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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]If my income was $300k I would have zero problems being able to pay for my kid to go to an expensive, private college. You need a dose of reality[/quote]
$300k puts you in a 30% combined tax bracket if you live in MD, about 27% in VA.  Don't forget, SALT deductions are limited, so you will probably take the standard deduction.

If you are 50+, you want to max out your 401k contribution and add the catch up extra $7500, which brings it to like $30K per person.

So, your income will look something like this:

1. 60K 401k (assuming both are 50+ and contributing the max, which you should at that income level)
2. taxes around $60K to $65K

That leaves you with 300K - 120k = $180k.

Let's say your annual expenses is something like $100K/yr in just expenses.   You would have $80k left.  But that just  pays for room and board.  Travel and other costs will rack up more.   That's just one kid. Many of us have more than one kid who will be in college at the same time.

You will also not have any wiggle room for large emergency expenses or even vacation. If your car breaks down (like ours just did), you'd have to get a loan at 6% to 7%.

My DC is at the state flagship with some merit aid.  We told this DC, who had super high stats, to not do ED at the expensive colleges. We cannot afford it, yes, even with $300K per year.  It would leave us with so little wiggle room, that we'd be eating hand to mouth for the next 7 years -- we have two kids, and DH is 60.  We have enough in the 529s for in state.  That would barely cover 2 years of private.

I think you are the one who needs a dose of reality.
[/quote]

NP: I personally wouldn't pay $80K for college--don't think it is worth it for 99% of colleges; however, your analysis leaves out any savings (for emergencies, etc.) and a 529 or investments/assets that could be used to pay for college. Your assumption is that the family is cashflowing the entire cost per year. I also wouldn't max out 401k for 4-5 years while 1-2 kids are in college if your 401k is already at a healthy amount.

[/quote]
Yes, I made the assumption that the PP stated they could pay for private college with $300HHI because they didn't state that.

If our 529 had $250K+, sure, but I don't think the PP has that much in their 529.

Like I said, we have enough for in state in our 529, but at $80/year with two kids, we'd still have to cash flow at least $300K.

And I disagree about not maxing out retirement.  What is a "healthy" amount in retirement ?  We aren't feds, so we have to pay for our own health insurance. I'm not planning to work until I'm 65.

You can always borrow to pay for college; can't do that for retirement.[/quote]

Again, you are making life choices.. if you will not work until 65, which is what you project you'll need to, you need to change your lifestyle or accept your kids cannot go to any school you/they want.  [/quote]
well, duh, of course it's about life choices, but the PP thought $300K was plenty to pay for $80k/year private. My point is that it's really not unless you ONLY save for college, have one child, and don't want to go on vacations (and I'm not even talking about luxury vacations), or buy a new car, or have reasonable emergency savings, or live in a good school cluster (public not private).

We don't drive expensive cars, I drive a subaru.  My spouse is from the UK, and we go see their family every couple of years.  My family lives out west, so we go see them the other years.  Family of four. Do you know how expensive that gets. I suppose I could prioritize college savings, and not see our elderly parents biannually.

yes, it's all about life choices. My kids have learned that.  My DC now in college has learned that going to an expensive school outside of T10 is not a good deal.  That spending $300K+ for four years just so you like the feel of the campus for 4 years is shortsighted.  If you take out loans for those expensive four years, you'll be paying off that loan for the next 20 years.

But, those are our opinions and our choices. [/quote]

It is about life choices.  A Subaru is a more expensive car.  And, on $300K, where is all your money going?  We could comfortably pay for a private and many other things on $300K.[/quote]
My subaru was $30k.  My old one was 14 years old and died, so that's why I had to get a new one.  The average cost of a car today is $45K.

Where does $300K go?  Do you think we don't pay taxes?  The HHI is gross, not net. We are also self employed, so we pay an extra 12% for self employment income.  And since we are self employed, we don't have employer's contributing to our 401k. We have been having to contribute both the employer and employee portion.  I'm not complaining about that.  We are able to save a good amount that way.  But, that extra is several thousands of dollars.

Do you think we all have great fed insurance? We buy our own, with a high deductible plan. We have no family money so we save a lot for retirement.  We live in a good school cluster.   Our parents live really far from us, so it costs a lot to visit them.

I just got our property tax assessment in the mail. It went up by 25%.  Home insurance is up by 40%.   We are in our 50s so we have even more health issues now, and as we get older, health insurance gets even more expensive.

Are you a fed?  I feel like you feds live in a bubble.

I'm not complaining about my life. We have a great life. We have enough saved for in state tuition.  My kid got merit aid, too.

Point being: $300K seems like a lot, and it is, but it's still not that easy to pay for $80k/year per child for college and live a good but not luxury lifestyle.  And yea, I'm not willing to sacrifice vacation or a $30K car, which my kid will be getting when they graduate, to pay for $80k/year per child for college.

Life choices.[/quote]

Oh, good grief. We are pretty much all the things you are (in 50s, crazy high property tax area, w/ family in Europe, had to buy a car) on half your salary. We've been saving since our kids were little and could pay 50-55k/year with some loans. I don't understand how you say you can't afford full fare. Fine if you don't want to, and it may not be easy, but you could do it with planning/saving. As I said earlier, the real problem is that people aren't convinced to save early enough.[/quote]

Instead of criticizing, please share specifics on how you saved up enough for $55k per year per kid on a $150 HHI.  That is a pretty significant achievement. [/quote]

Not that poster but we've done it too.  It's all about lifestyle choices.  Your home, your cars, your clothing, your food, your activities (though this is our biggest expense as ours are in pricy activities).   We live in our "starter" home.  We aren't vacationing regularly.  We are shopping at lower cost food and other stores.  Our kids aren't getting designer anything, nor are we except on clearance or a good.  We started at birth.  There were so many things we needed with our house and other things, but we learned to DIY many things and we put a huge focus to the college savings.  So, the poster saying they need their vacations, to us that is a want, and we aren't taking one or a very cheap one or every few years and that money goes into the college fund.  Need a new kitchen, DIY almost everything... same with most other things except big things like the roof or siding.  So, the $5K you are paying someone to paint your house, we are doing it ourselves and that money goes into the college fund.[/quote]
I am the poster the PP was responding and forgot about diy. Thanks for including that. We do basic plumbing and electrical, all landscaping, painting, etc ourselves.  [/quote]

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