“Fully Funded College”
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Anonymous
Still haven't heard a good defense for giving one kid more $$ than another. And while I agree sweating the details down to the last penny is silly, the PP you're referencing offered the example of providing one kid $85k and another $100k. That's not slightly more, imo. It would be trivially simple to just give both kids $92.5k. |
Anonymous
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Kid at TJ and kid at a strong FCPS HS. 2 years apart. We consider them fully funded when we had a paid off prepaid VA 529, plus at least a year of room and board saved for each kid. Which will be their senior years. Then, we will have 6 years of being on the hook for one year of room and board, which is very doable on our income. We can make up a little bit of a gap for each kid. But not a lot.
Fully funding 4 years of any private you want is not realistic. I’m also not sure I see the value without merit aid, especially if kids are looking at grad school. But, there are good merit aid options in private schools for each kids interests and Stats. The younger DC’s 529 will be worth a little more than the DC’s, because inflation. But they are both going to have to operate under the same guidelines in paying for college. We can pay WM, plus somewhere in the neighborhood of $5,000 a year. I would not be okay telling one kid they have to make public work and paying private for another unless they was a significant overriding factor, like a disability or LD that necessitates private school for one kid. If one or both of my Dc’s does not use all of their 529, then I would not give it to the other sibling. It is still their money, that we have have saved to launch them. They can use it for grad schoool. Or, I can transfer it to pay educational expenses for their sibling, and put the money I would have spent on their room and board in a CD to use as a down payment on a house or otherwise get a start in life. But, if you do the work to get a full merit ride, I think you should have the financial cushion. Neither of our kids have special circumstances that would warrant treating them differently. So, in my mind, it is important that they are on the same footing ask they start their adult lives. But I don’t judge families who are making different decisions. It is a tough college acceptance environment, and college costs are out of control. I trust parents to do what they think is best for their kids and their families. If they are like me, they feel guilty they didn’t find a way to save $250,000 a kid instead of $100,000. There is no reason to pile on. |
Anonymous
This. The money in my kids VA 529 is in my name, right of survivorship, DH. It is on behalf of my kids. But, I could transfer it to another family member if I chose (which I would not). Nothing in a 529 vests in the kids and they have no control over the money. So it is not a gift. |
Anonymous
Yes. But resident of a state and resident of a state for college tuition are determined differently. |
Anonymous
529 contributions in excess of $14K/year are absolutely subject to gift taxes, even though you continue to own the money, although you can lump up to five years of gifts into one year without paying the tax. |
Anonymous
But what happens when the first kid was already given $100k, the market goes down soon afterwards, and when DC#2 starts college their account only has $15k? Not everyone has the extra cash in their back pocket. |
Anonymous
| ^^^ sorry I meant $85k, not 15k |
Anonymous
And that's per parent (or grandparent), so you can easily multiply those figures x2, x4, x6. |
Anonymous
It's true that a severe market crash could make it tough, but a couple things. #1 you shouldn't be so heavily invested in risky assets within a year or 2 of college anyway. #2 if that happened to me, I'd find a way to true up kid #2. I'm not gonna just shrug and ask my kid to absorb the market risk. Even if I don't have it in my back pocket, I'd true up kid #2 over time. |
Anonymous
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Fully funded for us means -
- pre-paid tuition for 2 kids, in-state for 5 years. + - room and board for 2 kids, in-state for 5 years + - tuition saved for 4 years of med/law/mba for each student + - room and board for 4 years of med/law/mba school for each student + We are hoping that they go to in-state med schools too, but if they don't then then don't. |
Anonymous
What if they don’t want to be a lawyer/doctor? |
Anonymous
Which would be around half a million per kid? |
Anonymous
Not true according to my tax accountant. We put about $50k in each kid’s account last year and had to file paperwork with the IRS to apply to their exclusion. |
Anonymous
But the original premise was several kids, maybe three - going to college 4-8 years apart. So your "risky assets" attack doesn't fly. And you're gonna find a way to "true up" kid #2? Well what about kid #3? Where's this magic money coming from? Are you pulling from your 401k, or taking equity out of the house to make sure these kids get exactly the same amount? And if you're that anal about it, are you accounting for inflation for kids spaced 8 years apart? |
Anonymous
| Fully funded college in this day and age means $340-400k cash. |