Parents: How are you saving for your child's College Education

[BigJelly]

Originally posted by: vi_edit

Originally posted by: Zombie

Originally posted by: vi_edit

Originally posted by: Zombie
Both of our 401k's are fully funded plus company match. We are also saving enough for a rainy day but concern is saving for college and take some tax deductions as well.


What do you guys think of UGMA/UTMA ?? I don't like the idea of basically handing over a lot of money to an 18yr old to pretty much do anything he/she wants.

Careful on those. I've always been told that for college savings, it's best to keep the money in your own name. Any money entrusted in the child's name really gets hammered when it comes time for FASFA filing. The parents catch more of a break than the kids do.

True but 529 plans just don't have good returns. I don't like fees and minimal control over investments in 529.

<a target=_blank class=ftalternatingbarlinklarge href="https://personal.vanguard.com/us/accounttypes/college/ATS529LowCostInvContent.jsp">https://personal.vanguard.c......CostInvContent.jsp</a>

Vanguard has a pretty reasonable setup there. You can choose from about 19 different index based porfolios and there are only fees if you have under $3000 in the account.

It's the same thing as most people choose for their own retirement. You won't find much better returns than that unless you are an incredible stock picker/trader.

Man vanguard's 529 seems to be the best option:
529 so tax savings and good returns--lets you have more risk if you want.

 

[Brainonska511]

My parents didn't use any education specific plan, they just invested in various Vanguard index and mutual funds to save for mine and my 2 brother's undergraduate education.

 

[slag]

Originally posted by: Acanthus
My parents saved nothing, i will have enormous debt when i get out of grad school.

I will not repeat their mistake. My kids will have at least part of their education paid for by myself.

Their mistake? Son, you are over 18 years of age. Get yourself a job to pay your way. I worked 30+ hours a week at walmart plus got grants and small loans to pay my way through school plus rent, food, car insurance, books, etc.

Most people postpone grad school as well so they can afford it themselves. Expecting your parents to pay for your "further education" as well as grad school is foolish imho. You are a grown up now so why are they still paying for your decisions?

anyway, sorry to get this off topic. back to the real thread.

 

[vi edit]

Originally posted by: slag

Originally posted by: Acanthus
My parents saved nothing, i will have enormous debt when i get out of grad school.

I will not repeat their mistake. My kids will have at least part of their education paid for by myself.

Their mistake? Son, you are over 18 years of age. Get yourself a job to pay your way. I worked 30+ hours a week at walmart plus got grants and small loans to pay my way through school plus rent, food, car insurance, books, etc.

Most people postpone grad school as well so they can afford it themselves. Expecting your parents to pay for your "further education" as well as grad school is foolish imho. You are a grown up now so why are they still paying for your decisions?

anyway, sorry to get this off topic. back to the real thread.

It's just not that simple. Tuition rates doubled in many state schools in as little as 5 years time. The US government locked down on the amount of money that it was handing out and the rates that lent it out at. Degree inflation is pushing more and more people into to school and for longer.

It's just a cycle that keeps repeating itself. You take out giant loans to pay your way through. You decide your kid gets the same treatment. Except now his rates are twice as much as yours and he has to go twice as long. And then he takes the same thought as you did and now your grandkid is looking at even higher rates and possibly longer schooling.

If you can't afford your own retirement and pay for your kids college, that's fine. Pay yourself first. But if you have the money help out and lessen the load. Coming out of school with 100,000 in debt is no way to start a career if you can avoid it.

 

[Zombie]

Originally posted by: vi_edit

Originally posted by: slag

Originally posted by: Acanthus
My parents saved nothing, i will have enormous debt when i get out of grad school.

I will not repeat their mistake. My kids will have at least part of their education paid for by myself.

Their mistake? Son, you are over 18 years of age. Get yourself a job to pay your way. I worked 30+ hours a week at walmart plus got grants and small loans to pay my way through school plus rent, food, car insurance, books, etc.

Most people postpone grad school as well so they can afford it themselves. Expecting your parents to pay for your "further education" as well as grad school is foolish imho. You are a grown up now so why are they still paying for your decisions?

anyway, sorry to get this off topic. back to the real thread.

It's just not that simple. Tuition rates doubled in many state schools in as little as 5 years time. The US government locked down on the amount of money that it was handing out and the rates that lent it out at. Degree inflation is pushing more and more people into to school and for longer.

It's just a cycle that keeps repeating itself. You take out giant loans to pay your way through. You decide your kid gets the same treatment. Except now his rates are twice as much as yours and he has to go twice as long. And then he takes the same thought as you did and now your grandkid is looking at even higher rates and possibly longer schooling.

If you can't afford your own retirement and pay for your kids college, that's fine. Pay yourself first. But if you have the money help out and lessen the load. Coming out of school with 100,000 in debt is no way to start a career if you can avoid it.

agreed. If you can help out your kids there is no reason to let them graduate with debt. In fact it should be in you top 5 financial priorities.

 

[Xavier434]

Originally posted by: Zombie

Originally posted by: vi_edit

Originally posted by: slag

Originally posted by: Acanthus
My parents saved nothing, i will have enormous debt when i get out of grad school.

I will not repeat their mistake. My kids will have at least part of their education paid for by myself.

Their mistake? Son, you are over 18 years of age. Get yourself a job to pay your way. I worked 30+ hours a week at walmart plus got grants and small loans to pay my way through school plus rent, food, car insurance, books, etc.

