Author Topic: How much do you put away for college each month?  (Read 17799 times)

texastumbleweed

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How much do you put away for college each month?
« on: December 30, 2016, 01:06:31 PM »
Subject says it all: how much money do you put aside for each child each month?  Mine are still little, but I know there is no time like the present. 

radram

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Re: How much do you put away for college each month?
« Reply #1 on: December 30, 2016, 01:48:55 PM »
Subject says it all: how much money do you put aside for each child each month?  Mine are still little, but I know there is no time like the present.
In WI, we can reduce our income by $3000 per child. Since that is the only tax advantage, that is what we put in.  We do not "save" monthly, we just write 1 check per year to our state program (EdVest). We srtarted when they were 0 years old.

It definitely adds up. The 17 year old has $94,000, and the 19 year old has $65,000. I just moved the 17 year old to guaranteed, since she will use it all withing the next 5 years. 10 year old in 100% stocks.

Congrats on getting started.

Abe

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Re: How much do you put away for college each month?
« Reply #2 on: December 30, 2016, 02:13:06 PM »
We have one 6 month old. We're planning on $5k/yr. With compound interest around 4%, that should come to $120k to cover room/board for 4 years at a reasonable college. Grad school we will probably cover separately when the time comes.

Sonos

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Re: How much do you put away for college each month?
« Reply #3 on: December 30, 2016, 02:36:10 PM »
We live in a HCOL area. Our plan is to be FI in about 10 years. By the time our kids are in college (about 8 years later), we'll just have a few years left on our mortgage. Once the mortgage is done, we can use the money that used to go to our mortgage to either pay for college or to pay off newly acquired student loans. I like the flexibility this gives us in how to use the money, because we have no idea what the educational landscape will be like by then. Even if it's just the same as it is now, our kiddo might choose some kind of other path.

little_brown_dog

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Re: How much do you put away for college each month?
« Reply #4 on: December 30, 2016, 02:40:25 PM »
One 1yr old toddler and will hopefully have 2 more kiddos. We plan on dedicating 5k per year per child for 17yrs each.

gaja

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Re: How much do you put away for college each month?
« Reply #5 on: December 30, 2016, 03:08:45 PM »
There is no tuition cost in the Nordic countries, and I will be surprised if that changes within the next 10 years. We do save $100/month for each child to cover some living costs and potential increased costs of studying a year or two abroad. The state scholarship is currently $5500/year to cover living costs and books if they move out from home, and an additional $6000/year to cover part of the tuition costs if they study abroad. Student loans are interest free until they finish school, so we might encourage them to take out the loans, and then help them pay them back before the interest starts running. But we also expect them to work part time, if they are at all able to. If not, they'll have to apply for more scholarships.

starbuck

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Re: How much do you put away for college each month?
« Reply #6 on: December 31, 2016, 09:32:17 AM »
We have a 1 year old with plans for at least one more child, maybe even a third. We don't get any state tax incentives for 529s, so we just put $100/month into Vanguard's 529 plan, plus whatever family members choose to contribute. Once we have a 2nd kid, it'll probably go up to $200/month.

We could put in much more but I don't plan on the 529 account covering all of their college costs for several reasons. While both me and my husband got 4 year degrees, but maybe our kid wants to go to a trade school or into the military. In two decades the cost and structure of college could be very very different. And I'm on board with sharing the cost of a 4 year college with my children, rather than covering it 100%. I paid for all of my college education, and my husband paid for none of his, so this is something we're compromising on.

