Absolutely! We relocated to the US in 99. Around that time, I searched how much our local state university would cost. I concluded it was very high, but still affordable with our income. What I didn’t anticipate is that the costs would balloon out of control. We also moved to a different state with higher costs. We would have saved around $20,000 per kid had we stayed there. We still managed to put one kid through and expect to do the same with the second one, but the cost is simply nuts.
Started saving for each kid right after they were born in 529 plans. Now after about 18 years due to market conditions, they have grown considerably.
@Waiting2exhale is correct:
@ashi23, I am going to make the assumption that your child has already been accepted to a school, but did not receive a significant amount of merit or need dollars from the school? Now, you are trying to figure out how to pay for an expensive school, because you did not have a savings plan accruing college expenses, correct?
You have two options:
1.) Take our huge, hefty loans, through Parent Plus, on YOUR credit, and assume that your child will NOT be able to repay the $250K + for 4 years of his/her education.
2.)Have your child take a gap year and reapply to affordable schools next year.
Please tell your child, a degree is a degree and, paying for prestige is no guarantee of future employment or significant income. No one is going to care that the degree is from a state-funded school. Your child also needs to find a job to help pay for his/her expenses.
“The OP asked their question and hasn’t been heard from since.”
Or it’s a drive-by flame just to get people to answer and debate at length. The lack of grammar is a good clue, but if the poster returns, I’ll stand corrected.
One thing that sounds counter-intuitive but really did help us afford college was the fact that we’d been paying private school tuition for years. We weren’t able to save very aggressively, but we had big old tuition-shaped holes ripped in our household budget already and didn’t have to change much to afford a basic state school. On the other hand we really didn’t have a lot of room to move when a more expensive school came up, so with four kids we were pretty clear about budgets at the start of the process. One went to a more expensive LAC, but she got the merit and it fit for us.
But back to the earlier ideas, this is a big change that happened years ago. Suddenly finding $15k or $30k or more is not feasible for most people.
@StPaulDad , it makes perfect sense. When you are pay $x i tuition and fees every year, you don’t spend that amount on a larger house, vacation, a pricier car or on whatever consumer goods. Yes, in theory ( and for some good people, in practice) that amount that you are paying for private k-12 school should be going into savings, college fund, the market, etc, for those in similar income bracket, but most often it does not. So when the time come for the high schooler you go to college, the private school family already has that $x earmarked for education.
Still, , too often the FAFSA AND PROFILE expected contributions come out hard to swallow for many families, especially at the private schools.
We have saved $600 a month in a 529 since birth and still don’t have enough to send two kids to the state public university. I think it’s deeply misleading to readers to suggest that you can save $25 a month and take only camping vacations and belt tighten a little and you’ll end up having enough to pay for college nowadays. I just put some numbers into a savings calculator, and we would have had to save about $416 per month per kid for 18 years to afford our in-state public universities, and that’s without assuming tuition will go up, which of course it will. Double that (or more) for private schools. That’s a pretty big chunk of change for a young parent who is also probably paying about $1500 a month per kid for daycare, and is in the earlier days of their career. Most full-pay parents cannot afford the prices of public OR private colleges currently–even if they were frugal all along. Run the numbers.
@ccprofandmomof2, $416/month adds up to about $5K a year X 18 = $90K. And that’s with no market appreciation in the 529. Granted, yes, tuition and R&B have also risen fast.
So it depends on what state you’re in and how cheap/expensive the publics are. Also if you commute or not or bring in credits through AP/DE/CC/early college.
At most publics, R&B is the bigger expense, but that is controllable. In tuition-free Germany, nobody is paying for your R&B except yourself/family. Getting paid to attend uni (which those who get more fin aid than tuition costs essentially are) would be unheard of there. I don’t think anyone can say with a straight face that university in Germany is too expensive (considering that they’re tuition-free). But yes, the luxury good of 4 years of live-away college without having to work to earn anything to pay for that is pretty pricey.
Right, and our publics cost about $36K a year, all in. That’s $144 for four years, but many kids can’t graduate in four years because the classes are overenrolled. Look, I’m not going to quibble about the details, and certainly many state publics are cheaper, but you HAVE to admit that the advice to save $25 a month and go camping is seriously out of date. I think that if we are going to offer advice on these forums, we have to be at least in the ballpark of reality.
REALITY: @ccprofandmomof2 -you don’t know me and you are basically calling me out:
Whether or not you think we are misleading readers or believe it, we ** put our three kids through college with those savings and carefully planned budgets**.
Every extra dollar, saved on our own car, plumbing, house repairs, lunches from home went into those 529s. We didn’t live outside of our means. We paid for everything in cash except our mortgage-used cars, dinged washers/dryers. We refinanced our mortgage and were able to pay it off 10 years earlier than anticipated. We didn’t live in the best neighborhood and I shopped the secondhand store for our business attire. Dry cleaning, nope. I drove a 17 year-old Camry until it died, and have a $32 Timex watch. Apple phones-nope, embarrassing flip phones for the kids. No cable tv channels, but library books, puzzles, and game boards.
