Reply to Did you folks not do ANY saving?

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]Notice how this post was not answered, nor are any of the other people complaining about "the lucky poors who get financial aid".[/quote]
I have $300k saved across 529 and other nonretirement assets.  Based on the 5% formula, this would increase my EFC by $15k per year, so I would be paying $60k more than if I hadn't saved.[/quote]

Thanks for answering, and congrats for being a diligent and responsible parent.

I do not know if you were one of the previous posters, but are you saying you’d be better off with $60K more of financial aid and no savings  to pay for college?  Probably not, right?
[/quote]
I think there's an arithmetic mistake. If a child were to attend a $65k/year college, then in Year 1 the added cost is $15k. In year 2, however, the penalty goes down to $11.75k since $65k will be spent. Year 3 is $8.5k, and year 4 is $5.25k, for a total penalty of "only" $40.5k.

Is this better than not having saved?  That depends on where the money is coming from you'll use to pay. You'll have to look at loan options, calculate the amount you need to borrow, terms of the loan, and then adjust for inflation.  At today's rate, you can borrow a fair amount for $40.5k in interest. [/quote]

Yes I thought of that but was too lazy to do the math.  Thanks!  My main point, which I think is even more valid after your adjustment, is that nearly everyone would be way worse off if they had not saved.

It's kinda like saying you want to make less money so your top marginal rate is less.  It makes no sense, but is often claimed by people.[/quote]

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