Acorns

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Re: How much do you put away for college each month?
« Reply #7 on: December 31, 2016, 12:05:38 PM »
We have 3 kids under 5 and we put $450/mo into a 529, plus whatever they get for birthdays from family. That probably won't be enough to cover college expenses for all of them, but we also have some rental property which we hope to be making a profit from by the time they go to college and we plan on using that profit to offset their college costs.

texastumbleweed

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Re: How much do you put away for college each month?
« Reply #8 on: January 01, 2017, 06:11:04 PM »
is that $450 a month for each kid or total?  $450 seems like a lot to me per kid but maybe it isn't?

moof

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Re: How much do you put away for college each month?
« Reply #9 on: January 01, 2017, 08:10:35 PM »
We are maxing out the state deduction, so $385/month.  He will have about $50k of total contributions when we pull the trigger in 8 years, and another 6 years of growth, so hopefully $80-100k to cover college.  Might cover a year at the current rate of tuition increases.

mr_orange

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Re: How much do you put away for college each month?
« Reply #10 on: January 01, 2017, 08:19:50 PM »
We're doing $700/month/kid right now, but I plan to reduce our contributions once a FV calculation at 8%ish growth shows we'll hit $100k/kid when they're college age.  I'll probably throttle things back to $200/kid/month at that point and invest the difference in other areas. 

JustTrying

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Re: How much do you put away for college each month?
« Reply #11 on: January 02, 2017, 03:41:32 PM »
$150 per month, starting the month she was born. I'm not trying to pay for everything with this, I just want to help her some.

Acorns

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Re: How much do you put away for college each month?
« Reply #12 on: January 02, 2017, 09:38:21 PM »
is that $450 a month for each kid or total?  $450 seems like a lot to me per kid but maybe it isn't?

It is $450 total, we just have one 529 that will get split between them to fund college. It would be nice to save more using another vehicle, maybe a UTMA, but right now that's all we can afford.

mxt0133

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Re: How much do you put away for college each month?
« Reply #13 on: January 02, 2017, 10:40:29 PM »
We have three kids 6, 4 and 2 and we are putting in ZERO.  My priority is to ensure that our retirement is covered and we will not be dependent on our children as we age.  We also prioritized having one SAHP and have decided to homeschool them.  The plan is to expose them to as much as we can at an early age so they have a good idea what they want to do in terms of career/job and how to be self sufficient once they turn 18 or earlier.

If it seems like they will be going the college route then we will structure our income to minimize it so that we minimize the expected family contribution (EFC), if we are not FIRE yet.  We will also guide them to earn as many college credits before they even go via AP classes or CLEP.  Have them apply for as many scholarships and work study as possible and if it is still not fully covered then we might cash flow some of it with full-time or part-time work between the wife and I.

Just like retirement we do not plan to follow the standard plan of saving and paying full price for their college education if they want to go that route.




little_brown_dog

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Re: How much do you put away for college each month?
« Reply #14 on: January 03, 2017, 10:18:30 AM »
is that $450 a month for each kid or total?  $450 seems like a lot to me per kid but maybe it isn't?

The thing I try to keep in mind when talking about college funds is that every person’s situation is unique, so don’t get freaked out if some of the investment amounts you see here seem really big to you (or really small). The ideal amount to contribute for your kid is entirely dependent on your own income level, financial goals, retirement savings rate, and personal values regarding how much help you think is necessary/practical/appropriate for college. For us, a 5k/yr investment is not much due to our high income and the fact that we save >7x that for our own retirement/financial goals, but it wasn’t always this way. A few years ago we were making far less and were saddled with massive student debt, so we knew that we wouldn't even consider setting up college funds until the loans were gone and we had achieved the ability to max our retirement accounts first. Similarly, we may find that in a few years my husband wants to cut back or change gears in his stressful career, and we might re-evaluate and downshift our college contributions accordingly.

We came to our current investment amount by weighing our desire to offer substantial help (not necessarily a full ride) with our own personal goals, and decided that 5k/yr/child would be very generous but would not negatively impact or derail the larger finances of our family. If we had to choose between maxing our retirement accounts and putting this amount towards college, we would have chosen to put less towards college. My personal advice is to pick an amount you can comfortably afford month after month (or year after year), feel good about it, and just let the chips fall where they may. Following this “set it and forget it” strategy regarding the amount is far less stressful to me than trying to anticipate what college expenses will be 17yrs from now and back calculating how much I need to save to pay for X percent of that cost. If it is enough to cover everything at a reasonable university, awesome! If not, there are loans and scholarships. Easy peasy.

