How to pay for college: specific scenario

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We have money, and the plan was in-state tuition at the flagship (with CC and transferring in as the Plan B).

Generous relative threw a wrench into our (read: parents’) plan.

Kid opted to go out of state and loves it there, so now we are evaluating options.

While we can bring some cash to the table, we can’t cover everything…right now. (We will likely inherit some cash that we will use to help pay off student loans, but that will likely be a decade down the road).

I suppose I am wondering what the best options are in terms of loans and where to start.

House is worth $700k+ and we owe roughly $200k. Mortgage is low ($1700/month).

We won’t touch our retirement or investments. (We also both have pensions available down the road.)

You really screwed up and are selfish. You overbought an expensive house and refuse to change your lifestyle. Kid has to drop out.

?

We bought a $400k house that has appreciated in value over time. Our mortgage is $1,700.

Our kid isn’t screwed.

They can take out loans or transfer in-state.

We will help. We just can’t pay $50k+ each year to cover tuition, etc. outright.

If they live at home and commute to the state flagship, we could fully cover tuition. They just don’t want to. That’s what I’m dealing with currently.

You let them go to this school. You have plenty of money and can afford it but don't want to. You have a pension, savings, and retirement and yet choose to save nothing for college. You set them up to fail. Sounds like you choose to live more comfortably and not make important things like college a priority. You're expecting others to pay failed.

Again…???

We have more than one child (the oldest is a freshman).

Our forever home cost $400k and we have a $1,700 mortgage. That’s not extravagant, and it’s well below what we could technically afford.
We drive basic cars until they die.

We are saving aggressively for retirement and will have modest pensions. We live in a high cost area and are anchored here thanks to our jobs as well as caring for elderly parents.

We did save for college as best we could and continue to do so for all our children.

We can cover some tuition, but not all (not even close).

Had kid gone in-state, it would be easier but still not fully covered for 4 years.

Kid chose to go out of state against our counsel. What should we have done? Locking them in the basement didn’t seem wise.

While I am thrilled for everyone who only has one or two kids and earns enough to cover $200-300k per kid for college, that’s not us. And I suspect most Americans are in my boat. We have other kids to consider along with our own retirement and caregiving for our elderly parents. The future inheritance a decade from now won’t be life-changing, but it will help us to help our kids with college (in real time or afterwards paying down loans).

PS - I put myself through college and grad school while working. My kid will work this summer and hopefully next year (I wanted them to just focus on school freshman year).

[Anonymous]

So as other PPs have said, this is a really really common scenario, not something specific to you.

I would really think about the other kids in this situation. It sucks if you exhaust all resources to keep your oldest in this school - that you never had a plan for paying for - and they resent the crap out of you and their sibling as they will have no such choice.

Because you have other kids, I would seriously consider requiring your kid to transfer to a place that you can afford between your current college savings + federal loans for the kid (anyone can take the unsubsidized loans). Yes, it will feel awful, but it will not ruin their life.

The other option is that you borrow to cover the difference, but that's not going to be sustainabie across your other kids.

[Anonymous]

How old are you? How far away are you from retirement? Assuming you have less than 20 years to retirement, I would stay away from those (though IRAs can be used for college with no penalty). However, I would consider tapping into your non-retirement investments to the extent you have any. If so, post the amount and how many children.

Otherwise, I would suggest that the kid take out loans if he wants to stay at the school he is at assuming there are no grandparents or childless uncles or aunts who want to contribute.

Finally, all of your over 14 year aged kids need jobs in the summer and babysitting or other weekend jobs for the rest of the year. One third goes into an account that they use for spending money and books.

I graduated

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We have money, and the plan was in-state tuition at the flagship (with CC and transferring in as the Plan B).

Generous relative threw a wrench into our (read: parents’) plan.

Kid opted to go out of state and loves it there, so now we are evaluating options.

While we can bring some cash to the table, we can’t cover everything…right now. (We will likely inherit some cash that we will use to help pay off student loans, but that will likely be a decade down the road).

I suppose I am wondering what the best options are in terms of loans and where to start.

House is worth $700k+ and we owe roughly $200k. Mortgage is low ($1700/month).

We won’t touch our retirement or investments. (We also both have pensions available down the road.)

You really screwed up and are selfish. You overbought an expensive house and refuse to change your lifestyle. Kid has to drop out.

?

We bought a $400k house that has appreciated in value over time. Our mortgage is $1,700.

Our kid isn’t screwed.

They can take out loans or transfer in-state.

We will help. We just can’t pay $50k+ each year to cover tuition, etc. outright.

If they live at home and commute to the state flagship, we could fully cover tuition. They just don’t want to. That’s what I’m dealing with currently.

You let them go to this school. You have plenty of money and can afford it but don't want to. You have a pension, savings, and retirement and yet choose to save nothing for college. You set them up to fail. Sounds like you choose to live more comfortably and not make important things like college a priority. You're expecting others to pay failed.

Again…???

We have more than one child (the oldest is a freshman).

Our forever home cost $400k and we have a $1,700 mortgage. That’s not extravagant, and it’s well below what we could technically afford.
We drive basic cars until they die.

We are saving aggressively for retirement and will have modest pensions. We live in a high cost area and are anchored here thanks to our jobs as well as caring for elderly parents.

We did save for college as best we could and continue to do so for all our children.

We can cover some tuition, but not all (not even close).

Had kid gone in-state, it would be easier but still not fully covered for 4 years.

Kid chose to go out of state against our counsel. What should we have done? Locking them in the basement didn’t seem wise.

