college children and money

[Anonymous]

USC and UCLA, wow. I’m curious OP, when the crosstown rivals compete in athletic games, who do you cheer for?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
By not giving money to #2, you’re essentially telling him that hard work doesn’t matter and all of his hard work in getting the athletic scholarship do not matter. Yes, life is not fair but parents need to treat both kids evenly, especially with money. If #2 wants to share that money with #1, that’s up to him, not the parents. Of course, it is the parents money and they can do whatever they want, but it is a two way relationship and #2 is within his right not to speak to his mother because of this.

Wow---wouldn't want to live in your life. Where everything is about money and you are not capable of working hard unless you are rewarded monetarily.

If my kid stopped talking to me because I did not give them the rest of their "college fund" I would wonder where we had gone wrong raising such an entitled brat

Well, I work for Google and going by your logic, why would I work hard if I get paid the same salary as someone who is not, right?

As parents, I need to treat ALL of my kids fairly. In other words, I will divide my assets in 1/3 to each child. They can divide among themselves if one sibling should get more than the other, that's not my job. I hope I raise them well enough that they will do the right thing.

#2 is within his right to ask for that money that was set aside for his education.

Very different situation---you work hard at your job because yes, someone with 5 years experience will get paid more than a new hire and if you do well you will get more raises/bonuses than someone who just slides by.

However, unless the parents say "there is $400K for each of you for college. How you spend it is up to you---undergrad and grad or use it all for undergrad or don't use it all and get a scholarship. Whatever is left we will find a way to transfer to you", the money is not the kids.
We personally agreed to pay for all college expenses for our kids---if it's 90k/year and medical school or 20K/year and no grad school. We don't keep track of "who spent what and the other gets the difference".

So unless parents stated this to their kids during HS/college decision making process, I'd be embarrassed to have a kid feel they are entitled to more $$$$.
Then again, we have enough money so we didn't want our kids selecting a school just because it was cheaper....we allowed one kid to turn down $160K in merit (over 4 years) and instead go to another $80K+ school without any merit/FA. 95% of kids would have been forced to attend the school with merit simply for financial reasons. Instead our kid selected the best fit school for them and is doing extremely well and is happy. But that doesn't mean our other kids who only spent $40K/year get extra $$$---they picked the right school for them.

[Anonymous]

Is this money in a 529 with each child as the beneficiary?

I wouldn't change beneficiaries on any accounts. The IRS does consider money in a 529 to be for the benefit of that beneficiary, not the account holder.

If it's in a 529, talk to an accountant. There are several options to what to do with 529 money if a beneficiary earns a scholarship or doesn't need it.

If this is an account that is only in your name, different story. You can do whatever you want with the money in that case, and the students don't get a say unless you offer it to them.

[Anonymous]

We have a similar situation, but less $ involved.

DS #1 went to in state school and we paid everything for @$150K. DS #2 went to Service Academy, so no cost at all. We do not intend to give DS #2 the equivalent we saved and he does not expect it. We did offer to help with grad school in the future, but he may do that on the military's dime also. We will hang on to the $ and maybe divide it between future grandchildren if they come.

DH and I were totally in synch on this decision. You can never be, nor should you try to be, completely fair with spending. Life expenses will be different - weddings, grandchildren, vacations, emergencies. It seems very transactional to tally up the differences.

[Anonymous]

Is it in a 529? DS2 can use 35k for an IRA, continue using for further education and save the rest for his kids. Do not take out of the 529.

[Anonymous]

OP, I read this last night, then skimmed it just now. I'm with your wife for sundry reasons with the two most salient ones being: you never know if you will need that money later on in life and your DC shouldn't be rewarded for this behavior. I would think I had failed if I had a kid who expected the money that the money we had set aside from college was immediately available to them if they were awarded a scholarship. TBH, I have one kid who might make a run at it, but there is NO WAY they would stop talking to us if we objected. They would simply shrug, say "oh well," and move on.

[Anonymous]

Anonymous wrote:We have a similar situation, but less $ involved.

DS #1 went to in state school and we paid everything for @$150K. DS #2 went to Service Academy, so no cost at all. We do not intend to give DS #2 the equivalent we saved and he does not expect it. We did offer to help with grad school in the future, but he may do that on the military's dime also. We will hang on to the $ and maybe divide it between future grandchildren if they come.

DH and I were totally in synch on this decision. You can never be, nor should you try to be, completely fair with spending. Life expenses will be different - weddings, grandchildren, vacations, emergencies. It seems very transactional to tally up the differences.

+1

Agreed! You provide for your children as best you can at that time in their lives with the money you have. You don't give one kid a $20K gift at 18 because they didn't have learning issues that required ST/OT and advanced tutoring. You also dont give one kid $6K because they didn't need braces. Normal families do not function under the belief that life is just monetary transactions and everyone needs to be equal.