Stachetastic

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Re: How much do you put away for college each month?
« Reply #15 on: January 03, 2017, 10:31:37 AM »
We put $25/week per child in a standard savings account for each of our two children, 8 and 4 years old. Our oldest has another parent who may or may not be contributing, as well. Our intent is to help them when the time comes, but paying the whole thing is not something we're striving for. We both earn less than 40k and are not yet maxing retirement accounts. We have a branch of our largest state university within walking distance of our home, and they are welcome to live at home as long as they are in school. We also own a couple of rentals, so the income from those will be used toward education as well, if need be. We will also be encouraging them to explore 2 year degrees, trades, etc. depending on their interests.

scienceplayhouse

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Re: How much do you put away for college each month?
« Reply #16 on: January 10, 2017, 12:46:59 PM »
We retired with 3 kids under 10 so future college expenses is a big deal. We are going a little non-traditional in our saving approach. We bought a rental house, mortgaged over 15 years, and the rent pays the majority of the PITI. We probably kick in an extra $50 a month or so to make up the difference.

At this point, the house will be paid off by the time the oldest starts college so we can either sell the house which should pay for state schooling for all three, or use the rental income to offset the costs of college, then keep the rental income for our own use in the future.

NeonPegasus

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Re: How much do you put away for college each month?
« Reply #17 on: January 12, 2017, 10:17:44 AM »
We could put in much more but I don't plan on the 529 account covering all of their college costs for several reasons. While both me and my husband got 4 year degrees, but maybe our kid wants to go to a trade school or into the military. In two decades the cost and structure of college could be very very different. And I'm on board with sharing the cost of a 4 year college with my children, rather than covering it 100%. I paid for all of my college education, and my husband paid for none of his, so this is something we're compromising on.

FYI - the GA 529 can be used for vocational schools. Your other points are very valid.

I'm struggling with deciding how much to contribute but that's probably a discussion for another thread.


MayDay

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Re: How much do you put away for college each month?
« Reply #18 on: January 13, 2017, 07:38:16 AM »
None.

My grandfather is saving enough for about one year of school per kid.

Well cash flow the rest. Our retirement will be pretty close to funded when they start college, so we can divert that savings to college of we deem it appropriate.

We do put any cash gifts the kids get onto their 529's, and our 2% CC rewards go into those accounts as well. But that will cover like a semester of books.

State schools are not *that* expensive. It'll be no problem to cash flow it. We won't be finding expensive private school or grad school.

Helvegen

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Re: How much do you put away for college each month?
« Reply #19 on: January 23, 2017, 09:21:28 AM »
None. I don't think the ROI is there anymore. My husband makes way more than I do with just an AS he got for free.

Basically, I will have her do dual enrollment/AP in high school and we'll pay for a vocational associates degree through a local community college.

If she wants to go to a four year, she needs to figure out how to pay for that herself or go back to Germany.

SomedayStache

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Re: How much do you put away for college each month?
« Reply #20 on: January 23, 2017, 09:49:22 AM »
3 kiddos, ages 8,5,3.

We have very small 529 accounts opened for the older two.  Once I dove head first into the personal finance world I stopped those contributions.

Currently saving zero for college.

-I am now prioritizing my own retirement savings.
-My husband is a stay at home parent, he may start working again at some point.  Maybe we'll up college savings then, maybe not.  Maybe he'll work while they are in college and we'll funnel his paycheck to cover tuition bills?  Lots of options.
-Neither me nor my husband needed college savings.  I got scholarships, he (wisely) dropped out of college because it wasn't the right path for him.
-I see the rising college costs and how everyone is saddled with monumental student loan debt and I think that it is entirely possible that the whole system will go through some major upheaval before my kids are college age.

