Of course this is a possibility, but I think it boils down to statistics. It doesn't make sense to structure your financial plan and investments around the outliers. I mean, you could win the lottery and not need to do any retirement savings at all.
I think it's safe to generally plan on your specific child going to college, and safe to generally plan for a world in which your child will not be an international superstar to the degree that post-secondary education is not applicable.
You are very serious.
I knew you were joking about being a pop star!
My point was just that of course there is a small possibility that she might not go to college, but I don't think the possibility is large enough to avoid the advantages of 529 investments.
Well, I would make an exception if my child were a huge pop star or something crazy like that. LOL.
Of course this is a possibility, but I think it boils down to statistics. It doesn't make sense to structure your financial plan and investments around the outliers. I mean, you could win the lottery and not need to do any retirement savings at all.
I think it's safe to generally plan on your specific child going to college, and safe to generally plan for a world in which your child will not be an international superstar to the degree that post-secondary education is not applicable.
Shit. I wish I'd read your follow up sooner. When I saw miso's post about not making her kid go to college if she becomes an international pop star, I immediately drained both of my kids' 529s and spent it all on hookers and blow.
Post by rageragerage on Oct 5, 2015 16:20:45 GMT -5
Heyyy, adoption through foster care FTW with free in-state tuition. We are going to start getting him excited about being a Texas Longhorn now, so in 15 years he will be stoked about going to a state school. If he wants to go out of state, then we will help however we can.
We have the Canadian equivalent (RESP), fully funded by FIL, he does it for all the grand kids.
Not going to college is not an option in our family. :::hides:::
And if one of them ends up having an LD and college isn't a good option for them? My dad pulled that shit on my oldest brother and it made him miserable he failed out and felt horrible. My mom talked him into going to trade school and now he is the most financially successful of all us kids (we have college degrees).
Oh we only put like $50 a month in each right now. But I feel like it is better than nothing. Once daycare is done and we are done with H's grad loans I hope we can put more in per month.
I don't think we will be able to pay the full cost of college if prices stay the same. But when I worked in financial aid I felt sorry for the kids whose parents didn't pay anything, and left their kids with huge costs. I also felt bad for the families who seemed to make good $$$ but couldn't even pay the balance of a couple thousand dollars each year. I vowed to not be either of those parents.
We have the Canadian equivalent (RESP), fully funded by FIL, he does it for all the grand kids.
Not going to college is not an option in our family. :::hides:::
And if one of them ends up having an LD and college isn't a good option for them? My dad pulled that shit on my oldest brother and it made him miserable he failed out and felt horrible. My mom talked him into going to trade school and now he is the most financially successful of all us kids (we have college degrees).
I believe 529 funds CB be used for trade schools too...
We have one for DD. It's small right now, but growing slowly. My parents paid for undergrad, I paid for grad school. Once we pay off my grad school loans the 529 contribution will increase.
I have too many friends trapped in jobs they hate because of the loan forgiveness program. If I can help reduce DD's needs for loans, I will.
And if one of them ends up having an LD and college isn't a good option for them? My dad pulled that shit on my oldest brother and it made him miserable he failed out and felt horrible. My mom talked him into going to trade school and now he is the most financially successful of all us kids (we have college degrees).
I believe 529 funds CB be used for trade schools too...
We have one for DD. It's small right now, but growing slowly. My parents paid for undergrad, I paid for grad school. Once we pay off my grad school loans the 529 contribution will increase.
I have too many friends trapped in jobs they hate because of the loan forgiveness program. If I can help reduce DD's needs for loans, I will.
I know I was referencing the kids 'have to go to college' part.
Post by MixedBerryJam on Oct 5, 2015 17:09:11 GMT -5
We do not have 529s for our kids. My husband was pretty adamant about it. It was never about "What if they don't go to college" (and, btw, if they don't the money can be used for education of any other family member, or passed down to another generation's family member, even; and can be used for trade school and ce credits, too, I'm pretty sure). I think between the impact the funds in the 529 would have on potential needs-based financial aid and the fact that my husband had great confidence in his investment acumen, he wanted to control this savings plan himself.