Most people postpone grad school as well so they can afford it themselves. Expecting your parents to pay for your "further education" as well as grad school is foolish imho. You are a grown up now so why are they still paying for your decisions?

anyway, sorry to get this off topic. back to the real thread.

It's just not that simple. Tuition rates doubled in many state schools in as little as 5 years time. The US government locked down on the amount of money that it was handing out and the rates that lent it out at. Degree inflation is pushing more and more people into to school and for longer.

It's just a cycle that keeps repeating itself. You take out giant loans to pay your way through. You decide your kid gets the same treatment. Except now his rates are twice as much as yours and he has to go twice as long. And then he takes the same thought as you did and now your grandkid is looking at even higher rates and possibly longer schooling.

If you can't afford your own retirement and pay for your kids college, that's fine. Pay yourself first. But if you have the money help out and lessen the load. Coming out of school with 100,000 in debt is no way to start a career if you can avoid it.

agreed. If you can help out your kids there is no reason to let them graduate with debt. In fact it should be in you top 5 financial priorities.

I also agree here. Doing so can often be a great investment for your own retirement anyways. No matter how much money you have when you retire, you will be getting old and you will need help and you will want to have a good relationship with your kids. When your kids grow up and have kids of their own they will look back at what you did for them and grow a tremendous appreciation for it if you raised them properly.

 

[dquan97]

Putting away $20/mo (indexed w/ inflation) for each child into a 529, age-based mutual fund

 

[Kirby]

Prepaid tuition plan from the state of Alabama. I think my mom paid maybe $5k for 4 years. 😛

 

[TwiceOver]

The same way my parents did. Co-sign the FAFSA loan and they can pay for the rest of their lives.

 

[ponyo]

My 4yr old daughter currently has about $35k saved up. The money is in my name. I thought about opening one of these education accounts but I just never got around to researching it. Plus I like picking my own stocks and managing my own investments. Every year around December I deposit $5k into the account. Then I buy one stock every year. The stock had to be big cap and the one that paid dividend since I needed something stable while building equity through dividend. She currently holds Altria (big MO), Microsoft, Merck, and Costco shares. It's that time of the year again and I'm going to deposit another $5k for the final time. I'm thinking about picking up some Citigroup for her.

I don't plan on adding another dollar to this account. My plan was $25k initial investment spread over 5 years and this is the final year. She can do whatever with the money once she turns 18 but I would like for her to attend state school with local community college the first two years. Will see what happens when the time comes.

 

[mattocs]

I will do what my mom and all my friends parents did: Let the kids get loans and pay for it themselves and work part time while going to school for their spending money.

 

[spacelord]

I'm pretty sure its a 529 plan. Something our financial advisor recommended.

I don't want my kids to have loans when they get done with school. My parents helped me ALOT and I will pass it on to my kids. They will pay for all their books and beer on their own though.... just like daddy.

 

[Suspicious-Teach8788]

Originally posted by: vi_edit

Originally posted by: slag

Originally posted by: Acanthus
My parents saved nothing, i will have enormous debt when i get out of grad school.

I will not repeat their mistake. My kids will have at least part of their education paid for by myself.

Their mistake? Son, you are over 18 years of age. Get yourself a job to pay your way. I worked 30+ hours a week at walmart plus got grants and small loans to pay my way through school plus rent, food, car insurance, books, etc.

Most people postpone grad school as well so they can afford it themselves. Expecting your parents to pay for your "further education" as well as grad school is foolish imho. You are a grown up now so why are they still paying for your decisions?

anyway, sorry to get this off topic. back to the real thread.

It's just not that simple. Tuition rates doubled in many state schools in as little as 5 years time. The US government locked down on the amount of money that it was handing out and the rates that lent it out at. Degree inflation is pushing more and more people into to school and for longer.

It's just a cycle that keeps repeating itself. You take out giant loans to pay your way through. You decide your kid gets the same treatment. Except now his rates are twice as much as yours and he has to go twice as long. And then he takes the same thought as you did and now your grandkid is looking at even higher rates and possibly longer schooling.

If you can't afford your own retirement and pay for your kids college, that's fine. Pay yourself first. But if you have the money help out and lessen the load. Coming out of school with 100,000 in debt is no way to start a career if you can avoid it.

It's not that simple. Ask our entire College of Engineering who's hauling ass paying for their entire tuition working 30 hours a week. NO ONE. If you go to Cal and you ahve to pull that you're going to be dropping out of engineering. Seriously, coming out of debt sucks.

I know I'm spoiled. We Asian Americans have parents who push us so hard but the reward is that we get our whole college education paid for, and I know that I'm lucky to come out of college with no debt and knowing that I will move back home while I work.

 

[Acanthus]

Originally posted by: slag

Originally posted by: Acanthus
My parents saved nothing, i will have enormous debt when i get out of grad school.

I will not repeat their mistake. My kids will have at least part of their education paid for by myself.

Their mistake? Son, you are over 18 years of age. Get yourself a job to pay your way. I worked 30+ hours a week at walmart plus got grants and small loans to pay my way through school plus rent, food, car insurance, books, etc.

Most people postpone grad school as well so they can afford it themselves. Expecting your parents to pay for your "further education" as well as grad school is foolish imho. You are a grown up now so why are they still paying for your decisions?

anyway, sorry to get this off topic. back to the real thread.

Im an engineering student running 18 credit hours a semester.

There is absolutely no way i can work on the side as my class load alone is a 60 hour a week job.

Unless you have some magical proposal where i can make $9000 a semester working 10 hours a week.