SEAK

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Re: How much do you put away for college each month?
« Reply #21 on: January 23, 2017, 11:13:18 AM »
Two wonderful kiddos aged 9 and 7. Since they were born we've been putting in $100/month each plus their Alaska Permanent Fund Dividend (which has ranged from $1,000 to $2,000/year). I'm contemplating upping that amount to $150/month so they both will have about $100k saved for college. Saving this amount won't cover all of their college expenses, but both kids are members of a Indian Tribe which historically has given out pretty good scholarships.

frugalfinancehippy

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Re: How much do you put away for college each month?
« Reply #22 on: January 25, 2017, 09:56:51 PM »
Currently $200 a month into an RESP in Canada which adds 20% grant (about another $40 a month)


Retireme32

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Re: How much do you put away for college each month?
« Reply #23 on: January 26, 2017, 05:30:41 AM »
We have one 6 month old. We're planning on $5k/yr. With compound interest around 4%, that should come to $120k to cover room/board for 4 years at a reasonable college. Grad school we will probably cover separately when the time comes.

I was just wondering, what was the average rate of return you saw over those 17 years using EdVest?

davisgang90

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Re: How much do you put away for college each month?
« Reply #24 on: January 26, 2017, 05:51:23 AM »
Zero.  I have one left for college and I can pass my GI Bill benefits to him to cover a 4 year degree.  He's on his own after that.

Pigeon

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Re: How much do you put away for college each month?
« Reply #25 on: January 26, 2017, 06:25:30 AM »
I have two kids and currently save $416 per kid per month in a 529.  In addition, we save a similar amount per kid per month in a regular account.  Our kids are older (one actually in college now and one a junior in high school).  We saved a lesser amount when they were younger, although I wish we had saved more then and less now.  We pay room, board and tuition at a state college/university.

MBot

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Re: How much do you put away for college each month?
« Reply #26 on: January 26, 2017, 08:19:52 PM »
Enough to max out the matching on our Registered Education Savings Plan (we're in Ontario, Canada). About $210 a month (that's our contribution monthly, with extras periodically from relatives etc).

It takes most of his (tax-free) Child Care benefit to contribute this amount, and I think it's enough to give him a good start without paying for absolutely everything.

steviesterno

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Re: How much do you put away for college each month?
« Reply #27 on: January 28, 2017, 04:35:52 AM »
I started a 529 when my kiddo was 3 months old. we're putting about $100 a month in after the initial $3k to start it, but  the grandparents enos contributing for gifts. Even though we're in an income-tax free state, not sure that will always be the case. Plus my thought is if it's not needed (because he doesn't go to school) the 10% penalty is still worth it rather than coming up with it at the time.

I work at a university, so if he choses to he can go there for free (as long as I'm still there). But since you can transfer it to a family member, if he ends up not needing it I can transfer it to my wife and I, and we can take continuing ed courses on cruise ships or study abroad with the money.

My dad worked at a university, and the options were any state school in the system, plus they paid rent and some bills for 4 years. Anything I wanted outside that I had to pay for, and all graduate school was on me. I know what it's like starting a life with $150k debt over my head, but I have classmates that didn't get help with undergrad so they're at $300k+. I want to help my kid but certainly not pay for it all.

I don't honestly think college will be in 20 years what it is now. THere's no reason you can't get 2 years done online or at a local CC and then go somewhere else for the "college experience". I wouldn't be surprised if technology and money saving policies completely change education before my kiddo gets there.

boarder42

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Re: How much do you put away for college each month?
« Reply #28 on: January 28, 2017, 05:18:43 AM »
Stevie. Why are you doing 529 then. It will be 19 years before our kids reach college. And I agree the landscape will likely be flipped on its head. I think a change in everyone going could change too

Mezzie

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Re: How much do you put away for college each month?
« Reply #29 on: January 28, 2017, 10:37:06 AM »
I'm speaking as an aunt, not a parent here, and I'd love your input.

At first, I thought of contributing to 529s for the nieces and nephews, but then I came up with what I think is a better idea.

