College applications -- apply to $$$$ schools or not?

[Anonymous]

Anonymous wrote:OP - why are you asking for advice, you clearly don’t want it. Is it a humblebrag and you do not like that more people are not impressed with you?

You have your life figured out the way you want it. You are happy living on 100K/year. You have a housing you are happy with at a reasonable price, etc, etc.

You seem bound and determined to convince people that you can afford to spend 25 percent of your liquid net worth on college for your kids but only if they get into An Ivy and you can understand the value of it. Bully for you.

We cannot possibly answer that question for you as it is personal and a function of your values and anytime someone throws something out that is different that what you already know you get defensive.

Kid still has to get in, too. Just be sure to have some reasonable safety schools OP and don’t let your kid know how much you want them to go to this specific school.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP - why are you asking for advice, you clearly don’t want it. Is it a humblebrag and you do not like that more people are not impressed with you?

You have your life figured out the way you want it. You are happy living on 100K/year. You have a housing you are happy with at a reasonable price, etc, etc.

You seem bound and determined to convince people that you can afford to spend 25 percent of your liquid net worth on college for your kids but only if they get into An Ivy and you can understand the value of it. Bully for you.

We cannot possibly answer that question for you as it is personal and a function of your values and anytime someone throws something out that is different that what you already know you get defensive.

Kid still has to get in, too. Just be sure to have some reasonable safety schools OP and don’t let your kid know how much you want them to go to this specific school.

Haha, it’s kid that wants to go to that school not me and as of right now he won’t be applying as nothing in this conversation or any research I’ve done has yet convinced me it’s worth the cost.

And do you not think that most people spend more than 25 percent of their net worth on college? I mean normal people. Not DCUM rich.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP - why are you asking for advice, you clearly don’t want it. Is it a humblebrag and you do not like that more people are not impressed with you?

You have your life figured out the way you want it. You are happy living on 100K/year. You have a housing you are happy with at a reasonable price, etc, etc.

You seem bound and determined to convince people that you can afford to spend 25 percent of your liquid net worth on college for your kids but only if they get into An Ivy and you can understand the value of it. Bully for you.

We cannot possibly answer that question for you as it is personal and a function of your values and anytime someone throws something out that is different that what you already know you get defensive.

Kid still has to get in, too. Just be sure to have some reasonable safety schools OP and don’t let your kid know how much you want them to go to this specific school.

Haha, it’s kid that wants to go to that school not me and as of right now he won’t be applying as nothing in this conversation or any research I’ve done has yet convinced me it’s worth the cost.

And do you not think that most people spend more than 25 percent of their net worth on college? I mean normal people. Not DCUM rich.

OP your tone is so defensive and nasty. Why would anyone take your seriously or have empathy for you at this point? People are going to share their points of view because you asked. Then when you don't agree you lash out.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If I were you OP, I would look at inexpensive public universities or schools that offer merit. You don't have enough saved to afford an Ivy and your kid will be taking on incredible debt assuming you don't qualify for aid. If your kid applies and gets into one of those elite schools, it will be even worse to have to turn it down. Focus on schools you can realistically pull off financially. Depending on what your kid wants to do, he might have to go to graduate school...even more expense.

I say this as someone who paid full freight to two very expensive private universities, but we had all that money saved for each kid in the 529 on top of our $13M net worth.

Oh FFS, what planet do you live in where 4.2 million in net worth takes on debt to go to college????

$1M of that net worth is a home. So in reality it is only $3M+. Of That $3M, there is tax liability on the retirement accounts of over $2.4M, which I calculate to be at least $600K. So there really isn't much left for this couple's retirement because their current income is barely big enough to keep up with expenses ($280K including dividends). Like I said in a PP, the couple should think hard about their future plans and consider what lifestyle they plan for their retirement.

And ideally should not be spending $100K+/year on education, when their kid could do a great education for $40K (or less). The OP is not set for retirement and cannot afford to drain $300K+ extra for college, when it's not needed

How do you define “set for retirement”? With those types of assets she can expect $20k a month by retirement, considerably more than enough given her current expenses.

[Anonymous]

There’s a considerable lack of sophistication in the responses here. It looks as if most PPs are considering OPs assets to be finite and not taking into account growth (only possible downturn), cash flow, or time.

That 900k could easily be diminished by 4 percent a year, throwing off 36k. OP also mentioned RMDs (presumably taxable?) of $25k currently. That will likely go up. Perhaps there is also salary growth.