[Anonymous]

OP...you guys handled this wrong. Your kids should have known, "We will make sure you graduate from college debt free. We will pay for room, board, books, tuition, medical expenses. You pay for beer and pizza money through jobs." They know too much.

I do wonder, is part of the issue that your athletic kid doesnt want to do the sport anymore? I DO think you should give him the option of quitting and then you agree to pay the gap of the scholarship. He shouldnt have to play the sport if he doesnt want to and sibling is getting a full ride from parents, since parents have money for him saved not to play.

Stopping talking to you is unacceptable and should no be rewarded.

[Anonymous]

Anonymous wrote:Each kid gets $550K. How they choose to spend it is their choice. Because Son#1 chooses to spend it all, does not mean because Son #2 doesn't, that Son #2 should give 1/2 to his brother. It means son #1 should have spent his money more wisely and stop being greedy. Why should son #1 get more. They should get equal. I will never speak to my sibling again over money. Fair is each gets the same amount and they need to understand how they spend it impacts later choices.

This is a very transactional and unfulfilling way to look at family and spending within families. If I had raised DS#2 in the OP, I would have felt that I had done something wrong. My youngest would absolutely ask if he were DS#2. But I would laugh at him and he would go in with life happily talking to both me and his sibling (and looking for other ways to bend life circumstances in his favor).

What if in the future, DS#2 has no children and DS#1 has two. Would DS #2 be entitled to demand his “share” of grandparent gifts? Where does this type of accounting end?

[Anonymous]

Anonymous wrote:
Each child gets the share that was planned for them or what's left of their share. There is no transfer of one fund to the other. That would be terribly unfair, since there was no discussion prior to enrollment that a transfer might be a possibility should one of them receive a scholarship.

In the future, everyone needs to understand that big money questions need to be fully explored, and things need to be spelled out on paper. No verbal agreement that some then conveniently forget. Since it's family, and contracts are probably not enforceable, a written honor agreement should suffice.

OMG. No! What in the world?! Kids are not entitled to "full exploration" and "things spelled out on paper" of their parents' money. Absolutely not.

[Anonymous]

Anonymous wrote:

Anonymous wrote:
Each child gets the share that was planned for them or what's left of their share. There is no transfer of one fund to the other. That would be terribly unfair, since there was no discussion prior to enrollment that a transfer might be a possibility should one of them receive a scholarship.

In the future, everyone needs to understand that big money questions need to be fully explored, and things need to be spelled out on paper. No verbal agreement that some then conveniently forget. Since it's family, and contracts are probably not enforceable, a written honor agreement should suffice.

OMG. No! What in the world?! Kids are not entitled to "full exploration" and "things spelled out on paper" of their parents' money. Absolutely not.

That’s why at least one of your kids will resent you in adulthood.

Kids want to be treated fairly. They know the world isn’t fair. Their parents should be.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
Each child gets the share that was planned for them or what's left of their share. There is no transfer of one fund to the other. That would be terribly unfair, since there was no discussion prior to enrollment that a transfer might be a possibility should one of them receive a scholarship.

In the future, everyone needs to understand that big money questions need to be fully explored, and things need to be spelled out on paper. No verbal agreement that some then conveniently forget. Since it's family, and contracts are probably not enforceable, a written honor agreement should suffice.

OMG. No! What in the world?! Kids are not entitled to "full exploration" and "things spelled out on paper" of their parents' money. Absolutely not.

That’s why at least one of your kids will resent you in adulthood.

Kids want to be treated fairly. They know the world isn’t fair. Their parents should be.

Stop trolling!

[Anonymous]

OP here. My wife and I got on the zoom call yesterday with both DS#1 and DS#2 and we agreed to put this to a vote. The result was 3 to 1 with my wife being the lone dissenter. I will invest 350K for DS#2 and he will get access to that money after graduation. DW is still not happy with the outcome but oh well. She didn't think that #1 would go against her but he did. I am happy and it is time to do something fun.

[Anonymous]

I feel like I am watching an episode of Succession!

Glad you resolved, but don't think this will be the end of this discussion and hope you are prepared for the future bean counting of every expense. And accounting for all past expenses.

[Anonymous]

Anonymous wrote:OP here. My wife and I got on the zoom call yesterday with both DS#1 and DS#2 and we agreed to put this to a vote. The result was 3 to 1 with my wife being the lone dissenter. I will invest 350K for DS#2 and he will get access to that money after graduation. DW is still not happy with the outcome but oh well. She didn't think that #1 would go against her but he did. I am happy and it is time to do something fun.

how did you make all that money? you sound stupid.