In my town, you can get the first year at community college free. I think most of them will take that route. If they do, they're likely to transfer to a state college. They should get scholarships (I'm in education, so I'll be sending them essay contest information constantly), but they'll likely have more to pay, and it's unlikely their parents can foot most or all of the bill. So I was thinking... if I hear they're taking out loans, I could offer them a 0% loan from me instead using my fun investment account money (my little account that's doing pretty well right now but is fairly high risk; I keep it around since the bulk of my investing is boring). That's fun money I'm not including in my retirement plans anyway; if it disappears, we're good. If it does well, we get a nice vacation... or a niece/nephew gets a 0% loan. As far as payment schedules, I think it would be fair to have a "pay off X amount by the time your little sister/cousin needs a similar loan" type goal. I'm not planning to foot the entire bill for anyone, but a 0% loan of any amount could prove very useful.

Such a loan would also be a great opportunity for us to have a chat about finances, saving, investing, avoiding credit card debt, etc., which could hopefully help them make some decent financial choices early on.

What do you think?

Hadilly

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Re: How much do you put away for college each month?
« Reply #30 on: January 28, 2017, 12:33:44 PM »
Three kids, 6, 8, and 10. We have some employer coverage for college, but figured out that that we need to save 43k a year for the next 15 years to fully cover Ivy League costs for everyone. Number arrived based on a big excel spreadsheet.

We are only putting a little bit in 529s, enough to cover projected costs at state school. So even though it sounds like a huge amount to put away, it's really more an enforced savings mechanism and we will be able to use the money for other things should we need/want to do so.

Also, my spouse has no desire to retire early, so we are also funding for a more conventional retirement age.

Secretly Saving

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Re: How much do you put away for college each month?
« Reply #31 on: January 28, 2017, 01:18:23 PM »
We have about $60k for each kid now and are saving up to the state deduction each year.  We have another 10 years before college will start.

VeggieTable

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Re: How much do you put away for college each month?
« Reply #32 on: January 28, 2017, 02:56:15 PM »
One kid, age 2.5. We opened up a 529 last year and put $7000 in it from money we'd saved before he was born and cash gifts we received. Since then we've been doing $100/month. Kid also has a brokerage account opened by DH's grandmother, which she put $10,000 into.

radram

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Re: How much do you put away for college each month?
« Reply #33 on: January 28, 2017, 04:48:41 PM »
I'm speaking as an aunt, not a parent here, and I'd love your input.

At first, I thought of contributing to 529s for the nieces and nephews, but then I came up with what I think is a better idea.

In my town, you can get the first year at community college free. I think most of them will take that route. If they do, they're likely to transfer to a state college. They should get scholarships (I'm in education, so I'll be sending them essay contest information constantly), but they'll likely have more to pay, and it's unlikely their parents can foot most or all of the bill. So I was thinking... if I hear they're taking out loans, I could offer them a 0% loan from me instead using my fun investment account money (my little account that's doing pretty well right now but is fairly high risk; I keep it around since the bulk of my investing is boring). That's fun money I'm not including in my retirement plans anyway; if it disappears, we're good. If it does well, we get a nice vacation... or a niece/nephew gets a 0% loan. As far as payment schedules, I think it would be fair to have a "pay off X amount by the time your little sister/cousin needs a similar loan" type goal. I'm not planning to foot the entire bill for anyone, but a 0% loan of any amount could prove very useful.

Such a loan would also be a great opportunity for us to have a chat about finances, saving, investing, avoiding credit card debt, etc., which could hopefully help them make some decent financial choices early on.

What do you think?

I think a loan to a friend or family member can lead to hurt feeling, unless you are comfortable with it never being paid back. When they are driving by in a new car someday, maybe even a decade or more from now, will you be ok with that while they have an outstanding loan with you? What about a nice trip, a new sweater, some fancy new shoes?  If you can not say you would not at all be bothered,I would not offer a loan under any terms.

A gift is a very nice gesture. I think you could reasonably state that this gift, while not due to be paid back to YOU, should be paid back in the form of them paying it forward to help someone else, maybe even after you are long gone.


Mezzie

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Re: How much do you put away for college each month?
« Reply #34 on: January 28, 2017, 07:29:10 PM »
Oh, yeah -- I learned not to expect loan repayments a long time ago, so I wouldn't hound. But if I didn't get paid back and the kid was buying a new car and such meanwhile, that would simply be the last such loan to that kid. Like I said, it wouldn't be an amount I couldn't live without.

