservative. Keep your money in high-yield money market funds (you can find the ones paying the best interest rates at www.ibcdata.com), treasury notes, certificates of deposit and series EE bonds. The steps to open these accounts are quick and simple and can be completed right at your local bank, but you need to start very soon. You should also remember that as the cost of higher education increases, both the government and colleges are beginning to offer more financial aid in the form of grants, loans and work-study programs. More than half of all undergraduate students are awarded some form of financial aid, so the odds are you won't have to shoulder the financial burden on your own. The most important thing, though, is for your daughters to see you taking responsibility for your money. True education starts with messages that are passed down.