FIL offered to pay for college... (I think?)

[Deleted]

Day's dad has done very, very well for himself. He's very much a blue collar kind of guy, who greatly values education though he never went to college (Army instead). He is kind and generous, of a little awkward socially. I pretty much adore him.

H was with his (divorced) parents last weekend for his brother's wedding. His dad, who is remarried, mentioned that he's made a deal with all of his step-grandchildren: if they toto college and graduate he will pay off their student loans. But only if they graduate.

Then FIL commented that "I can't give them the money up front because they'd blow it. But you guys are much more straightened out, so when we visit in January, I have something I need to talk to you about."

H interpreted this to mean that FIL will pay for DD's college education. H has thought his dad hinted at this for a long time, to which I always replied that until I saw it in writing and the money in our child's name, we would save/ plan to help with college. Obviously, not setting aside $300+ a month has a huge impact on our finances.

So, if FIL really is offering to pay for college, how should we go about this? I'm assuming he won't be around when she graduates from college in 23+ years (he's 64). My inclination is to set up a 529 plan and ask him to contribute there, right? Isn't $10,000 the maximum cash gift you can review annually without having to pay taxes on it? Does that count for gifts to an education fund?

What other legal/ financial things should I think about?

(I should add, I'm incredibly grateful, but skeptical. FIL definitely has the financial resources for this, but he can be a big talker who doesn't finish something. And, I'm not certain he has a firm grasp on the cost of a college education. My sister graduated in 3.5 years, and paid $87,000 IN STATE at a state school).

[Deleted]

I would save what you were planning on saving for now until you have some sort of plan worked out with him. It will be awesome if it works out but better safe than sorry IMO. A few years of savings in a 529 shouldn't drastically change your parental contribution down the line.

[niki]

I plan as if the offer was never made. Chickens, hatched, ya know.

I think if he brings it up again have a discussion about 529s. He can set it up, I believe, but he would need the child's social security number.

[MadamePresident]

Could you save money for college but not in a college specific investment fund. This way if he follows through the money you saved can be used for something else?

[Deleted]

Particularly given that he is married, I would not count on that money. I'm not saying stepmom would do anything intentional to interfere with his wishes, but so much of this depends on things you can't (and to some extent your FIL) can't control. I would keep saving.

[Deleted]

Oct 24, 2012 15:27:57 GMT -5 BirdGirl said:

Particularly given that he is married, I would not count on that money. I'm not saying stepmom would do anything intentional to interfere with his wishes, but so much of this depends on things you can't (and to some extent your FIL) can't control. I would keep saving.

This is pretty much exactly how I feel. Sooooo many things could happen to unravel this plan. Until I see the money on DD's name, I'm always going to feel like we should be saving, regardless of what FIL says.

I'm trying to think through ways to make this arrangement legally binding, so hat I don't wake up in the middle of the night thinkin we should be saving for college...

[mellymel]

Oct 24, 2012 18:47:17 GMT -5 @idaholakelady said:

Oct 24, 2012 15:27:57 GMT -5 BirdGirl said:

Particularly given that he is married, I would not count on that money. I'm not saying stepmom would do anything intentional to interfere with his wishes, but so much of this depends on things you can't (and to some extent your FIL) can't control. I would keep saving.

This is pretty much exactly how I feel. Sooooo many things could happen to unravel this plan. Until I see the money on DD's name, I'm always going to feel like we should be saving, regardless of what FIL says.

I'm trying to think through ways to make this arrangement legally binding, so hat I don't wake up in the middle of the night thinkin we should be saving for college...

I understand where you're coming from, but this kind of rubs me the wrong way. Please be careful about asking to get it in writing and make sure it's legally binding - that could be a total turnoff to your FIL. I think you should continue to save as planned, and whatever is gifted is gravy to you later.