Vindicated

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Re: How much do you put away for college each month?
« Reply #35 on: January 31, 2017, 07:07:06 AM »
We have a newly 2yo, and have only a couple hundred dollars saved so far in a 529.  My wife's Grandfather left a bit in a trust fund for him, but it's only around $5k.

My wife and I both think it's more important to pay off our debts first.  Once we're debt free, we'll focus on our own retirement savings, but up contributions small amounts to his 529, depending what's comfortable.  I'm fine with him making his own path, as long as his mother and I are stable and able to support in some way.

The key is, we have no idea what college will look like in 16 years.  It may be free.  It may be the same.  Who knows?  What we do know for sure is that we'll want to retire, and if we successfully save enough to retire while he's college age, we'll at least set a good example for personal financial responsibility.

Guesl982374

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Re: How much do you put away for college each month?
« Reply #36 on: February 01, 2017, 07:43:47 AM »
Specifically for college? none. With that being said, we plan on building a biggest enough 'stach that we'll be able to pay for $200K (future dollars) for each after we reach FI. I am hesitant to lock up money in a 529 in case they don't go to college or in case we 'over save' and end up paying close to full cost vs. getting a break on tuition since it seems most people don't pay full price. I would rather the flexibility and potential cost savings vs. the tax savings.

radram

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Re: How much do you put away for college each month?
« Reply #37 on: February 01, 2017, 08:09:29 AM »
Specifically for college? none. With that being said, we plan on building a biggest enough 'stach that we'll be able to pay for $200K (future dollars) for each after we reach FI. I am hesitant to lock up money in a 529 in case they don't go to college or in case we 'over save' and end up paying close to full cost vs. getting a break on tuition since it seems most people don't pay full price. I would rather the flexibility and potential cost savings vs. the tax savings.

There are rules that allow you to withdraw equivalent amounts of scholarship money. The 10% penalty is waived. It is considered income to the student for that year. The 529 is also transferable to others. That said, your situation might show you are doing everything right to maximize your finances.

teamzissou00

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Re: How much do you put away for college each month?
« Reply #38 on: February 01, 2017, 01:54:13 PM »
Specifically for college? none. With that being said, we plan on building a biggest enough 'stach that we'll be able to pay for $200K (future dollars) for each after we reach FI. I am hesitant to lock up money in a 529 in case they don't go to college or in case we 'over save' and end up paying close to full cost vs. getting a break on tuition since it seems most people don't pay full price. I would rather the flexibility and potential cost savings vs. the tax savings.

This is my plan as well. 

boarder42

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Re: How much do you put away for college each month?
« Reply #39 on: February 01, 2017, 02:45:54 PM »
Specifically for college? none. With that being said, we plan on building a biggest enough 'stach that we'll be able to pay for $200K (future dollars) for each after we reach FI. I am hesitant to lock up money in a 529 in case they don't go to college or in case we 'over save' and end up paying close to full cost vs. getting a break on tuition since it seems most people don't pay full price. I would rather the flexibility and potential cost savings vs. the tax savings.

This is my plan as well.

i think i'm currently in the same boat.  based on FIRE date it will be 11-12 years after FIRE before kid 1 hits college.  which is almost 20 years from now.  i think the landscape will change.  i also think that the 4% rule is overly safe and our money will grow exponentially so we'll have extra to pay tuition with.

ForeignServiceWife

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Re: How much do you put away for college each month?
« Reply #40 on: February 01, 2017, 07:53:42 PM »
One kid, 20 months old. Currently contributing $1000 annually (she has $3000 right now) to a savings account that we are in the process of converting into a UGMA. We have plans for one more, maybe two more kids. Each will get the same. Once our own student loans are paid off (we've gotta finish paying for our college before we can worry about paying for our kids) and we are fully funding retirement, then this amount will be upped.