I believe that young people should participate in paying for their own higher education. Disagree all you want, but I stand on that principle. This does not make me an asshole.
I fully realize that people will continue to pay for full rides for their kids. Go ahead with that if it is what you want to do. I disagree that it is good for the child. That's all.
See, I think you can disagree that it is good for *your* child, but I don't think you can speak for all the children of all the people in the world.
If I have more than one kid maybe. I am concerned about having so much money that can only be used for college and I can't imagine really being able to afford donating a to a niece or nephew.
I save/will save via other methods at this point. Maybe I'll put some in a 529.
My husband and his brother were both bright, good students, with college educated parents and neither of them went to college past a semester or two which may make me a little gun shy.
Anyway, if my son goes to college, I would like to pay the largest part of his expenses.
We have the Canadian equivalent (RESP), fully funded by FIL, he does it for all the grand kids.
Not going to college is not an option in our family. :::hides:::
And if one of them ends up having an LD and college isn't a good option for them? My dad pulled that shit on my oldest brother and it made him miserable he failed out and felt horrible. My mom talked him into going to trade school and now he is the most financially successful of all us kids (we have college degrees).
Well obviously I am not a complete asshole. We would reconsider our stance if one of our kids had a LD.
Eta: and I have a brother too. The reason he didn't go to college was that he was too lazy. My parents have him an out to take over the family restaurant instead. Yeah guess what? He was obviously too lazy for that too. Except he only told them that 20 years later and now they are fucked. Random family story time and all...
Yes. I loved college and would love DD to go and love it, too. Being free to pick a college with some/all college savings is practical and may give her many options. And I think a 529 plan is a good college savings plan.
I also desperately wish the money goes to a great degree that propels her into a great career. Because it takes a boatload of money to save for a degree - I HOPE it's worth it. Wouldn't THAT be nice?
If she chooses a career that doesn't require a degree, I still want her to have an opportunity to take whatever college classes she wants, for the joy of learning. I still think that's worth a saving plan.
And I think that life is long, so even if she doesn't exactly know what school or degree to pick ... a savings account will give her choices. Choices I want her to have.
Heyyy, adoption through foster care FTW with free in-state tuition. We are going to start getting him excited about being a Texas Longhorn now, so in 15 years he will be stoked about going to a state school. If he wants to go out of state, then we will help however we can.
I am lucky to be in the same position, assuming that the state does not cancel the program before he graduates (in 2028). I figure the money we save can be used for housing, books, and extra fees, and any extra can carry over to grad school if needed. And if Texas cuts this program like they have so many others, at least I will have something saved, though we probably won't be able to pay for everything.
I don't really know what they are exactly, but I know each child has a college fund, both of which were started with their adoption tax credits. We plan to fund at least their tuition, if not give them a full ride. And I would encourage both of them to live at home rent free after college to pay off any loans they may need. I want to give my children as easy a start as possible into adulthood. Student loans suck.
I don't really know what they are exactly, but I know each child has a college fund, both of which were started with their adoption tax credits. We plan to fund at least their tuition, if not give them a full ride. And I would encourage both of them to live at home rent free after college to pay off any loans they may need. I want to give my children as easy a start as possible into adulthood. Student loans suck.
I was with you right up until the "live at home rent free after college." Nope. I've already decided that my kids will graduate college with zero debt. Which means they'll be well positioned to fully launch. No basement dwellers at my house, tyvm!
My financial advisor thought we should do a custodial account instead of a 529. That's what we have set up for now, but after some things I've read on MM I'm wondering if a 529 isn't the better option.
In talking with my financial advisor, I decided to open an UGMA acct for now instead of a 529, mainly for the flexibility, both from an investment and usage perspective. We'll have to figure out what to do about it before he turns 18, but we can always transfer a portion or all of it to a 529 later on.