Looking just at the 600 left after using 300 earmarked for college, that throws off 24k at a 4 percent spend down. Assume that 300 is higher by the time one or both kids go to college - it would be reasonable to plan for $40k per year per kid from that fund. Plus the $24k from the 600 and the $25k from the RMD and that’s already $99k per kid, assuming they don’t overlap in school. Some of that will be taxable reducing the amount available but still within reach when cash flow is taken into account.

Then factor in the likelihood that BOTH kids get in to an Ivy. It’s more likely that neither will, or just one with the second going somewhere lower cost. Is it doable? Yes. These numbers don’t even factor in cash flow. OPs costs are low. If they reduce their retirement contributions they can certainly also contribute a considerable amount from cash flow, so there are multiple scenarios to make this work.

Of course, they also need to consider the impact on future wealth. While there are multiple scenarios where there would not be a significant hit on overall net worth, this would certainly reduce the actual value of future net worth, not least because it limits not only the money removed but also the growth potential of those funds.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP - why are you asking for advice, you clearly don’t want it. Is it a humblebrag and you do not like that more people are not impressed with you?

You have your life figured out the way you want it. You are happy living on 100K/year. You have a housing you are happy with at a reasonable price, etc, etc.

You seem bound and determined to convince people that you can afford to spend 25 percent of your liquid net worth on college for your kids but only if they get into An Ivy and you can understand the value of it. Bully for you.

We cannot possibly answer that question for you as it is personal and a function of your values and anytime someone throws something out that is different that what you already know you get defensive.

Kid still has to get in, too. Just be sure to have some reasonable safety schools OP and don’t let your kid know how much you want them to go to this specific school.

Haha, it’s kid that wants to go to that school not me and as of right now he won’t be applying as nothing in this conversation or any research I’ve done has yet convinced me it’s worth the cost.

And do you not think that most people spend more than 25 percent of their net worth on college? I mean normal people. Not DCUM rich.

OP your tone is so defensive and nasty. Why would anyone take your seriously or have empathy for you at this point? People are going to share their points of view because you asked. Then when you don't agree you lash out.

Defensive, maybe but not nasty. I’m not surprised though. Most of the responses seem to ignore the information shared in the OP. And the questions.

[Anonymous]

Has nobody heard of student loans? It doesn't have to be all or nothing: OP can pay for the amount OP is comfortable, and OP's kids can pay the rest.

Assuming OP's kid gets into multiple schools, let the kid decide based on the various price points.

[Anonymous]

Anonymous wrote:Has nobody heard of student loans? It doesn't have to be all or nothing: OP can pay for the amount OP is comfortable, and OP's kids can pay the rest.

Assuming OP's kid gets into multiple schools, let the kid decide based on the various price points.

I personally don’t think anyone should take loans if there is a reasonable school they can attend without loans.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Has nobody heard of student loans? It doesn't have to be all or nothing: OP can pay for the amount OP is comfortable, and OP's kids can pay the rest.

Assuming OP's kid gets into multiple schools, let the kid decide based on the various price points.

I personally don’t think anyone should take loans if there is a reasonable school they can attend without loans.

NP-I agree, as someone who started off in life with loans. Our kids are at flagship. And I also think letting kids decide is a bad idea: You can have a thoughtful, responsible child, but they cannot possibly grasp the reality of loans, expenses adults face because they just don't have the life experience or have had these responsibilities. Establishing parameters for them which are going to be optimal for you and for their future self is really important.

That being said if op cannot pay for college including private, then I am not sure who can. It's always very odd to see the many (too many to be real?) extreme multimillionaires on here tell lesser multimillionaires how poorly they are doing and how concerned they should be about x, y and z, when people like me are living a perfectly fine life on much less than op and not having to take out loans or stretch much.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Has nobody heard of student loans? It doesn't have to be all or nothing: OP can pay for the amount OP is comfortable, and OP's kids can pay the rest.

Assuming OP's kid gets into multiple schools, let the kid decide based on the various price points.

I personally don’t think anyone should take loans if there is a reasonable school they can attend without loans.