Our goal is for our kids to NOT use this money for college. As others have said, I sincerely doubt that, in 17 years, the costs of higher education will be structured the same way they are today. Google "education bubble". We will also emphasize AP/IB, as well as trade and vocational schools. If our kids really want to go the four year route, they can get scholarships and jobs to pay for it, or they can move to Germany or a Nordic country. Not even joking. The benefit of life in the Foreign Service - it will just be another international school for them.

steviesterno

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Re: How much do you put away for college each month?
« Reply #41 on: February 02, 2017, 08:23:03 AM »
Stevie. Why are you doing 529 then. It will be 19 years before our kids reach college. And I agree the landscape will likely be flipped on its head. I think a change in everyone going could change too

even if education won't be quite the same as it is now, my guess is that it will still be expensive. If my kid goes to trade school or gets scholarships, I'm covered. If not but another family member does go to a school like that, I can transfer to them.

If not, I can transfer to myself and take cooking classes in italy through an american university. since it's a school, travel and related expenses are educational expenses. so I can go back myself and travel for free ;) I don't know that I'll always work in higher education, and not sure I'd recommend my career path for my kid, so not banking on him coming here for free.

I don't know what's going to happen, but I know the best time to plant a tree is 20 years ago. I can stomach the 100/month now, and if it starts to look like I won't need it, I'll throttle back.

WE're not as militant as many on this board, but we did buy less house than we could afford, drive used cars, save a bunch each month, etc. I think not using the money for education and taking the 10% hit will be worth it for 2 decades of tax free growth. Not sure, but only one way to find out. Putting some in regularly should lead to growth, and if my parents want to chip in for presents, so be it.

boarder42

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Re: How much do you put away for college each month?
« Reply #42 on: February 02, 2017, 08:43:07 AM »
Stevie. Why are you doing 529 then. It will be 19 years before our kids reach college. And I agree the landscape will likely be flipped on its head. I think a change in everyone going could change too

even if education won't be quite the same as it is now, my guess is that it will still be expensive. If my kid goes to trade school or gets scholarships, I'm covered. If not but another family member does go to a school like that, I can transfer to them.

If not, I can transfer to myself and take cooking classes in italy through an american university. since it's a school, travel and related expenses are educational expenses. so I can go back myself and travel for free ;) I don't know that I'll always work in higher education, and not sure I'd recommend my career path for my kid, so not banking on him coming here for free.

I don't know what's going to happen, but I know the best time to plant a tree is 20 years ago. I can stomach the 100/month now, and if it starts to look like I won't need it, I'll throttle back.

WE're not as militant as many on this board, but we did buy less house than we could afford, drive used cars, save a bunch each month, etc. I think not using the money for education and taking the 10% hit will be worth it for 2 decades of tax free growth. Not sure, but only one way to find out. Putting some in regularly should lead to growth, and if my parents want to chip in for presents, so be it.

i like those thoughts in the middle.  didnt think about cooking classes abroad for myself and putting the travel on it.  i think we are all missing a big loop hole in the 529 plans here. 

Secretly Saving

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Re: How much do you put away for college each month?
« Reply #43 on: February 02, 2017, 12:36:20 PM »
Stevie. Why are you doing 529 then. It will be 19 years before our kids reach college. And I agree the landscape will likely be flipped on its head. I think a change in everyone going could change too

even if education won't be quite the same as it is now, my guess is that it will still be expensive. If my kid goes to trade school or gets scholarships, I'm covered. If not but another family member does go to a school like that, I can transfer to them.

If not, I can transfer to myself and take cooking classes in italy through an american university. since it's a school, travel and related expenses are educational expenses. so I can go back myself and travel for free ;) I don't know that I'll always work in higher education, and not sure I'd recommend my career path for my kid, so not banking on him coming here for free.

I don't know what's going to happen, but I know the best time to plant a tree is 20 years ago. I can stomach the 100/month now, and if it starts to look like I won't need it, I'll throttle back.

WE're not as militant as many on this board, but we did buy less house than we could afford, drive used cars, save a bunch each month, etc. I think not using the money for education and taking the 10% hit will be worth it for 2 decades of tax free growth. Not sure, but only one way to find out. Putting some in regularly should lead to growth, and if my parents want to chip in for presents, so be it.

i like those thoughts in the middle.  didnt think about cooking classes abroad for myself and putting the travel on it.  i think we are all missing a big loop hole in the 529 plans here.

