At what point can a parent actually afford to pay for their child’s college?
How much should a parent reasonably be able to save for their child’s college depending on their income.
50k-
100k-
150k-
200k-
250k-
My parents are fairly wealthy(do not want to disclose income) and they are willing to pay for tuition and room and board to any instate school or a school I can get into that is cost equivalent to a Texas university. Being a senior, I do not fully understand the lengths an income will go.
Just to say, I am extremely grateful for my parents being able to pay for in state schools. I am just wondering how much they could actually afford.
Answer depends on a number of factors. Actual income. How long have they had that level of income. How stable is it. Other expenses (such as other siblings (in college now or in the future), caring for parents, etc). How old are parents in terms of retirement and how much have they saved. What is cost of living where you live.
Well I guess I don’t care to disclose family numbers to strangers haha.
My parents work both off commission. Since I was born 18 years ago combined they probably made 200kish and this last year they made 500k. Past 10 years they’ve made 300k+. 1 sibling who they are prepared to pay for in state as well, but she is 20 now and has not shown much interest in college. We live in Dallas, TX suburbs and cost of living is TX is low comparatively. No health problems, they are 50 and 51, retiring at 60. He does invest his money into his retirement fund, rental properties and we just recently purchased a vacation home in Mexico.
With all that said, I have the scores and resume to get into schools like UCLA, rice, and other schools (not ivy, but the schools a tier lower). I did the math at to go to UT Austin after my first year tuition free (valedictorian scholarship) They would be paying about 87k. Is that the most at that income they could afford?
He didn’t say instate is the most he could afford, he phrased it that was the most he would pay. I’m just wondering if he could actually afford to send me to a private university or something like UCLA.
There are. LOT of factors beside income that play into a family ability to pay for college.
Home mortgage debt.
College debt they might have of their own.
General consumer debt...credit cards, cars, etc.
Cost of living in your particular area. Some areas on TX are pretty pricey.
Number of other siblings to put through college.
Some families would prefer to maintain some savings to helpmtheirmkids with OTHER costs beside college costs…maybe a wedding, or down payment on a house, or a car…or,something like a vacation.
If your parents earned $300,000 or so in 2015, you knownyounwont qualify for need based aid…anywhere. If your parents have set a budget that the cost of a Texas public university…that is your budget (you are so lucky…some kids would be so thrilled to have an undergrad education with NO loans, fully funded by their parents). Texas has some great public universities.
Now…regarding other schools. You could apply to some schools where you would garner merit aid. If you can get full tuition someplace, your parent cost would be within your price point.
Your parents have either saved the money or not. Many families also pay for college with current earnings, so if your parents have saved $50k, but they are also willing to pay $15k per year out of current earnings, your choices may go up. I think you should figure on about $25k per year as that’s what your Texas costs would be and what they have said they are willing to fund.
I had that same target with my kids, the cost of instate tuition. Neither goes to an instate college in the state we were living in at the time, but both had to deal with that as a budget and it worked. One has a COA of $55k, but in order to make that school work, she had to get a merit scholarship and some other funding while working with what I said I could pay.
If your parents are telling you that the max they are willing to pay is in-state tuition, R&B or equivalent, then that’s the max they’re willing to pay. Frankly, that’s more than fair. Texas has some great in-state options.
If you think you want to go to a school outside of that budget, it is your responsibility to make up the difference in loans, possibly applying to be an RA to save money, etc. It is pretty ridiculous to try and calculate what your parents can “actually” pay, as they’ve already given you a budget. While I believe parents should help their child pay for college, they should by no means have to overpay because you think you’re better than a state school. It’s still their money, and you’re not entitled to it.
Consider applying to private schools where you’re competitive for merit aid if you’d really like to leave Texas, but applying to a pricey reach because you think your parents SHOULD pay more is pretty silly.
Sounds to me like your Dad is a very reasonable and self-made man.
He might have the money, but he does not really see the value in paying $60,000 a year for a college education that reasonably be had at UT.
You are SO fantastically lucky that he has saved up enough money to send you there and you will graduate debt free so you can go make your way and do the same as him.
It must be frustrating to see your parents spending money on a vacation home and rental properties while not being willing to pay for you to go to an expensive private or OOS college. The fact that your father is willing to pay full cost for an excellent in-state school indicates to me that he is looking at the return on investment for your education and concluding that you will do just as well in life with the in-state choices you have.
If you really want to go to Rice or UCLA, you could try to present data to your father showing why these are better investments. (You may conclude, after doing a bit of research, that they really aren’t better values, so keep an open mind.)
There is absolutely no way to answer this. My spouse and I make ballpark 40-50k/year and we have a 3 bedroom house and are comfortably paying off student loans and high medical expenses.
That same income would barely get someone a 2 bedroom apartment in another part of the country.
Thanks for the replies. I did not make this trying to sound like a brat “My daddy wont pay 60k a year i hate my life”. It was more of a financial question. I am merely interested in how much one needs to make to pay the full price of a private school without financial need. I am very appreciative of my father and now understand there are too many factors to ever say if someone can truly afford something no matter their income.
The instate tuition equivalent average was the budget we gave our daughter as well. Could we “afford” more, maybe, but this amount, $25,000 to $30,000 per year was what we felt we could handle. If she wanted a more expensive option it was up to her to make up the difference with scholarships and/or minimal loans. She ended up with an excellent scholarship at a private school and we are paying much below the amount we budgeted per year and she won’t need any loans.
Be grateful that your parents are offering to GIVE you $100,000+ for your education regardless of their income. That is a chunk of money.
We were full pay for our kids on less money. And did so happily. But we started saving the day each kid was born; we bought a house which was much cheaper than what the mortgage calculators said we could afford, and we drove cars for 10+ years. (again, happily). Allowing our kids to pick their colleges without regard to cost was just something we wanted to be able to do as a family.
So it’s not just about the money. It’s also about everything else.
Sounds like you need a sit-down with your parents. Yes- from you posted here, they can afford to be full freight at Rice. But if they don’t want to spend the money, that’s their prerogative. And there may be part of the financial picture you don’t know about. Grandparent in assisted living? That could be 30K per year. An Aunt who is on disability so they pay her mortgage?
These are things folks don’t discuss with their kids but might be commitments they’ve made which supersede college.
Not being sarcastic but maybe not artfully stated. I was trying to acknowledge that I could understand why the OP was asking the question. Definitely not meant to be judgmental at all but I it really does read that way, doesn’t it.