NP-I agree, as someone who started off in life with loans. Our kids are at flagship. And I also think letting kids decide is a bad idea: You can have a thoughtful, responsible child, but they cannot possibly grasp the reality of loans, expenses adults face because they just don't have the life experience or have had these responsibilities. Establishing parameters for them which are going to be optimal for you and for their future self is really important.

t

I disagree. While you can certainly try to rationalize with the child and make some suggestions, it seems wild to me to completely close the door to absolute top level colleges without at least seeing the numbers. If the Delta is 400k to an absolute top flagship (ie full ride) is vastly different than say a 100k Delta to a lower tier public school. But you can't know the exact delta a priori. Personally I would have gladly taken out a medium sized loan to go to an ivy and would have begrudged my parents if they didn't even give me the option to apply.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Has nobody heard of student loans? It doesn't have to be all or nothing: OP can pay for the amount OP is comfortable, and OP's kids can pay the rest.

Assuming OP's kid gets into multiple schools, let the kid decide based on the various price points.

I personally don’t think anyone should take loans if there is a reasonable school they can attend without loans.

NP-I agree, as someone who started off in life with loans. Our kids are at flagship. And I also think letting kids decide is a bad idea: You can have a thoughtful, responsible child, but they cannot possibly grasp the reality of loans, expenses adults face because they just don't have the life experience or have had these responsibilities. Establishing parameters for them which are going to be optimal for you and for their future self is really important.

t

I disagree. While you can certainly try to rationalize with the child and make some suggestions, it seems wild to me to completely close the door to absolute top level colleges without at least seeing the numbers. If the Delta is 400k to an absolute top flagship (ie full ride) is vastly different than say a 100k Delta to a lower tier public school. But you can't know the exact delta a priori. Personally I would have gladly taken out a medium sized loan to go to an ivy and would have begrudged my parents if they didn't even give me the option to apply.

That was you, at a time when going to an Ivy was somewhat affordable even with loans. It's vastly different now, especially with flagships having risen in rank. If you can seriously get into an Ivy, you can get into a highly ranked public with merit. But that's just if we are discussing loans. OP's child will not need loans.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Has nobody heard of student loans? It doesn't have to be all or nothing: OP can pay for the amount OP is comfortable, and OP's kids can pay the rest.

Assuming OP's kid gets into multiple schools, let the kid decide based on the various price points.

I personally don’t think anyone should take loans if there is a reasonable school they can attend without loans.

NP-I agree, as someone who started off in life with loans. Our kids are at flagship. And I also think letting kids decide is a bad idea: You can have a thoughtful, responsible child, but they cannot possibly grasp the reality of loans, expenses adults face because they just don't have the life experience or have had these responsibilities. Establishing parameters for them which are going to be optimal for you and for their future self is really important.

t

I disagree. While you can certainly try to rationalize with the child and make some suggestions, it seems wild to me to completely close the door to absolute top level colleges without at least seeing the numbers. If the Delta is 400k to an absolute top flagship (ie full ride) is vastly different than say a 100k Delta to a lower tier public school. But you can't know the exact delta a priori. Personally I would have gladly taken out a medium sized loan to go to an ivy and would have begrudged my parents if they didn't even give me the option to apply.

That was you, at a time when going to an Ivy was somewhat affordable even with loans. It's vastly different now, especially with flagships having risen in rank. If you can seriously get into an Ivy, you can get into a highly ranked public with merit. But that's just if we are discussing loans. OP's child will not need loans.

How do you know OPs kids won't get merit based aid at the ivys? And OP basically said they were comfortable paying X amount. Why would you not at least allow the kid to explore above X?

And I say this as someone in basically OPs situation. We have a fair amount in a 529 to comfortably afford public. If my kids want to explore private with the possibility of loans we are absolutely going to let them. Admittedly if they get into a top tier public and lower tier private we may have to steer them in a particular direction, but we can't know the actual options until they've heard back.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Has nobody heard of student loans? It doesn't have to be all or nothing: OP can pay for the amount OP is comfortable, and OP's kids can pay the rest.

Assuming OP's kid gets into multiple schools, let the kid decide based on the various price points.

I personally don’t think anyone should take loans if there is a reasonable school they can attend without loans.