529 plans for adults?? -- https://www.wsj.com/articles/SB10001424052748703818204576206970450531078

FireLane

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Re: How much do you put away for college each month?
« Reply #44 on: February 02, 2017, 08:04:21 PM »
One little guy here, 5 months old now. We're putting $100/month into a 529 for him, plus cash gifts from grandparents.

My back-of-the-envelope math says this will add up to $50K-ish by the time he's college age, which I think is a reasonable amount. It's possible that college as an institution will have changed drastically by then - maybe we'll have socialism and public college will be free, or maybe it will all be over the internet for cheap - and we don't want to oversave and then not have access to that money ourselves. You can take out a loan for college, but you can't take out a loan for retirement. Plus, if need be, we can always give him more money from our own taxable accounts.

Metric Mouse

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Re: How much do you put away for college each month?
« Reply #45 on: February 03, 2017, 12:13:37 AM »
We have one 6 month old. We're planning on $5k/yr. With compound interest around 4%, that should come to $120k to cover room/board for 4 years at a reasonable college. Grad school we will probably cover separately when the time comes.
Isn't it amazing how compound interest works? Such a small amount of money each year will cover them for years.

boarder42

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Re: How much do you put away for college each month?
« Reply #46 on: February 03, 2017, 04:17:27 AM »
We have one 6 month old. We're planning on $5k/yr. With compound interest around 4%, that should come to $120k to cover room/board for 4 years at a reasonable college. Grad school we will probably cover separately when the time comes.
Isn't it amazing how compound interest works? Such a small amount of money each year will cover them for years.

This is poor compounding. 5k for 18 years and only 120k. Even if you only assume 5% real returns that should be almost 150k in today dollars.

69mach351

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Re: How much do you put away for college each month?
« Reply #47 on: February 03, 2017, 10:17:03 AM »
My wife and I have mixed feelings.  I think we should help the kids as much as possible and she thinks that they need to be primarily responsible.  I do see the value of them having skin in the game. 

I read an article years back about a dad that would take whatever spare change he has in his pocket at the end of the day, and put it in their kids' college fund.  It may not seem like a lot, but it adds up over time when invested halfway decently.  I started doing that, as well as a few bucks here and there.  Grandparents have contributed a bit. The kids are still over a decade away from school, but have about $5-6k.  By the time they hit that point (hopefully well before) our house will be paid off, so we will be able to help a little more as well.

Vindicated

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Re: How much do you put away for college each month?
« Reply #48 on: February 03, 2017, 10:23:57 AM »
My wife and I have mixed feelings.  I think we should help the kids as much as possible and she thinks that they need to be primarily responsible.  I do see the value of them having skin in the game. 

I read an article years back about a dad that would take whatever spare change he has in his pocket at the end of the day, and put it in their kids' college fund.  It may not seem like a lot, but it adds up over time when invested halfway decently.  I started doing that, as well as a few bucks here and there.  Grandparents have contributed a bit. The kids are still over a decade away from school, but have about $5-6k.  By the time they hit that point (hopefully well before) our house will be paid off, so we will be able to help a little more as well.

If people are interested in this method, but don't use cash often, you could use Acorns.  I've been using it for a year now, and have saved ~$1000.  Although, I keep pulling the money out of it to pay off debt.  Eventually I'll let it grow there, or pull it out to put it into my Son's 529.

teamzissou00

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Re: How much do you put away for college each month?
« Reply #49 on: February 03, 2017, 10:34:26 AM »
Side note question - I haven't put a lot of research into the financial aid situation.  Several co-workers are saying that I'll be essentially forced to pay for my 3 kids college.  Is that true?

What I've been hearing is that we most likely will not qualify for financial aid, and that if they want student loans, they will be private and i'll be forced to co-sign.  True?

Of course I'm hoping they'll have scholorships and all that - but if not I'm troubled by having to consider being on the hook for all of their college costs.

 

Wow, a phone plan for fifteen bucks!