Growing up, I never knew how much money I had in my college fund. But when relatives gave me money for birthdays/holidays/etc., it was to go in my education fund. I also get money from Social Security and I assumed my grandmother was putting money in as well. Also, when my grandfather died, in his obituary, it was written for people to donate money to that fund in lieu of flowers. Now that I’m going off to college, I asked to have the money and my grandmom said no and that it wasn’t mine. I said it is and she said, “The only reason I have it as an education fund is so I wouldn’t have to pay taxes on it.” I said is there $5,000 in it? And she said yes. I said is there $10,000? And she said she wouldn’t tell me because it’s not mine. I asked her what she spent it on and she said on raising me and my brother. She does live frugally (buying everything on sale, coupon clipping, etc.) in a lot of ways and I know it’s not like she goes out and spends it on leisure or anything. But she does make what are in my opinion foolish financial decisions. Like the year after my grandfather died, she bought a $35,000 SUV. She says it’s paid off. This is an older woman whose only income at the time was cleaning houses. When I got into a car accident, she put $5,000 on her credit card as opposed to using the insurance because she said it would increase the rate too much, even though I’m being taken off the insurance once I go away to school because I won’t be driving so any rate increase would be temporary and any deductible would have been far less than $5k. She’ll buy things that I say I don’t want/need. If things need mending, she just throws them out and buys it new. I told her I don’t need my own printer for college, that the libraries and my dorm floor have one. But she insists that I do, that it’s easier, and bang another $100, more when you factor in the ink. She also bought me a $100 desk stand/shelf that I said I didn’t need.
On one hand, I feel deceived. Our relationship is already bad so now I’m really pissed. But at the same time, I have no idea how much money was in there in the first place so I don’t know how mad I should be. Someone said I should “fight” for the money but I think that’s kinda shitty if she was using it for things I/we needed. I wouldn’t do that and I’d have no idea where to start. I don’t even know what bank it’s in. What are ethics of something like this? I never expected much money, it’s not even the money really. I’m mostly upset because she said it was for one thing to me, our family, friends, and it was really for something else.
Well that stinks! Is your grandmother is your legal guardian? Knowing your family situation would help.
“The only reason I have it as an education fund is so I wouldn’t have to pay taxes on it.”
You should consult with someone knowledgeable about the subject (a CPA or financial advisor?) but it really was set up as a tax deferred education account, with you as the beneficiary, then using the money for anything other than your educational expenses is fraudulent. You are certainly within your rights to ask for an accounting of where the money is, and if you can’t get a straight answer you should mention it to family members that donated to the fund.
If it was in an education fund (529) she’d be restricted as to what it can be used for tax free. If it is just an account labeled as an education fund (a savings account at the bank labeled ‘Mary’s college fund’) she can use it for anything she wants, but it is not tax protected
Do you have a right to this money? Unlikely. If she was getting SS money to raise you and she spent it, that’s what it was there for.
I support the idea of talking about this with a family member whom you respect and whom your grandmother trusts. They may have more success in getting information from her and brokering some kind of resolution. But if she is your guardian and is raising you, then she does have the right to spend that money as she deems best (unless its in a 529 account which can only be used for college and she taking a significant risk using it any other way). It wasn’t fair to represent to you that it was being saved for college if it’s not - but if money is tight, I can understand her using it to purchase things she thinks you need even if you (and we) don’t agree that it’s a good use of money. She also has the right to buy herself an expensive car or pay for your healthcare needs without drawing on her insurance even if those doesn’t look like good choices to you. She is the one in the drivers seat, so to speak, until you are legally of age.
The good news is that once you are legally an adult, she will not be making future financial decision for you. Once again, the advice of a trusted family member on how to finance your future education - with or without a college fund - can help. Likewise, talk to a teacher or guidance counselor with whom you have a good relationship.
I know you are feeling particularly upset with her these days, but if you can give yourself the gift of perspective, just remember that she took on the huge responsibility of raising her grandchildren, while working to clean houses, clipping coupons to make ends mett, and has lost her spouse (and her children?). That sounds like a hard life. Only her love for you and loyalty to family would explain the sacrifices that she has made for you. So give her a pass if she is less than an ideal parent.
One clarification: Social Security payments on your behalf were intended to be used for your support and upkeep, and she was under no moral or legal obligation to save them for you for college.
If your grandma was getting SS for you and your brother, then likely she was getting about $1000 a month for the two of you. That was to be used to “support you”…not to be saved for college.
However, any money gifts that you were given over the years and put into that account are yours. Where is THAT money?
When you filed FAFSA for college, didn’t you qualify as Independent? What aid did you get?
Op was adopted by grandmother. My grandmother lives on Social Security, perhaps a combination of survivors benefits, SSI/SSD and any monies that G-ma may be receiving for OP and sibling.
Op was accepted at Temple, wants to live off campus. G-ma doesn’t have the money but she won’t let Op live off-campus.
I don’t think that there is a formal 529 education fund but rather informally, relative gives small nominal amounts of money to Op at birthdays/holidays and G-ma says that they are going to save it for college. I am willing to bet especially since family is low income, that somewhere along the line, money has been spent also providing for child (has there ever been a vacation, new electronics, senior dues, prom trips, etc).
