How to pay for college: specific scenario

[Anonymous]

Anonymous wrote:There’s part of this I’m having difficulty understanding. The FAFSA of $0 aid has to be because the sum of your HHI, investments, 529, retirement assets, and home equity is sufficient that if you use all those resources plus loans you can cover the cost of college. Admittedly that’s for kid#1 only, but the truth is that not paying for the OOS college is a choice. Your choice. If you spend down the investments and borrow against home equity and take out loans, your financial position will eventually adjust such that your FAFSA-derived aid is more than $0. This will benefit the current student and future children’s cost of attendance, but yes, will cost you a lot.

The expectation is that putting your kids through college is a financial hardship. If you don’t want to endure it, fine, but it’s a choice that prioritizes your wealth over your children’s future. I get it, you paid for your own college and grad school. So did I. Those things were a lot cheaper then. It’s not plausible for them to do what we did.

I’m not prioritizing my own wealth. I’m prioritizing providing for my family and my retirement.

I think everyone might have a misguided assumption that only rich families don’t qualify for financial aid when in fact most people in dcum likely don’t qualify.

[Anonymous]

Anonymous wrote:Tell is your income you selfish clown

HHI near $180.

4 kids.

Dc metro area.

Supporting elderly parents who didn’t save for retirement. I won’t make that mistake.

[Anonymous]

What a weird story. I feel bad for your child. Why don’t you plan ahead at all? Sell your car if you to, downsize your house. Take out a home equity loan.

Start putting your child first, as you should have been doing all along.

[Anonymous]

Anonymous wrote:What a weird story. I feel bad for your child. Why don’t you plan ahead at all? Sell your car if you to, downsize your house. Take out a home equity loan.

Start putting your child first, as you should have been doing all along.

Okay, I am sorry. I was too harsh.

You kid is not a child anymore. Tell them they either have to transfer orvwill have crushing debt that will impede their lifestyle for decades.

I am actually that a family of 6 got no financial aid with that income.

[Anonymous]

Anonymous wrote:

Anonymous wrote:This is insane. What do you mean you couldn’t “rein in” your kid. You should have said”we can not afford this.”

Your choices now are your kid transfers or you take out expensive Parent Plus loans or you pull cash from your investments/savings. Those are your choices.

This is exactly right. My heart breaks for this kid. OP, why didn’t you say no? I highly doubt the kid and the relative would’ve done this behind your back. You didn’t want to be the bad guy last year and caused this issue.

Sigh

We told our kid they would need to use loans to cover whatever we can’t cover. Now I’m trying to help friends tire out the best approach.

Nobody was blindsided.

There’s still part of me that remains hopeful they’ll transfer.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

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).

Did the generous relative leave you anything when they died?

They left money for our other kids’ education.

I’m confused. They left money for your other children’s education, but not your eldest despite paying for their first year? That does not make sense.

maybe that was all they could afford, there are 4 kids!

[Anonymous]

Anonymous wrote:

Anonymous wrote:What a weird story. I feel bad for your child. Why don’t you plan ahead at all? Sell your car if you to, downsize your house. Take out a home equity loan.

Start putting your child first, as you should have been doing all along.

Okay, I am sorry. I was too harsh.

You kid is not a child anymore. Tell them they either have to transfer orvwill have crushing debt that will impede their lifestyle for decades.

I am actually that a family of 6 got no financial aid with that income.

I’m guessing it has to do with our retirement/investments. Who knows.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

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).

Did the generous relative leave you anything when they died?

They left money for our other kids’ education.

I’m confused. They left money for your other children’s education, but not your eldest despite paying for their first year? That does not make sense.

They left equal amounts for each kid—including the first who went off to college.

How doesn’t that make sense?

[Anonymous]

I am sorry for your stress. This is hard.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Tell is your income you selfish clown

HHI near $180.

4 kids.

Dc metro area.

Supporting elderly parents who didn’t save for retirement. I won’t make that mistake.

19:03 poster here. Back to the FAFSA calculator with this info, in order to get an EFC of $50K I have to put in about $500K in savings. If you do indeed have this kind of money saved up, but can't spend it because of demands on the funds for supporting elderly parents etc., then this is what schools' "special circumstance" processes are for. Have you gone to the financial aid office and put all your cards on the table and explained why your student needs more financial aid?

[Anonymous]

Anonymous wrote:

Anonymous wrote:Tell is your income you selfish clown

HHI near $180.

4 kids.

Dc metro area.

Supporting elderly parents who didn’t save for retirement. I won’t make that mistake.

You have a good income but too many kids. You set up your kid and should never allowed it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

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).

Did the generous relative leave you anything when they died?

They left money for our other kids’ education.

I’m confused. They left money for your other children’s education, but not your eldest despite paying for their first year? That does not make sense.

They left equal amounts for each kid—including the first who went off to college.

How doesn’t that make sense?

Op allowed child to go to a school they did not pay for. They planned on more inheritance that never came. They saved nothing.

[Anonymous]

Anonymous wrote:

Anonymous wrote:There’s part of this I’m having difficulty understanding. The FAFSA of $0 aid has to be because the sum of your HHI, investments, 529, retirement assets, and home equity is sufficient that if you use all those resources plus loans you can cover the cost of college. Admittedly that’s for kid#1 only, but the truth is that not paying for the OOS college is a choice. Your choice. If you spend down the investments and borrow against home equity and take out loans, your financial position will eventually adjust such that your FAFSA-derived aid is more than $0. This will benefit the current student and future children’s cost of attendance, but yes, will cost you a lot.

The expectation is that putting your kids through college is a financial hardship. If you don’t want to endure it, fine, but it’s a choice that prioritizes your wealth over your children’s future. I get it, you paid for your own college and grad school. So did I. Those things were a lot cheaper then. It’s not plausible for them to do what we did.

I’m not prioritizing my own wealth. I’m prioritizing providing for my family and my retirement.

I think everyone might have a misguided assumption that only rich families don’t qualify for financial aid when in fact most people in dcum likely don’t qualify.

You have a good income. You are rich.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:This is insane. What do you mean you couldn’t “rein in” your kid. You should have said”we can not afford this.”

Your choices now are your kid transfers or you take out expensive Parent Plus loans or you pull cash from your investments/savings. Those are your choices.

This is exactly right. My heart breaks for this kid. OP, why didn’t you say no? I highly doubt the kid and the relative would’ve done this behind your back. You didn’t want to be the bad guy last year and caused this issue.

Sigh

We told our kid they would need to use loans to cover whatever we can’t cover. Now I’m trying to help friends tire out the best approach.

Nobody was blindsided.

There’s still part of me that remains hopeful they’ll transfer.

So relative and student hatched this plan… and then what? You stepped back and let it all go down? Did relative take them dorm shopping? Drop them off at school? At what point did you wash your hands of this situation knowing you would eventually end up here?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Tell is your income you selfish clown

HHI near $180.

4 kids.

Dc metro area.

Supporting elderly parents who didn’t save for retirement. I won’t make that mistake.

You have a good income but too many kids. You set up your kid and should never allowed it.

Well my sibling died and I’m raising their kid.

Geez, I always knew Dcumlandia was a harsh place, but you people are particularly harsh.