First, the good news: If you start saving early and contribute often, your baby's college fund will grow exponentially by the time she's graduated high school. Even in this volatile and unpredictable market, with interest rates compounding and dividends reinvesting over the course of seventeen or eighteen years, you could build up a hefty fund. The bad news? That baby's going to need a lot of tuition money: $34,000 for a public college or university; $84,000 for a private school, in today's dollars.

With eighteen years to build a college fund, Kiplinger Online (www.kiplinger.com) recommends investing in stocks or stock mutual funds, with 75 percent in domestic stock and 25 percent in foreign stock. You're probably too busy (and sensibly wary) to trade your own stocks, which is why discount brokerage houses- such as Dreyfus, Fidelity, Vanguard, to name just a few- offer a full selection of mutual funds. A mutual fund is a pool of individual stocks (typically fifty or more companies) that's managed by professionals. The idea is diversity, so that if one stock drops in value, the overall portfolio doesn't suffer. A "growth fund" simply means that the fund manager's primary objective is growth of capital. "No-load" means you pay no fees. Look for a no-load, growth mutual fund. The fund may be set up as a custodial account in your child's name under the Uniform Gifts to Minors Act (UGMA) or the Uniform Transfers to Minors Act (UTMA), depending on the state in which you live. Other options include Educational IRAs and the UNIQUE College Investing Plan. Research the possibilities on web sites that are not trying to sell you their own line of products. Independent advisors include Kiplinger; www.smartmoney.com; www.morningstar.com; and the fun and informative "Motley Fool," at www.fool.com. Finally, before choosing any fund, consult with a tax expert to be sure it's a good fit for your situation.

What's the bottom line? Ideally, you'll start investing early and contribute continuously. If you're saving for a private-college education, Fidelity's College Cost Calculator (available on their web site at www.fidelity.com) estimates you'll need to save $320 per month, every month, for the next seventeen years. For a public university, the monthly amount is $129. If your current portfolio is tied up in liquid collection assets (i.e., diapers), financial experts recommend investing as much as you can on a monthly basis, and adding lump sums whenever you can. To extend the diaper metaphor, if you can endure the constant changes, eventually you and your child will be ready for the next step in her development. And if nothing else, once she's toilet trained, invest the diaper money.