This is not real life - paying for college edition

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I've been living inside the DCUM bubble for a long time. My first kid is going to college this fall, and I've joined a few college Facebook groups. I am absolutely gobsmacked by the lack of financial resources and acumen among most people in this country. Many parents seem to be surprised that they can't afford the college their kid got into, or are strategizing about how to take out loans for the entire 4 years.

I recognize that most of us here are privileged in one way or another. Either we are high earners, we've diligently saved for school, or we understand that you shouldn't go somewhere that you can't afford. It's insanity out there.

Not everyone is well informed about college costs. Families of immigrants and first Gen college attendees aren’t familiar with the system. Also colleges usually advertise costs with average aid factored in, not everyone gets full or even enough aid.

What’s crazy is college costs, specially top ranking colleges. Colleges can keep it high for international and non citizens but they should lower costs for citizens to a more affordable level. College cost is nothing for rich, poor make it with aid but for upper middle class family not gaming finances, this is insane amount of money to pay. Their only option is to go to much lower ranking colleges offering merit money.

you only have to go outside the top 25-30 to find schools with great merit offers. That's not actually "much lower ranked ". Plenty of excellent schools that can be affordable

My kid is going to a school in the 40’s for a 1/3 merit tuition discount. Still expensive though.

[Anonymous]

We started funding my daughters' 529s as soon as they were born. We started with $2500 each annually in my account. As our incomes grew we added $2500 each annually in my wife's account. It felt hard originally to put away $420/mo. It got easier and we went to $840/mo. Oldest DD will finish with money for grad school available, or an IRA rollover with some additional left over.

My younger DD is well on her way to a little more when she reaches college age.

Compounding works wonders.

[Anonymous]

Anonymous wrote:We started funding my daughters' 529s as soon as they were born. We started with $2500 each annually in my account. As our incomes grew we added $2500 each annually in my wife's account. It felt hard originally to put away $420/mo. It got easier and we went to $840/mo. Oldest DD will finish with money for grad school available, or an IRA rollover with some additional left over.

My younger DD is well on her way to a little more when she reaches college age.

Compounding works wonders.

In other words, you’re a perfect example of the “diligent saver,” common on DCUM, but whom OP was surprised to discover is actually atypical of American parents of college-bound students.

[Anonymous]

Anonymous wrote:We started funding my daughters' 529s as soon as they were born. We started with $2500 each annually in my account. As our incomes grew we added $2500 each annually in my wife's account. It felt hard originally to put away $420/mo. It got easier and we went to $840/mo. Oldest DD will finish with money for grad school available, or an IRA rollover with some additional left over.

My younger DD is well on her way to a little more when she reaches college age.

Compounding works wonders.

How much did you wind up with? Is it too much? We put away about $2500/year for each kid and now have enough to pay for UMD today...for our 11 year old. I know prices will continue to increase, but also don't really see the benefit of sending my kids to expensive privates without aid (we're in that $150-200k HHI range but it sounds like that can be donut hole). I actually do wonder if the PP's advisor who said to cap it at $200k was giving good advice.

[Anonymous]

Most people don’t have enough to pay for a $1000 emergency. Do you think they have enough to save for college for 18 years? I was only able to start saving in the few years before my son went to college. Before that I just had enough to pay basic bills like rent, utilities, healthcare, transportation, insurance, etc.