While I am thrilled for everyone who only has one or two kids and earns enough to cover $200-300k per kid for college, that’s not us. And I suspect most Americans are in my boat. We have other kids to consider along with our own retirement and caregiving for our elderly parents. The future inheritance a decade from now won’t be life-changing, but it will help us to help our kids with college (in real time or afterwards paying down loans).

PS - I put myself through college and grad school while working. My kid will work this summer and hopefully next year (I wanted them to just focus on school freshman year).

You should have told your child no, that you aren't willing to pay for college an dits not a realistic plan.

You have the money to save for you, overbought an expensive house you cannot afford and had too many kids. We managed to save as we had less kids, bought a house under our means (something you'd never live in), only take vacations every 4-5 years, etc.

You should have them transfer out in the spring and get a job.

[Anonymous]

Anonymous wrote:So as other PPs have said, this is a really really common scenario, not something specific to you.

I would really think about the other kids in this situation. It sucks if you exhaust all resources to keep your oldest in this school - that you never had a plan for paying for - and they resent the crap out of you and their sibling as they will have no such choice.

Because you have other kids, I would seriously consider requiring your kid to transfer to a place that you can afford between your current college savings + federal loans for the kid (anyone can take the unsubsidized loans). Yes, it will feel awful, but it will not ruin their life.

The other option is that you borrow to cover the difference, but that's not going to be sustainabie across your other kids.

The plan was a relative who paid for it who now isn't going to pay for it. They didn't save anything for college.

[Anonymous]

Let me see if I have this right. The aunt gives a one time gift and it pays for your DD’s freshman year (OOS state school). How much $$ was this? $50,000? Did you actually apply for student loans or only complete the calculator to arrive at your no aid offer? If you had applied for the loans, your DD would have been offered $5500 in a loan amount for her freshman year and the aunt’s leftover cash could have moved to her sophomore year. Too late now. You allowed your DD to spend $ 50,000 because…..she had her heart set on the OOS school? Well, now you get to inform her that she cannot return for her sophomore year unless you mortgage your house. I do not recommend this because YOU HAVE OTHER CHILDREN. I am sorry to be so harsh, but what outcome did you imagine?

[Anonymous]

Anonymous wrote:Let me see if I have this right. The aunt gives a one time gift and it pays for your DD’s freshman year (OOS state school). How much $$ was this? $50,000? Did you actually apply for student loans or only complete the calculator to arrive at your no aid offer? If you had applied for the loans, your DD would have been offered $5500 in a loan amount for her freshman year and the aunt’s leftover cash could have moved to her sophomore year. Too late now. You allowed your DD to spend $ 50,000 because…..she had her heart set on the OOS school? Well, now you get to inform her that she cannot return for her sophomore year unless you mortgage your house. I do not recommend this because YOU HAVE OTHER CHILDREN. I am sorry to be so harsh, but what outcome did you imagine?

The parents can co-sign on loans. It’s not the best solution but it’s also not a disaster.

[Anonymous]

Anonymous wrote:Is ROTC a possibility?

The very fact that students should potentially put their lives in danger for education is disgusting and shameful.

[Anonymous]

Your kid takes on whatever loans they need to cover discrepancies. Do not co-sign. If they can’t do that, then they transfer. You can’t afford it. They can’t afford it. It sucks, but it is life.

[Anonymous]

Anonymous wrote:

Anonymous wrote:So as other PPs have said, this is a really really common scenario, not something specific to you.

I would really think about the other kids in this situation. It sucks if you exhaust all resources to keep your oldest in this school - that you never had a plan for paying for - and they resent the crap out of you and their sibling as they will have no such choice.

Because you have other kids, I would seriously consider requiring your kid to transfer to a place that you can afford between your current college savings + federal loans for the kid (anyone can take the unsubsidized loans). Yes, it will feel awful, but it will not ruin their life.

The other option is that you borrow to cover the difference, but that's not going to be sustainabie across your other kids.

The plan was a relative who paid for it who now isn't going to pay for it. They didn't save anything for college.

Wrong.

The gift from the relative came out of left field once the kid was accepted. Relative covered everything for first year.

Kid was counseled to stay in state but opted to go away instead.

Yes, kid qualifies for roughly $5,500 from FAFSA. That’s all.

We can pay for some but not all of the kid’s college expenses. We can essentially cover in-state tuition for all our kids, but not living expenses. They can live at home and commute and not have to worry about student loans.

Our oldest either needs loans or to transfer back home.

^^^
That’s what we are exploring.

And to the poster who insists we bought a home we couldn’t afford and are snobs who are living beyond our means: please explain how a $400k house is a luxury? It appreciated to $700k. We only have a $1,700 mortgage. I doubt many others have mortgages that low.

We did save for college and continue to save for our other kids. Plus, we will receive an inheritance in a decade or so. We are on target for retirement plus long term care. We are doing everything right…aside from not being able to rein in our oldest. We are now crossing that bridge.

FWIW, I handled my own college and grad school. Lots of people do.

[Anonymous]

OP, what is your HHI? You seem like you don't want to disclose it.

[Anonymous]

Anonymous wrote:OP, what is your HHI? You seem like you don't want to disclose it.

+1
agree that there is more details

[Anonymous]

Can you get a side hustle? I went from part time to full time to pay tuition beyond our 529. Eldest finishes next year, youngest starts 2024. 529s cover first year if instate.

[Anonymous]

PP here. I just do not want my kids to have loans with the economy being so bad etc etc. the compound interest, etc. we are middle class not wealthy by any means but my blue collar Mom did it for me so I’m paying it forward for our kids.

[Anonymous]

Your kid chose to go to a college OOS knowing they could only go one year? Then they made their choice. Time to transfer back home.