NP-I agree, as someone who started off in life with loans. Our kids are at flagship. And I also think letting kids decide is a bad idea: You can have a thoughtful, responsible child, but they cannot possibly grasp the reality of loans, expenses adults face because they just don't have the life experience or have had these responsibilities. Establishing parameters for them which are going to be optimal for you and for their future self is really important.

t

I disagree. While you can certainly try to rationalize with the child and make some suggestions, it seems wild to me to completely close the door to absolute top level colleges without at least seeing the numbers. If the Delta is 400k to an absolute top flagship (ie full ride) is vastly different than say a 100k Delta to a lower tier public school. But you can't know the exact delta a priori. Personally I would have gladly taken out a medium sized loan to go to an ivy and would have begrudged my parents if they didn't even give me the option to apply.

That was you, at a time when going to an Ivy was somewhat affordable even with loans. It's vastly different now, especially with flagships having risen in rank. If you can seriously get into an Ivy, you can get into a highly ranked public with merit. But that's just if we are discussing loans. OP's child will not need loans.

How do you know OPs kids won't get merit based aid at the ivys? And OP basically said they were comfortable paying X amount. Why would you not at least allow the kid to explore above X?

And I say this as someone in basically OPs situation. We have a fair amount in a 529 to comfortably afford public. If my kids want to explore private with the possibility of loans we are absolutely going to let them. Admittedly if they get into a top tier public and lower tier private we may have to steer them in a particular direction, but we can't know the actual options until they've heard back.

Ivies to not give merit aid, only financial. But I just don't think loans are relevant to op's situation regardless of where her dcs go. They can pay as they go + use college savings.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Has nobody heard of student loans? It doesn't have to be all or nothing: OP can pay for the amount OP is comfortable, and OP's kids can pay the rest.

Assuming OP's kid gets into multiple schools, let the kid decide based on the various price points.

I personally don’t think anyone should take loans if there is a reasonable school they can attend without loans.

NP-I agree, as someone who started off in life with loans. Our kids are at flagship. And I also think letting kids decide is a bad idea: You can have a thoughtful, responsible child, but they cannot possibly grasp the reality of loans, expenses adults face because they just don't have the life experience or have had these responsibilities. Establishing parameters for them which are going to be optimal for you and for their future self is really important.

That being said if op cannot pay for college including private, then I am not sure who can. It's always very odd to see the many (too many to be real?) extreme multimillionaires on here tell lesser multimillionaires how poorly they are doing and how concerned they should be about x, y and z, when people like me are living a perfectly fine life on much less than op and not having to take out loans or stretch much.

+1000

This thread is full of crazy people saying that OP doesn’t have enough to retire and can’t afford beyond state school.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Has nobody heard of student loans? It doesn't have to be all or nothing: OP can pay for the amount OP is comfortable, and OP's kids can pay the rest.

Assuming OP's kid gets into multiple schools, let the kid decide based on the various price points.

I personally don’t think anyone should take loans if there is a reasonable school they can attend without loans.

NP-I agree, as someone who started off in life with loans. Our kids are at flagship. And I also think letting kids decide is a bad idea: You can have a thoughtful, responsible child, but they cannot possibly grasp the reality of loans, expenses adults face because they just don't have the life experience or have had these responsibilities. Establishing parameters for them which are going to be optimal for you and for their future self is really important.

t

I disagree. While you can certainly try to rationalize with the child and make some suggestions, it seems wild to me to completely close the door to absolute top level colleges without at least seeing the numbers. If the Delta is 400k to an absolute top flagship (ie full ride) is vastly different than say a 100k Delta to a lower tier public school. But you can't know the exact delta a priori. Personally I would have gladly taken out a medium sized loan to go to an ivy and would have begrudged my parents if they didn't even give me the option to apply.

That was you, at a time when going to an Ivy was somewhat affordable even with loans. It's vastly different now, especially with flagships having risen in rank. If you can seriously get into an Ivy, you can get into a highly ranked public with merit. But that's just if we are discussing loans. OP's child will not need loans.

How do you know OPs kids won't get merit based aid at the ivys? And OP basically said they were comfortable paying X amount. Why would you not at least allow the kid to explore above X?

And I say this as someone in basically OPs situation. We have a fair amount in a 529 to comfortably afford public. If my kids want to explore private with the possibility of loans we are absolutely going to let them. Admittedly if they get into a top tier public and lower tier private we may have to steer them in a particular direction, but we can't know the actual options until they've heard back.

Ivies to not give merit aid, only financial. But I just don't think loans are relevant to op's situation regardless of where her dcs go. They can pay as they go + use college savings.

Absolutely, no merit aid at Ivies. And why take loans when you have funds readily available?