College fund - yes or no?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:They're probably expecting to have their kids' college paid for by other means, either rich grandparents that they don't bring up in conversation with you or magical thinking about scholarships. You are not wrong for saving for college, but you already know that, you just want a pat on the back for being a better parent than every single person in your circle of friends.

::pat, pat::

I don't know what OP would have to gain, emotionally speaking, from soliciting a "pat on the back" from random d-bags such as yourself.

NP and I agree OP is looking for commendation. Her words:
I realized after discussing with our circle of friends that not a single one of them has put away money for their kids' college funds. They decided to put their money elsewhere - mostly into their house, but also more comfortable spending money on things like lessons and activities and camps for their kids, and on family vacations and entertainment.

We are on track to saving enough to fund their entire college education. We would not qualify for need-based financial assistance. College is dizzyingly expensive.

And then the non-question she ends with, which she already knows the answer to: Are we making a mistake by putting money into their college funds?


Do you really think her friends are saying they decided to put their money into other things? No- she sees her friends spend on other things and then judges them. OP is looking for a “great job, you!”

NP. I agree too. I’m also skeptical of OPs story. OP is trolling or looking for backpats.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I am sure your friends are not Asian-Americans. Asian-Americans save for their kids future first.

Makes me wonder if that's why there seems to be more Asian-Amercian households that are multigenerational, with the grandparents living with their kids' families in retirement. I get it may also be a cultural choice or preference, but it would also make sense if the parents spent a large chunk of their savings on putting a few kids through college.

Yep, I am from India, in US money flows forward. So parents provide for kids. In India (although it is changing), money flows both forwards and backwards. Plenty of Indians in US send monthly remittance to parents in India. Plenty of adult kids stay with their parents in India to save on rent, groceries etc. Culturally the norm is that son & DIL stays with son's parents. Lots of parents have joint finances with their sons as inheritance is passed to sons (not to daughters - although there is an expectation for bride's parents to foot the wedding bill and gifts).

But again, lot of this is changing, especially for the middle and working class.

[Anonymous]

No you are not making a mistake. Your friends may or may not be. They may have grandparents who will pay or they'll just plan to pull out a home equity loan. Or they are dumb and don't understand how college financial aid works -- that it's driven largely by income not savings. I've heard some people say they aren't putting aside savings for college because they think they'll get more aid that way. That's not how it works.

[Anonymous]

There are a lot of people who will use their home equity to pay for their children's college. Not sure if that's still common but was with families that paid a mortgage for 20 years before kids go off to college.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I realized after discussing with our circle of friends that not a single one of them has put away money for their kids' college funds. They decided to put their money elsewhere - mostly into their house, but also more comfortable spending money on things like lessons and activities and camps for their kids, and on family vacations and entertainment.

We are on track to saving enough to fund their entire college education. We would not qualify for need-based financial assistance. College is dizzyingly expensive. Are we making a mistake by putting money into their college funds?

Unless they make less than 150K, they won't likely won't qualify for any need-based financial assistance either. They will just be scrambling to figure out how to fund $40-50K+ per year once kids are college aged.

You are not making a mistake---if your kids attend a school with merit award, you can withdraw from the 529 to match the award without any penalty (if you don't just want to leave the $$$ in the 529 for grad school, other kids, grandkids, etc). You will not be figuring out how to cash flow $50K+ for 4 years and that will be a good thing

$50k? Top privates run $80k or over NOW. How old are your kids, OP? If you can fully fund your retirement (up to limit with match), by all means keep contributing. Just monitor like any other investment account. Such a gift for your kids. We were like your friends, and made a stupid mistake by not starting 529s earlier.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I realized after discussing with our circle of friends that not a single one of them has put away money for their kids' college funds. They decided to put their money elsewhere - mostly into their house, but also more comfortable spending money on things like lessons and activities and camps for their kids, and on family vacations and entertainment.

We are on track to saving enough to fund their entire college education. We would not qualify for need-based financial assistance. College is dizzyingly expensive. Are we making a mistake by putting money into their college funds?

Unless they make less than 150K, they won't likely won't qualify for any need-based financial assistance either. They will just be scrambling to figure out how to fund $40-50K+ per year once kids are college aged.

You are not making a mistake---if your kids attend a school with merit award, you can withdraw from the 529 to match the award without any penalty (if you don't just want to leave the $$$ in the 529 for grad school, other kids, grandkids, etc). You will not be figuring out how to cash flow $50K+ for 4 years and that will be a good thing

$50k? Top privates run $80k or over NOW. How old are your kids, OP? If you can fully fund your retirement (up to limit with match), by all means keep contributing. Just monitor like any other investment account. Such a gift for your kids. We were like your friends, and made a stupid mistake by not starting 529s earlier.

I was suggesting 50K as a mid point---instate public schools. I know most privates are 80K+ already. Living that with my own kid currently. Thankfully we have a fully funded 529 for them

[Anonymous]

How much should one put in a 529 per month for a child?

[Anonymous]

Lot of parents with younger kids are clueless about college financial aid and merits. The financial aid calculations are complicated and there are lot of misinformation on 529 and scholarships. We figured out too late (10th grade) how expensive it is and that we are not qualified for any financial aids despite modest incomes and there are no merit aids from those schools DC is interested in. We would have put way more in 529 if we knew.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I realized after discussing with our circle of friends that not a single one of them has put away money for their kids' college funds. They decided to put their money elsewhere - mostly into their house, but also more comfortable spending money on things like lessons and activities and camps for their kids, and on family vacations and entertainment.

We are on track to saving enough to fund their entire college education. We would not qualify for need-based financial assistance. College is dizzyingly expensive. Are we making a mistake by putting money into their college funds?

Unless they make less than 150K, they won't likely won't qualify for any need-based financial assistance either. They will just be scrambling to figure out how to fund $40-50K+ per year once kids are college aged.

You are not making a mistake---if your kids attend a school with merit award, you can withdraw from the 529 to match the award without any penalty (if you don't just want to leave the $$$ in the 529 for grad school, other kids, grandkids, etc). You will not be figuring out how to cash flow $50K+ for 4 years and that will be a good thing

$50k? Top privates run $80k or over NOW. How old are your kids, OP? If you can fully fund your retirement (up to limit with match), by all means keep contributing. Just monitor like any other investment account. Such a gift for your kids. We were like your friends, and made a stupid mistake by not starting 529s earlier.

I was suggesting 50K as a mid point---instate public schools. I know most privates are 80K+ already. Living that with my own kid currently. Thankfully we have a fully funded 529 for them

$50K is a very generous budget (at current prices). Nobody needs to spend $80K per year for college. Sure, spend it if you want to but I am 100% certain that anybody paying that bill could have gone to a lower cost college if they were willing to be a smarter shopper. We pay $26k/year for one kid at an in-state school. His other options were as much as $45k for an OOS public with merit. Current senior has several offers at about $30K, a couple in the $40-$50k range, and an in-state public for $20k.