<p>Smallab, give your mother a hug and lots of credit for having that hard talk. This financial situation is a really big problem for many of us who planned for college and had money in the market for it. If your mother had $100K put away for college for you, that meant that she would have at least $25K a year to pay for your school out of savings. She might have had other savings that she had earmarked for other things as well. When those funds all diminished, it’s a big problem, especially if the emergency fund is one that is low as well, since that is not one that is an extra but a necessity. Throw in some other unexpected events, and some job uncertainties and you have a problem. </p>
<p>We have a house that we intended to sell this past year. The market is dead here. Our HELOC has been reduced. We had some crises. That has reduced our flexibility enormously. I would love to sell our house, and move into something smaller, less expensive and in not such a great school district. Can’t do it without incurring a huge loss, which we may well end up doing anyways if things continue going downhill. </p>
<p>You see, when you make $X, your standard of living tends to be scaled to that amount. It seems like your mother did save and have a cushion, but that is no longer there. Nor is money intended for your college. A lot of things we acquire cannot easily be disposed of, like a house and the attendant costs of homeownership.</p>