Child expenses argument

[Anonymous]

Anonymous wrote:

Anonymous wrote:Op here. How much is needed in 529 for a kid to attend college for 4 year colleges?

Do not kill your money in 529.

A 529 in MD gives you more tax advantage than a Roth, because of the state deduction on contributions. Why is it bad, because of the 0.3% fund fees?

Anyways to OP, public in state tuition is generally around $30k a year, half of which is room and board. So minimum $60k for a college education if they are a commuter, then it jumps up to $120k living on campus, then up to $200k-$300k going out of state, and up to $400k for high end private colleges.

[Anonymous]

You are spending a lot of money on after school care for a family whose parents are mostly WFH. I would stop that right now.
They are not too young to come home and have an after school routine that does not require heavy parental involvement. Just let the kids come home and they can get themselves a snack, do their homework, or play outside. They will understand that Dad needs to finish his workday and they are not to disturb him unless there is an emergency.

It’s also not the worst thing for kids to have an hour of screen time after school while their parent finishes their workday.
My kids are now teens but this was the routine for years since I’ve been WFH.

Student loans are a bad plan for college. Interest rates are high, and there is less and less of a guarantee that kids will be able to get jobs that will help them afford these loans.

You really do need to stop spending stupid levels of money on kids after school care, and you can probably cut back on camp spending too. You need to put that money towards their college because odds are they will need it then, because even if cost increases slow down, they will still be high and there is a good chance that by then you or your spouse will experience career changes, layoffs and ageism, or be really tired of the rat race and not be able to keep going at that rate. Trust me, you do not want to be in a position of having to cash flow college or rely on student loans. Ask me how I know.

[Anonymous]

Anonymous wrote:You are spending a lot of money on after school care for a family whose parents are mostly WFH. I would stop that right now.
They are not too young to come home and have an after school routine that does not require heavy parental involvement. Just let the kids come home and they can get themselves a snack, do their homework, or play outside. They will understand that Dad needs to finish his workday and they are not to disturb him unless there is an emergency.

It’s also not the worst thing for kids to have an hour of screen time after school while their parent finishes their workday.
My kids are now teens but this was the routine for years since I’ve been WFH.

Student loans are a bad plan for college. Interest rates are high, and there is less and less of a guarantee that kids will be able to get jobs that will help them afford these loans.

You really do need to stop spending stupid levels of money on kids after school care, and you can probably cut back on camp spending too. You need to put that money towards their college because odds are they will need it then, because even if cost increases slow down, they will still be high and there is a good chance that by then you or your spouse will experience career changes, layoffs and ageism, or be really tired of the rat race and not be able to keep going at that rate. Trust me, you do not want to be in a position of having to cash flow college or rely on student loans. Ask me how I know.

I know people who are spending $4-5k a month on a mortgage and the OP has HHI of $300k with no debt. You are fretting over them spending $2k/month unnecessarily on their kids activities? Let's get real here. They can afford this easily. There is exactly zero financial struggles faced by the OP. Its purely a problem of perspective and priorities. They would have the college problem solved by making a few bank transfers and setting up some monthly contributions.

[Anonymous]

Anonymous wrote:Your kids are still young, you can drop $100k each into 529s and basically consider college funded, then the last $100k is your emergency fund. Your retirement savings seems low for 2 workers.

If you need aftercare to have your jobs then you need it and there's no real argument to be had, but you can look for cheaper camps. 10% of your gross on aftercare/camps seems high to me but I'm kind of lucky in that we don't have to pay for aftercare at all so I may have unreasonable expectations.

This is good advice. Do this with the money in your bank account. Your college payment questions will be answered and you can think more clearly about other expenses.

I did something similar with an inheritance I received when my kids were in 2nd and 5th grade (not literally in a 529, but invested in a separate account that in my mind is for college and that I won't touch until they are in college. Not in a 529 just in case they get scholarships).

