College long term costs

Paying for College
61

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Me, too. Somebody with this much money and Yale connections could easily afford all kinds of expert and/or shady college financial planners, and would not be posting their personal financial business to a message board they just joined yesterday.</p>

62

<p>^^ I am not sure about how Pell works but each school is different for FA.
Very few schools ignore all the money that is in IRAs since technically it is available to pay for college without a penalty. So OP’s plan even in 2013 can work only at very few elite schools.</p>

63

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He’s made the decision to drop out of the rat race and (presumably) raise his child. You are judging him for wanting to do this.</p>

<p>Yet, I bet you would never judge a mother who decided to stop working and become a SAHM, even though she could just as equally “keep on working and be (a) productive individual contributing to something and continue to make things happen”. You would never accuse her of “throw(ing) away the opportunities for even bigger and more impactful outcome in the later part of your career”.</p>

<p>It’s a double standard.</p>

<p>And it is irrelevant how much money he has.</p>

64

<p>You couldn’t possibly have knowledge of much of what you are saying about OP. I don’t even know if OP is a he or a she. Keep building your straw man and put words in my mouth, not sure why you are giving me a hard time and changing the subject to gender equality… What ever, makes your millions and game the system so you can retire at 45, it is a free country.</p>

65

<p>Read post 35 where the OP refers to his DW (who does not want to fund grad school costs). </p>

<p>I agree it doesn’t matter the gender of this OP…but it seems he is the dad.</p>

66

<p>Thanks for all the feedback, both critical and constructive. I respect all points of view and even if I disagree with some of them, they are useful feedback for me to reflect on. Looks like I generated a lot of debate but not the debate I wanted. I really had hoped to hear feedback on long term college cost assumptions not my early retirement financial planning. I guess I can make a few points clear.

  1. I am the Dad and not the Mom. I am very interested in “getting out of the rat race” based on the wealth me and my DW created as I want to spend more time with my DS and other non-work related pursuits. My DW seems more interested in staying in the workforce more out of personal pride. I enjoy my work a lot than she does but she seems to take a lot of pride in her career. This is why we will have a semi-retirement phase of our plan so we can wind down our work. It could be that she still retains her work even after I fully retire.<br>
  2. I am very sorry I even brought up the topic of my financial situation as it created a debate I did not want. I do not want to be facetious but the amount of money I will have saved up I do not consider a lot of money. I certainly do not feel I have not enough to justify use all these financial advisors. I do my own research/financial planning and I am far from being an expert so I often research online and ask for advice in forums like this on all sorts of topics.
  3. Since it got brought up, the fact is I do plan to have an asset base outside my IRA that I will mostly use up before 60 with a good margin of error.
  4. This entire FA stuff was really just a red herring. Again, sorry if it diverted attention away from what I really want to talk about. Of course I do plan to take advantage of it if I can but it is not critical to my plans. I am very sorry if I used language that provoked and offended people on this board. I insist on my right to do it but if I came off as bragging about it I am very sorry if this hurt anyone’s sensitivities.
  5. I really do not want to answer more questions about my personal finances and the nature of my work and my IRA. I hope the people the board can understand my motivations behind that.</p>
67

<p>Ok…I’ll bite. If you feel your projections about increased future college costs are accurate, then now is the time to significantly add to that college fund for your son. It is an investment in his future, and yours.</p>

<p>As a point of reference…40 years ago when I was in college, the Ivies were about $5000 a year…maybe a tad more. Now they are over $50,000…ten times the cost of the 70’s. </p>

<p>In my opinion, something will need to drastically change with regard to college costs, college funding, loans, and the like within the next generation.</p>

68

<p>My two cents: If you can game the system, be my guest. If there is a loophole to exploit, go for it. Everyone wants to get the most for the least. Just don’t come here crying later on when the game didn’t work out as you had planned.</p>

69

<p>By the time OP’s offspring will start college, we’ll have gone through at least three administrations, maybe more. The college tuition / FA landscape likely will have gone through massive changes by 2028. And while it’s fun to speculate as to what those changes are going to be, it’s ridiculous to try and specifically plan for something that far out now.</p>

<p>But…while the OP’s foresight for providing for his child is commendable, his bold plans to ‘game the system’ are, to be frank, revolting. It’s one thing to plan financially for your child and put yourself in the best light tax-wise, legally. Nothing in the world wrong with that. But if that line is crossed into hiding / moving assets, etc., in order to make PROFILE (or whatever the heck they will have in 2028) look better & garner non-merit-based financial aid, I don’t like that one bit. I’ve railed on these boards about these scammers before & have indirectly witnessed instances of this sort when my D’s were going through the application process 5-10 years ago. They should be caught, charged with interstate fraud, and locked up.</p>

<p>Maybe by the time 15 years has passed, colleges will be somewhat more diligent in vetting potential financial aid receivers than they are now.</p>

70

<p>The OP could put his child in the foster care system at the right time. If timed correctly, this would make the student independent for financial aid purposes. OR he could place the child in a legal guardianship with someone other than he/wife. Again timed correctly, this would make the kiddo independent.</p>

<p>NOW the catch is…this independent college applicant won’t be able to have assets or receive any significant income…or be the beneficiary of a trust (value would need to be reported).</p>

<p>But he would qualify for a Pell grant…woohoo.</p>

71

<p>Truly, the safest bet for long term estimates of college costs would be to use the historical rate of increase which is roughly 5 to 7 percent per year. Run those numbers. Plan to have that much set aside by the time junior hits college age, and revise your plans every couple of years as you see fit.</p>

<p>That is basically the advice I was given back when Happykid was in elementary school. I was not in a position to save anything at that time, so I just didn’t. You however are in a position to do so, I recommend that you make that effort to save deliberately for college.</p>

<p>As the parent of an only child, I also recommend that you think twice before funding a 529 for junior. Should he choose a career that does not require a Yale-price institution (or even a college education at all), you can end up with a lot of money tied up in accounts that only can be used for college. Happykid’s career field does not strictly require a college degree (although she has opted for the college route). When we were able to begin saving for college, that money went into very boring laddered CDs so that it could be used to help support her career goals whether she chose college or not.</p>