We have one of these for each of my kids as well. Pros and Cons to it but we liked the flexibility better. It is technically a trust in the kid's name so it can affect the financial aid they can receive because the child's money is weighted more than parent's in the financial aid formula (loans as well) but I want them to use this money before they take loans anyways so we went with this plan.
We will open a savings account for each child, but not a 529. I got an academic scholarship for college and my parents were able to pay for the rest of the tuition and room/board. I worked to pay for books and fun stuff. I paid for grad school myself while working full time and living with my parents.
It's scary to me to think of where college tuition will be in 18 years. I went to a tiny Catholic college, and their tuition has gone up by about 60% since I graduated 10 years ago. It's insane!
I don't really know what they are exactly, but I know each child has a college fund, both of which were started with their adoption tax credits. We plan to fund at least their tuition, if not give them a full ride. And I would encourage both of them to live at home rent free after college to pay off any loans they may need. I want to give my children as easy a start as possible into adulthood. Student loans suck.
I was with you right up until the "live at home rent free after college." Nope. I've already decided that my kids will graduate college with zero debt. Which means they'll be well positioned to fully launch. No basement dwellers at my house, tyvm!
That's only if they have to take out loans, and would only be for a short time with the stipulation that they have full time jobs, are paying off as much of their loans as possible every month, and saving for a house/condo/whatever. H did that and paid off the student loans for his undergrad and graduate degrees within two years and had a hefty downpayment on his townhouse.
We have money stashed away for them in investments accounts and I am super close to opening 529s for them because I also fully expect they will all go to college, but then once I'm about to pull the trigger, I chicken out for some reason. "529s" is always at the top of my to-do list, but I'm really not sure why I have such hesitation.
We have just a savings account as of right now. I know we should do something else with it but the 529 plan does make me nervous. What if he wants to go to a trade school? My BIL who is in finance said it doesn't apply.
Post by onomatopoeia on Oct 6, 2015 15:27:09 GMT -5
Yes, for both kids. We don't expect to be able to pay for the whole ride, but want to help as much as we can. I paid/borrowed for my entire college education and student loans suck. They put me at such a disadvantage. I mean, I certainly came out okay, but if I can help my kids avoid that why wouldn't I?
We briefly considered other savings options, but 529's are what our financial advisor suggested.
We'll let them stay in our basement after they graduate too!
Yes. But our FP advised us in only to save about half of our college money in there in case one kid doesn't go, gets a scholarship, etc. if they both get scholarships it can still be used for graduate school. The rest of our money is in a regular, taxable account in our names (but separate from out general fund) to allow for maximum flexibility in the future.
I was with you right up until the "live at home rent free after college." Nope. I've already decided that my kids will graduate college with zero debt. Which means they'll be well positioned to fully launch. No basement dwellers at my house, tyvm!
That's only if they have to take out loans, and would only be for a short time with the stipulation that they have full time jobs, are paying off as much of their loans as possible every month, and saving for a house/condo/whatever. H did that and paid off the student loans for his undergrad and graduate degrees within two years and had a hefty downpayment on his townhouse.
My parents let me do something similar. I lived at home rent and expense free after law school, as long as I promised to pay 2x my minimum payments for my loans. That really helped me make a significant dent in my debt and my loan will be paid off so much earlier than it otherwise would've been. I'm grateful they pushed me to do that.
I have 529s for both kids. My parents paid for my education and I hope to do the same. My parents and my ILs give a gift to the 529 for the boys' birthdays each year. My oldest is 9 and when he got the check for college from my ILs (his step-grandparents) this year for his 9th birthday he was so excited. The kid has decided that money for college is way better than more toys.
Working at a college, I know that financial hardship is a number one reason for attrition. I see kids struggle with this every day. And as much as they work and try to pay their own way, they can't always do it. I want to do everything I can to not put my kids in that situation.