[Anonymous]

I'm not getting where all the money is going without a mortgage?

[Anonymous]

Anonymous wrote:You are spending a lot of money on after school care for a family whose parents are mostly WFH. I would stop that right now.
They are not too young to come home and have an after school routine that does not require heavy parental involvement. Just let the kids come home and they can get themselves a snack, do their homework, or play outside. They will understand that Dad needs to finish his workday and they are not to disturb him unless there is an emergency.

It’s also not the worst thing for kids to have an hour of screen time after school while their parent finishes their workday.
My kids are now teens but this was the routine for years since I’ve been WFH.

Student loans are a bad plan for college. Interest rates are high, and there is less and less of a guarantee that kids will be able to get jobs that will help them afford these loans.

You really do need to stop spending stupid levels of money on kids after school care, and you can probably cut back on camp spending too. You need to put that money towards their college because odds are they will need it then, because even if cost increases slow down, they will still be high and there is a good chance that by then you or your spouse will experience career changes, layoffs and ageism, or be really tired of the rat race and not be able to keep going at that rate. Trust me, you do not want to be in a position of having to cash flow college or rely on student loans. Ask me how I know.

This is nonsense. They have plenty of money and can afford to have their kids attend aftercare and camp instead of vegetating in front of screens.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Op here. How much is needed in 529 for a kid to attend college for 4 year colleges?

Do not kill your money in 529.

A 529 in MD gives you more tax advantage than a Roth, because of the state deduction on contributions. Why is it bad, because of the 0.3% fund fees?

Anyways to OP, public in state tuition is generally around $30k a year, half of which is room and board. So minimum $60k for a college education if they are a commuter, then it jumps up to $120k living on campus, then up to $200k-$300k going out of state, and up to $400k for high end private colleges.

Op here. We have no mortgage because we paid them off a few years old. We have no debt, and we pay off our monthly credit card bills in full.

I am confused about MD 529 plan. Should we do investment plan or the prepaid tuition plan? Some pp recommend me to put $100k now this year for 1 kid or 2 kids, isn't it I won't get the tax benefits ( capped at $10k married jointly for 2 kids)? Thank you.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Your kids are still young, you can drop $100k each into 529s and basically consider college funded, then the last $100k is your emergency fund. Your retirement savings seems low for 2 workers.

If you need aftercare to have your jobs then you need it and there's no real argument to be had, but you can look for cheaper camps. 10% of your gross on aftercare/camps seems high to me but I'm kind of lucky in that we don't have to pay for aftercare at all so I may have unreasonable expectations.

This is good advice. Do this with the money in your bank account. Your college payment questions will be answered and you can think more clearly about other expenses.

I did something similar with an inheritance I received when my kids were in 2nd and 5th grade (not literally in a 529, but invested in a separate account that in my mind is for college and that I won't touch until they are in college. Not in a 529 just in case they get scholarships).

Op here. Should I do safe stock investment ( like vanguard) or 529 MD this year ( with $100k this year)? Please advise.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Op here. How much is needed in 529 for a kid to attend college for 4 year colleges?

Do not kill your money in 529.

A 529 in MD gives you more tax advantage than a Roth, because of the state deduction on contributions. Why is it bad, because of the 0.3% fund fees?

Anyways to OP, public in state tuition is generally around $30k a year, half of which is room and board. So minimum $60k for a college education if they are a commuter, then it jumps up to $120k living on campus, then up to $200k-$300k going out of state, and up to $400k for high end private colleges.

Op here. We have no mortgage because we paid them off a few years old. We have no debt, and we pay off our monthly credit card bills in full.

I am confused about MD 529 plan. Should we do investment plan or the prepaid tuition plan? Some pp recommend me to put $100k now this year for 1 kid or 2 kids, isn't it I won't get the tax benefits ( capped at $10k married jointly for 2 kids)? Thank you.

