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Parents, how do you pay for college ?

BunnyWuBunnyWu 6 replies1 threadsRegistered User New Member
Hi all, i am wondering how middle class families paying for college? We have one smart kid who currently in middle school. Our State schools are great cost of attending is about 25k which we can afford but what if he wants to try the Ivy League at 70k/year? Do we even allow him to apply and if he miraculously get in we can only help him half way? We wont be eligible in any of base need and FAFSA. Thank you for input.
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Replies to: Parents, how do you pay for college ?

  • TiggerDadTiggerDad 1894 replies70 threadsRegistered User Senior Member
    Run the Net Price Calculator, projecting the situation the year of your son's college application, with each of Ivy League schools that you and your son are interested in. Depending on your income, investments and assets, family size, number of siblings in college, home equity (Harvard and Princeton don't consider this), etc., your affordability can fluctuate quite a bit. For "middle income" families (don't know what your definition of "middle income" is), you could very well end up paying less than the in-state schools.
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  • cptofthehousecptofthehouse 29423 replies58 threadsRegistered User Senior Member
    As to how to start the process, find out how much you, as a family, are expected to pay for colleges at various schools. You are way early, but to get an idea how much you’d be expected to pay for college in the 2020 school year, pull out your 2018 income tax returns so you can use those AGI figures which are relevant, and fill out some NPCs for a number of schools. What does your state flagship expect you to pay right now? What does Harvard expect? How about Hardwick College? Or Haverford? Fordhsm University? An Out of State public that interests you? Your spouse’s and your alma maters?

    That would tell you what you’d be facing in costs if you had a high school senior applying to colleges this year.
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  • BunnyWuBunnyWu 6 replies1 threadsRegistered User New Member
    edited September 15
    I did run the Net Price Calculator most are projected us to pay anywhere from 75,000-100,000 /year.
    edited September 15
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  • rickle1rickle1 1938 replies17 threadsRegistered User Senior Member
    Put away as much as you can now. Make it a habit like any other bill. You can do this without sacrificing too much. You'll amass a pretty decent number. Based on academics and ECs, your kid may get some decent merit money at really good schools. Add that to your savings and you may have some interesting options outside of your state schools if that is of interest.
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  • artloversplusartloversplus 8566 replies250 threadsRegistered User Senior Member
    edited September 15
    Here is a possible scenario, all the top schools look at FAFSA and CSS, some times they have their own version in addition to the two, if you have too many assets or have a big 529, you are not going to get any need base aid.

    I, for example, had an EFC of around 40K, but css showed a large 529 and other assets, so we have to pay full COA, the only thing we could do is loans if we really need it.
    edited September 15
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  • lookingforwardlookingforward 34196 replies378 threadsRegistered User Senior Member
    Don't overlook colleges that offer strong merit awards. But please understand that doing welll in middle school is a far cry from the challenges of high school. Plus, what it takes to get into top colleges is A LOT more than grades and a few school activities.

    The best plan may be to get him aware of the great opportunities at a range of colleges. Sometimes, that's just talking about them. Let him experience some events on campus at your state school, whether a football game or some other happening. It demystified things for my kids and made them aware there's lots more to college than classes.
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  • BunnyWuBunnyWu 6 replies1 threadsRegistered User New Member
    7. How do you know you won’t be eligible for any need based aid? Is your income that high?
    Yes. We wanted to retire early.

    6. How many kids do you have to consider? If there are younger siblings, don’t forget about them.

    5. I agree...save. Save now. If you think you can contribute $2000 a month towards college costs, put that in a dedicated savings starting this month. Do it for at least 6 months...and decide it you think it’s sustainable for four years of college.

    Oh...and if this savings plan seems to work...then continue to do it. In four years, you will have about $100,000 in college savings which would be great for one kid.

    We have been saving the day he was born into 529 we have Significant amount in it but at current point price in private school it would only pay for 2 years.

    4. Your kid doesn’t have one high school grade yet. There is no way to even predict what colleges he will or won’t be a strong candidate for in terms of acceptance.

    You are right, as for now we treat state schools as a fall back place to go. We would like him to go toward to private ones since the chance of graduating with 4 years s higher than state schools.

    3. Tell us what you think “middle class” means in terms of annual income, and assets.

    Less than 300k , 800k assets?
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  • GumbymomGumbymom 27869 replies155 threadsForum Champion UC Forum Champion
    Our family’s strategy with an EFC of $60K for 1 in college and a little over $30K for 2 in college.

    1) We did not plan to depend on Federal aid, State aid or merit to fund our son’s college. Started a College savings plan when they were born.

    2) Birthday money from family and Grandparents went into this fund along with an automatic contribution each month. First, we started of small but each time either my husband and I got a raise at work, we would contribute more to the college savings plan and our retirement so our spending remained in check.

    3) We are not extravagant individuals and we did take some nice vacations but nothing over the top. The boys loved camping so many years were spent on good family fun with a minimal expense.

    4) Both son’s were given a budget based on what we had saved and any additional we could contribute from our current earnings or savings.

    5) If they wanted a school more expensive than the budget, they needed to find merit aid and work to make up the difference.

    In the end, both son’s chose states schools where their 4 years Undergrad was covered by the 529 plan.

