Anyone else spending $7000 oer month (or more) on tuition from earned income?

[Anonymous]

Public schools- so no tuition. However, we have 2 kids and each get 2 hours per week with a tutor at $80/hr. So, we spend about $1200/month on education (outside of our taxes...).

[Anonymous]

No, we spend $1700 on $110k HHI and are stretched thin.
However, at the moment it buys us time and gives us peace of mind.

[Anonymous]

Anonymous wrote:We have had one child in independent school for a few years (starting in middle school), and our second child will start independent school in the fall for 6th grade. (We have been in MCPS for elementary.)

As of June 5th, we went from paying $4000 per month in tuition to paying $7000 per month in tuition. I knew it was coming, but it is such a large amount. Our total net income per month is $13,000 (HHI of approximately $380,000 with both DH and I working full time.)

I sense a lot of people pay tuition from investment income, and perhaps not out of salaries.

Does it seem a bit absurd to pay $7000 per month for two kids to attend 6th and 8th grades?

(BTW, I know that these tuition amounts are for 10 months of the year, and not all 12 months)

How are you calculating "net" income? Even if you pay percent that's right though how come you're net income would be $190,000 per year, which is more that 15,800 per month. That's a pretty big difference.

[Anonymous]

Yes, I know it is just preschool but here's my story.

We spent a small fortune on our four kids' preschool, convinced that their early learning years were so so so important and that this amazing preschool was going to make a difference. By the time the second finished kindergarten (public) we started to realize that, for the most part, his classmates who went to less expensive preschools seemed to be doing just as well as he was, but by then number 3 was in the expensive preschool. Number 4 came along and we thought how can we do any less for this one than we did for the first 3, even though it was clear to us at that point that although we loved the preschool, #4 would be fine regardless.

Fast forward to the present with 2 in college and another not far behind. How I wish we had been willing to admit to ourselves that our children did not need to attend the ridiculously expensive preschool and saved it for college instead.

[Anonymous]

OP here. (Someone above may have seemed like me, but was not me.)

Our net income may be lower because some of my DH's compensation is deferred, and so we don't see it in a monthly paycheck. (It goes to his profit-sharing account, which is kind of like a retirement account.)

We are fortunate in that we don't need to set aside money for college because my in-laws have covered that. (Each kid's 529 has about $200,000 in it, which we figure will be enough.)

Our mortgage on our house in Bethesda is $2000/month.

[Anonymous]

Anonymous wrote:OP here. (Someone above may have seemed like me, but was not me.)

Our net income may be lower because some of my DH's compensation is deferred, and so we don't see it in a monthly paycheck. (It goes to his profit-sharing account, which is kind of like a retirement account.)

We are fortunate in that we don't need to set aside money for college because my in-laws have covered that. (Each kid's 529 has about $200,000 in it, which we figure will be enough.)

Our mortgage on our house in Bethesda is $2000/month.

Then you should be fine. Low mortgage - college and retirement covered. Not much left over for other stuff, though. Private school families tend to get caught up in keeping up with the joneses on vacations, clothes and activities.

[Anonymous]

Yes two kids at top, expensive school.

[Anonymous]

I would do it as long as the school guarantees my
child will become the CEO of a Fortune 100 company.
Then yeah absolutely, otherwise, no.

[Anonymous]

Personally, I would not be at all comfortable with it. You'll be OK, but you're sacrificing financial independence, which I'm not willing to do. I agree with the PP that the preschool analogy applies, and I'm glad I figured that out even before she did and didn't waste our money on a stupidly expensive preschool.

[Anonymous]

Anonymous wrote:OP here. (Someone above may have seemed like me, but was not me.)

Our net income may be lower because some of my DH's compensation is deferred, and so we don't see it in a monthly paycheck. (It goes to his profit-sharing account, which is kind of like a retirement account.)

We are fortunate in that we don't need to set aside money for college because my in-laws have covered that. (Each kid's 529 has about $200,000 in it, which we figure will be enough.)

Our mortgage on our house in Bethesda is $2000/month.

No offense, OP, but Jesus Christ. You left out three incredibly significant factors in your initial question. When asking people if it is nuts to spend so much money, you didn't think that (i) your housing payment, and (ii) the fact that you don't need to worry about college, and (ii) that even though you save only 5% in retirement accounts, a significant portion of your husband's comp is put into a profit sharing account are relevant? Good grief.

[Anonymous]

Anonymous wrote:Do you have a mortgage? Are you saving for college? While it seems that you can pay the bill, it doesn't leave much room for after-tax savings. But if college and your mortgage aren't an issue, you're fine.

This! These threads complaining about the cost are so annoying. You knew it was this expensive going into it. If you have to ask, is it worth it, you can't afford it. You're in a group who can afford $7k a month with ease. That's what it means to be rich rather than simply UMC like the OP.

[Anonymous]

Anonymous wrote:

Anonymous wrote:What's you're current mortgage? I have to think that if you added it to 7k you'd be able to get a house in pretty much any excellent school district in the area and then be able to fund your retirement properly (5% isn't properly).

Mortgage is $2100. We love our house and neighborhood and would never move. There are other factors outside the public school.

I would rather work an extra 10 years and be able to give me kids their current school than save more for retirement now. We have met with a financial planner. We wont be able to retire extravagantly but we will be just fine, especially with our house paid off. We are relatively young (started having kids in our late 20s, done by 35.) Last kid will be out of college by 57 and we can easily work 10 more years at that point if we need to.

FYI -- the above comments are not from me (the OP). Both my DH and I max out our retirement. But coincidentally, we do have a similar mortgage payment to the PP ($2000/month).

[Anonymous]

What are you smoking OP?! $200k isn't enough for college and grad school! You'll need 2x that and your kids are old!!!! You don't have that much time to save! Get on that, pronto.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Do you have a mortgage? Are you saving for college? While it seems that you can pay the bill, it doesn't leave much room for after-tax savings. But if college and your mortgage aren't an issue, you're fine.

This! These threads complaining about the cost are so annoying. You knew it was this expensive going into it. If you have to ask, is it worth it, you can't afford it. You're in a group who can afford $7k a month with ease. That's what it means to be rich rather than simply UMC like the OP.

OP here. I really wasn't asking if we can afford it. (I know that if I posted this question in the DCUM Money Forum, people would think we were 100 percent crazy to spend $7000/month on tuition, and would say we cannot afford it.) Instead, I was mainly curious if many other people pay this large sum out of current earned income, as I'm guessing a fair number may pay it out of investments. I figured that would be best done on this Private/Independent School Forum. Thank you.

[Anonymous]

Income similar to yours. We did it for many years. This last year, we really began think that this is unsustainable for the long term. Our kids will be going to public school next year. I feel sick about it, but am also immensely relieved not to be worrying about money constantly. We planned a nice vacation for this summer (cost less than 10% of tuition cost for two) and plan on saving the rest of what we would have paid. It's a liberating feeling for now. I'll have to give it a year before I determine if it was worth it or if we'll be calling our school begging them to let us back in.