One huge difference is that my husband and I have had good paying jobs, so every extra dollar went into the kids accounts. (I could have finished my dissertation but being a professor wasn’t the right high-paying choice for me).
Plus, our kids did exceptionally well with grades and merit and earned scholarships. They worked every summer in high school and college to earn their spending cash.
It can be done if you don’t care about having the latest and greatest. FWIW, we are paying for our daughter’s in state professional/med school program now-cash upfront. She wont owe a dime when she’s done.
@Aunt Bea: “Every extra dollar, saved on our own car, plumbing, house repairs, lunches from home went into those 529s. We didn’t live outside of our means. We paid for everything in cash except our mortgage-used cars, dinged washers/dryers. We refinanced our mortgage and were able to pay it off 10 years earlier than anticipated. We didn’t live in the best neighborhood and I shopped the secondhand store for our business attire. Dry cleaning, nope. I drove a 17 year-old Camry until it died, and have a $32 Timex watch. Apple phones-nope, embarrassing flip phones for the kids. No cable tv channels, but library books, puzzles, and game boards.”
Hello there, @aunt bea. Have we shared this moment before? In many ways you and I are, as the young people say, “twinning” right now. And I am totally jealous of your 22 year stretch with that Camry, though I know the truth of it (21 years here).
Agreed. Your numbers echo our situation. We have been saving $500 per month each kid since birth and by the time D19 goes to college last year, it’s not enough for 4 years of her OOS tuition. I think it was around $220k but we needed more like $260-280k. So we started to double the contribution to her fund since last year. Unless stock market tanks, she should have enough for 4 years. My son’s account looks a little better and he won’t start college until 2023. It’s funny that he keeps offering his 529 to pay for his sister.
Can we all agree that saving $25/month/kid in a 529 isn’t enough to fully fund a 4 year live-away college experience, much less a 4 year OOS live-away experience?
$25/month/kid + merit money isn’t the same as only $25/month/kid.
No, we cannot all agree with that. For one thing, @“aunt bea” is not talking about saving today to send a child to college in 18 years. She’s mostly talking about children who have already attended college. Maybe $25/month 20 years ago is $60/month today.
Second, her message rings very true to me. I drive a 2004 Honda Odyssey. I also drive a 2002 vehicle and a 2008 vehicle. I do not have an expensive cell phone. For a long time, we rarely took vacations because we did not think it was the best way to spend our money. I don’t condemn anyone who has newer cars or better phones or who takes great vacations, but I shake my inner head in pity when people who do spend money on those things complain that they don’t have enough money so send their children to college. Cause and effect.
@“aunt bea” made serious sacrifices to ensure she could send her children to college. I applaud that. Why would anyone think negatively of that?
@EconPop, who is thinking negatively of that? But the point remains that those sacrifices, without merit money, would not have been enough.
Are you seriously trying to suggest that saving $60/month for 18 years is enough to pay for 4 years of live-away college? That’s $720/year. About $13K over 18 years.
I think you’re aware of what total cost of live-away college is now.
I think there is a disconnect. For some families, saving $60/month is a stretch – it is the most they can do. Will $60/month on its own pay for Loyola Marymount? Absolutely not.
However, say a family starts with an initial deposit of $500 and then saves $60/month for 18 years. At college move-in day, that family will have about $14000. For a Pell Grant family, that is the difference between affording college and not affording college. A Pell family will have to pay about $2000-$4000/yr out of pocket for their child to attend college at a public in-state option. A little more in some states. That 529 savings account will allow that child to attend college.
Now, if we’re not talking about a Pell eligible family, they should definitely be able to scrape together more than $60/month. A family higher on the SES ladder should be saving a lot more. Maybe $200/month to $500/month. But they should also be able to afford to save that much.
Yes, it will be a sacrifice for almost every family. Instead of driving that automobile that costs $400/month, drive an old vehicle and save for the child’s education. Or, if the parent prefers to drive a new car, buy the new car. And take the cruise. And buy the new $1000 iphone. Live in a neighborhood that requires a mortgage premium of $600/month. That’s all fine in my opinion.
But it is possible for most families, whatever their income, to save for college if they choose. Pell Grants, GS Loans, and need-based aid result in sliding expense scales and while $60/month may not help a $150K/yr family, it will certain help a $60K/yr family. If the family earns more, they should be expected to save more.
Speaking personally, I was not able to save at all for my children’s education. However, I did save. I used my savings to invest in a business. Though I have a business, my AGI allows me to qualify for the PG and allows me the freedom of lifestyle to homeschool one of my children and be very involved in the college search process for my oldest child. It does not afford me to also buy a new car, an expensive house, or an iphone. I could have those things if I chose, but my children would suffer for them. @“aunt bea” sacrificed such things for the benefit of her children. I think that was fantastic!
OP hasn’t retuned. Closing.