    Both came out with no debt which gave them the freedom to accept jobs that were in their field of study but may not initially pay well at the beginning.

    Older son now working with good benefits after 2 years in his field doing many temporary/seasonal positions but accumulating much needed experience.

    Younger son was able to get a good paying job right out of college and doing well a year later.
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  • thumper1thumper1 74816 replies3279 threadsRegistered User Senior Member
    I, for example, had an EFC of around 40K, but css showed a large 529 and other assets, so we have to pay full COA

    @artloversplus please don’t mislead this poster. Your 529 accounts were counted as parent assets in the FAFSA formula as well. Most “other assets” are also counted on the FAFSA with the exception of the primary residence (your kid went to a school that only uses the FAFSA now...although maybe that was not the case when she was an undergrad).


    If your family income is close to $300,000, you won’t be receiving need based aid no matter how small your assets are.

    $800,000 in assets? Is this just regular savings, or what? If you pay off your car and house to the tune of $65,000 or so...this really isn’t going to make a dent in your financial aid picture if this $800,000 is regular assets. Plus, like I said, your home equity is possibly going to matter at some colleges.

    With regard to graduating in four years...a lot depends on your kid...and not the college. If your kid keeps on track, and doesn’t lose credits anywhere along the way, the kid will graduate in four years. Many, many graduate in four years from public universities. Many.

    Please don’t treat your public instate universities like “fall backs”. They are likely excellent options.

    What state?
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  • KnowsstuffKnowsstuff 4249 replies17 threadsRegistered User Senior Member
    edited September 15
    We were in your shoes with two kids in college now. 529 plans since age 6 but we put us first and put a decent amount in retirement plans. We own our own business.

    So kids got combo of merit, financial aid since we have two in college and current income.

    You might also need to stop putting money into retirement and concentrate on your child to build up that half amount quicker. That's pretty much what we did and it seems to be working. We also only had like half in a 529 plan.

    But I gotta tell you when my daughter got half merit when she switched Lacs that "extra" money is going to him that we were going to use for her. Plus kids can get scholarships but DON'T count on that. That is just the cherry on top if it happens.

    As far as which schools he should go to. Start talking about that now and about school costs. Don't say "we will worry about costs later". Give realistic expectations now. If you can't afford $70 000/year for college then join the club. Many other great schools that don't cost that much. Ivys are just a few schools out of thousands.
    edited September 15
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  • NYDreammomNYDreammom 334 replies0 threadsRegistered User Member
    1. Get substantial merit/talent scholarship. 2. Live at home. 3. Use current income to make monthly payments on college payment plan.
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  • kiddiekiddie 3409 replies216 threadsRegistered User Senior Member
    Live on only $200K a year and save $100 a year over the next 6 years. Then when they are in college you still live on $200K a year and use the rest to pay tuition (along with what you saved).
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  • lookingforwardlookingforward 34196 replies378 threadsRegistered User Senior Member
    Taxes make 300k into less.
    But let's make this clear. No matter what you want that you cannot afford, 300k income and 800k in assets is not "middle class." It's pressing the bottom of the top 1%.

    Monies in "Qualified Retriement Plans" are not considered when counting assets. Has to be a QRP, not self-designated.

    For the record, some formulas do consider the age of the older parent, how close to retirement. But that income is above even Harvard's cutoff.
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  • cptofthehousecptofthehouse 29423 replies58 threadsRegistered User Senior Member
    Okay, so you now know that you aren’t going to get any aid except maybe at those schools that cost over $70k. How much are you willing and able to pay?

    You have some 529s in place. That will cover some of the costs. How much are you willing to take out of your savings,, how much can you tighten your daily living budget to pay out of current income towards college for the next several years?

    Then the question comes about how much would you be comfortable borrowing? Borrowing is not terrible when you do so with a realistic plan for repayment and you can afford to do so.

    We borrowed $45k each year for 4 years for my oldest. We did this because we had other kids in private schools, activities and some special needs that we wanted to continue. We also had had some exceptional expenses and were looking at high cash flow out of the house on some things we felt were important for the time and the future. We did not want to take money out of savings or retirement funds. We did not want to move to less expensive dwellings. It was decided that stretching $45k into a ten year commitment leveraged everything wanted to do even with interest involved. So we took out that PLUS (parent loan)and Son took out Direct Loan of $5500 and we immediately started paying both back on a ten year repayment plan. We did the same each year for four years and had about 10 years of payments on our end of the loan after 4th year. Student loan got repaid early.

    Our second child got a scholarship and went in state, so he actually cost us less for college than he did while in high school.

    We repaid the loan in full by the time the last kid started college, and struggled to pay his private college costs, and did so with some family help—all the older siblings, mine and his contributed, and he worked summers and during the year covering all his expenses—got free room and board his senior year.

    We did not expect to get financial aid. It was our choice to live as we did and send our kids to private schools, expensive activities, and to colleges that were more expensive than need be. Every single one of my kids had low cost, some of them free college options. We CHOSE to go a more expensive route. We chose to live where we did.

    So look for some. low cost options, state schools, merit money. It appears as though your student has some possibilities for good merit money. It may be the case that one kid or other needs more than the usual amount of money or attention. Things do happen where it’s good to have the funds to address such issues.
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