I'd do investment plan not prepaid. You can carry forward the deduction for up to 10 years. Create 3 accounts for each kid. In the Maryland 529 plan fund $25k in each of: Mom account for Kid 1, Dad account for Kid 1, Mom account for Kid 2, Dad account for Kid 2. Then put $50k in a Vanguard 529 (Nevada) for each kid. You can deduct $10k total off your state taxes per year for the next 10 years for the funds in the MD accounts, and you should be effectively done saving for college as long as you encourage your kids to make money-conscious decisions.

[Anonymous]

You are in a good situation, OP. No mortgage, and you have enough money to fund your kids college expenses right now. I think once your move the $300k from the bank into an investment for that purpose, you'll be totally fine.

Camps and after school expenses will go away in middle school.

[Anonymous]

Anonymous wrote:DH earns $170k, and I earn $130k. I am the primary caregiver of 2 ES kids. We spend like $25k to $28k in after school cares and summer camps every year for 2 kids. Is that too much money on children? We are debt free with no mortgage and no loans. We are in mid 40s with $450k 401k, IRA/Stock $300k, bank savings 300k( not sure what to do), zero 502. DH now says worrying about college funds and retirement. It was his idea not to save any on 502 because he told me that they could get student loans. Now, he blames me.

He can always go to work early (6am) and leave early to save the afternoon care. There is nothing you can do about summer but pay for care.

[Anonymous]

Anonymous wrote:OP here. For 2 kids, after school cars are around $14k. For 2 kids, summer camps for 8-9 weeks are $11k to $14k, and that includes specialty camps (art, dance and sports) and a week of sleepaway camp.

DH works from home M-F, and I work at home for 2 days a week. He grew up with zero after school care and zero summer camps, and so did I. He thinks kids do not need any after school cares, and they can do with either zero or cheap summer day camps. He does not understand why our kids cannot just stay home doing their own things/entertaining themselves without screentime after school or at summertime. I personally do not want to take care of kids while working at home. I also do not want to worry about kids at office when they stay home with DH. I know that DH will not take care of them, and kids may fight together or spend too much time on screentime.

I don't understand if we can afford, why we can't send our kids to better summer camps that they would enjoy. If I send them to cheaper summer camps, I know some families can pull off with $4k-$6k for 2 kids. Those are basic daycare with some activities.

Excellent, leave the two kids with him after school for a semester if he cares so much about saving money.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Op here. How much is needed in 529 for a kid to attend college for 4 year colleges?

Do not kill your money in 529.

A 529 in MD gives you more tax advantage than a Roth, because of the state deduction on contributions. Why is it bad, because of the 0.3% fund fees?

Anyways to OP, public in state tuition is generally around $30k a year, half of which is room and board. So minimum $60k for a college education if they are a commuter, then it jumps up to $120k living on campus, then up to $200k-$300k going out of state, and up to $400k for high end private colleges.

Op here. We have no mortgage because we paid them off a few years old. We have no debt, and we pay off our monthly credit card bills in full.

I am confused about MD 529 plan. Should we do investment plan or the prepaid tuition plan? Some pp recommend me to put $100k now this year for 1 kid or 2 kids, isn't it I won't get the tax benefits ( capped at $10k married jointly for 2 kids)? Thank you.

I'd do investment plan not prepaid. You can carry forward the deduction for up to 10 years. Create 3 accounts for each kid. In the Maryland 529 plan fund $25k in each of: Mom account for Kid 1, Dad account for Kid 1, Mom account for Kid 2, Dad account for Kid 2. Then put $50k in a Vanguard 529 (Nevada) for each kid. You can deduct $10k total off your state taxes per year for the next 10 years for the funds in the MD accounts, and you should be effectively done saving for college as long as you encourage your kids to make money-conscious decisions.

The MD prepaid 529 is being phased out and not accepting new enrollments so that decision is easy. I also dont think u need to open separate accounts for mom and dad, or if you do im doing it wrong, haha.