If you had a car accident and your G-ma paid $5000 to have the car fixed, that is a good chunk of money paid that had to come from somewhere. It could be that you were not listed on the insurance and it would not have been covered, so she had to pay. In addition, if she has a new car, she would also have to carry full coverage, which would make it really expensive to carry a teenage driver on this coverage (although you should be on the insurance if you are driving the car)
I don’t think that you really have anything to fight over as if she is receiving SS benefits for her self, you and your siblings; are you eating every day? do you have a roof over your head? do you have clothes on your back? it seems as if G-ma is providing you with everything you need (and even a few things that you feel you do not need) in addition to a few things that you want. The real crux of your argument is that your G-ma cannot afford to pay for off-campus housing at Temple and you feel that the monies that she spent on other things could have paid for this.
I think you are being totally unrealistic. Grandmother may not have been perfect with the birthday money (non-SS because that doesn’t count) BUT no one is. Anyone who thinks they can better manage someone else’s budget/money is probably unaware of their own blind spots. Maybe grandma shouldn’t have bought an expensive car but she is older and needs reliable transport PLUS, and more likely IMHO, she was grieving. People make dumb financial moves after death and divorce. People have these same beefs with their bio lparents…my mom drives too nice of a car and won’t let me blah blah blah.
I’m very sympathetic, but do not think the OP deserves the money or will get any money. I’m sympathetic because the OP deserves the truth, that she thought there was a ‘college fund’ but yet there isn’t. I’m sympathetic that the grandmother/mother doesn’t understand all the accounts, college costs, how to manage the money to best help everyone.
OP, you need to realize there is no money coming from a college account and you need to make your financial plans with this information in mind. On another thread you had plans to earn some of the needed money and borrow the rest. That’s your reality. You need to work a LOT this summer and save every penny, moved to school in the fall and just continue to work hard.
OP- I am very sympathetic but I want to float a thought past you- raising kids is expensive. When your grandfather died and the notion was that contributions would go to your college fund, your grandmother likely couldn’t anticipate what expenses were ahead.
Have you ever been to a dentist? Do you wear glasses? Did you take driver’s ed lessons?
These are the kinds of expenses that social security is nowhere near enough to cover.
I think your path forward is to be grateful that you’ve been raised by someone who obviously loves you, probably isn’t the most financially savvy person on the planet, but compensates for her financial lapses by trying to get you launched into adulthood the best way she can.
I think her wanting you to have a printer is evidence of her values. Is that the best use of the money? Maybe, maybe not. But when you’ve got a paper due by midnight some random Thursday and you’ve just emailed a copy to your professor and need to get a physical time stamp on the printed paper and it’s 11:50 pm and you’re racing across campus to deliver it, you’ll be grateful you don’t have to make a pit-stop at a university owned printer first.
I’m sure there were ways your grandmother could have economized further while raising you- but she likely chose to go without for herself before sacrificing your needs.
Good luck to you next year. You seem like a very kind and resilient young adult!
I would go back to the wisest and most thoughtful of those relatives who gave you birthday money and talk it over with them. I would not accuse or get upset, just talk to to them. That is key. You need to realize that your grandmother took care of you and did the best she could with the education and and talents she had.
Your relative will likely know whether there really is a fund or not and if so, whether it was a true Education IRA or 529. There are rules about how money in those funds can be spent. Maybe your relative can explain that to Grandma so she doesn’t get in trouble with the IRS, something no one wants to have happen.
The title of the thread is ‘grandmother spent my college fund.’ The OP has had other posts that the grandmother is unwilling to give her the money, to tell her if there is any money. The OP filed the FAFSA and if there was a fund, it should have been reported.
I’m just a realist. My own father always promised money, and there was never any money when I needed it. There is no money. If there is, it is not in OP’s name so she won’t be getting it.
Yup, My Mother always made similar promises. The money was spent. The only thing for OP to do now is accept the fact that her Grandmother does not have money to give her and figure out if and how she can get by without the promised money. There is no sense in wasting effort, imo, trying to figure out where it went.
My father gave some money to be used for a college fund for some kids. After a couple of years he asked how the money was invested and the father said that they had used it to pay off the family’s mortgage since that seemed to be the best rate of return for the kids, and they would just give the kids the money when the went to college. My dad fumed when he got back in the car. “That’s illegal as hell.”
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My father gave some money to be used for a college fund for some kids. After a couple of years he asked how the money was invested and the father said that they had used it to pay off the family’s mortgage since that seemed to be the best rate of return for the kids, and they would just give the kids the money when the went to college. My dad fumed when he got back in the car. “That’s illegal as hell.”
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It may be unethical, but I’m not sure if it’s illegal. Your dad should have put the money into some kind of protected acct…maybe a 529 where he was the asset holder.
The other dad answered honestly. He could have just lied and said, “I put it in mutual funds” or something.
I hope the other dad follows thru. Without a mortgage, he should be able to pay. However, since the dad didn’t say something like, “well, since I haven’t had a mortgage for a few years now, I am saving the money that I would have spent on THAT into a college fund.” Sounds like this happened awhile ago? If so, what happened?
It does seem rather random that your dad gave some family money for their kids’ college.