Author Topic: Doctor making $300k+ not sure he/she can help son pay for college  (Read 4465 times)

mlipps

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Bogleheads gives us some true gems sometimes. Let me clear, I don't generally think parents are obligated to fully fund their kids college educations. But this family has done absolutely nothing to set their kid up for paying themselves, the kid is mediocre at best academically with totally unrealistic goals (bad grades but thinks he's going to be an astrophysicist??), and the family's finances are just a disaster. I did some digging & noticed the family owns a used Porsche...other people dug up a trip to Portugal and a $750k house with almost no equity.

https://www.bogleheads.org/forum/viewtopic.php?f=2&t=282118
« Last Edit: May 29, 2019, 01:10:01 PM by mlipps »

bacchi

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #1 on: May 29, 2019, 01:31:39 PM »
The doctor's expenses are crazy high. A $300k income and only $2-3k left over at the end of the month? Wtf?

The chickens have come home to roost.

marty998

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #2 on: May 29, 2019, 03:07:49 PM »
They also paid of the kid's trip to Uzbekistan?

Also what Bank gives a 30 year mortgage to people who were (at the time) 46 and 49? were they going to keep paying $4,800 a month when they were pushing 80?

Sounds like a recipe for another GFC type event.

partdopy

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #3 on: May 29, 2019, 03:39:03 PM »
They also paid of the kid's trip to Uzbekistan?

Also what Bank gives a 30 year mortgage to people who were (at the time) 46 and 49? were they going to keep paying $4,800 a month when they were pushing 80?

Sounds like a recipe for another GFC type event.

Banks are not allowed to discriminate due to age (although that makes little sense)

six-car-habit

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #4 on: May 29, 2019, 03:56:54 PM »
They also paid of the kid's trip to Uzbekistan?

Also what Bank gives a 30 year mortgage to people who were (at the time) 46 and 49? were they going to keep paying $4,800 a month when they were pushing 80?

Sounds like a recipe for another GFC type event.

Banks are not allowed to discriminate due to age (although that makes little sense)

  Former co-worker had a golf buddy who was giddily happy when he was approved for a mortgage on a newer home.  He was 75 yrs old -  2nd hand quote," I don't care if i don't pay it off, its in a golf community!  Won't be my problem ! "

ysette9

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #5 on: May 29, 2019, 04:10:54 PM »
At least the crowd is roundly pointing out foolish mistakes and ways to improve.
Sure, they arenít criticizing spending to the same degree as the folks here would, but they arenít giving him/her a pass either. 

FireHiker

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #6 on: May 29, 2019, 04:59:10 PM »
I often say we are really more "Boglehead" than "MMM", but I really prefer the advice and vibe here. I was stunned by the person who made this comment:

Expensive mortgage
Retirement at 63 and 60
2x college
You can afford two of those things. Just not all three at the same time.

I would plan on retiring later.


Um, I think I'll stick around here where the advice would be "ditch the expensive mortgage and fix your priorities"...the travel they reference in that thread while still having a HELOC, and a student loan of 58k left, and evidently a fleet of cars is amazing to me.

For reference, my husband and I combined make almost 300k and we have the same giant mortgage as this poster (worse, actually, at $4145/mo, but with 3.25% fixed interest rate, and over 50% equity due to our original downpayment and appreciation). We aren't at fat-FIRE yet, but our NW including our equity is 1.6M, so we could downsize and retire in a LCOL area today. We are super spendy-pants compared to average around here, but we maintain at least a 40% savings rate (over 50% this month, woohoo!) and drive Hondas (Civic and CRV). I feel their pain of the extra $2200/yr adding son to car insurance...ours has a very reasonable Nissan Sentra, and adding him more than doubled our car insurance.

We also have a high school senior going to college next year. We agreed to pay for in-state public or equivalent. He got a scholarship to an out of state private school that drops our cost down to in-state public. We will cash flow college the next four years while we stay in our giant house until youngest is done with elementary school, and then we plan to downsize and possibly retire at that point. It means we'll cut back on our exorbitant travel we've enjoyed the past few years...travel hacking will have to be the heavy lifter for a few years. Reading that thread made me so stressed for them, and super thankful that we have made better financial decisions ourselves.

OtherJen

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #7 on: May 29, 2019, 05:41:31 PM »
At least the crowd is roundly pointing out foolish mistakes and ways to improve.
Sure, they arenít criticizing spending to the same degree as the folks here would, but they arenít giving him/her a pass either.

I appreciated the poster who linked to all the OPís recent posts about expensive travel plans. Some people really canít make the connection, can they?

mustachepungoeshere

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #8 on: May 29, 2019, 05:47:45 PM »
They also paid of the kid's trip to Uzbekistan?

Also what Bank gives a 30 year mortgage to people who were (at the time) 46 and 49? were they going to keep paying $4,800 a month when they were pushing 80?

Sounds like a recipe for another GFC type event.

Banks are not allowed to discriminate due to age (although that makes little sense)

They can't discriminate due to age here either.

They can, however, reject your application because you would eventually be unable to make the payments ... due to age.

Gotta have an exit strategy.

SwordGuy

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #9 on: May 29, 2019, 11:18:51 PM »
We got a mortgage at age 58 nd 68 respectively.   If we take the mortgage to term we'll be 73 and 83 when it's paid off.

Then again, we:

) put 20% down.
) bought at 96k below assessed value.
) own multiple houses free and clear that provide rental income.
) have enough assets to pay it off whenever we want.
) have a FIRE income of about $73k not counting stock/bond SWR amounts, about $130k if we add in a 4% SWR.

We would have to truly screw the pooch if we or our estate couldn't pay off the house.  And we've got a hell of a good credit track record.

I think it made perfect sense to loan money to us.






Car Jack

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #10 on: May 30, 2019, 11:21:03 AM »
To be clear, the husband, who posted makes $40k a year.  His wife, who's the spendthrift and a doctor bringing in most of the money is the problem.  You sort of have to read a bunch of the OPs posts to figure this out. 

I was tempted to write that my wife and I make half what he and his wife make, yet we pay for one son in private college and the other in a learning disability private high school.  And we have $2.4M in retirement savings and a paid off house.

ChpBstrd

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #11 on: May 30, 2019, 12:55:17 PM »
They also paid of the kid's trip to Uzbekistan?

Also what Bank gives a 30 year mortgage to people who were (at the time) 46 and 49? were they going to keep paying $4,800 a month when they were pushing 80?

Sounds like a recipe for another GFC type event.

Banks are not allowed to discriminate due to age (although that makes little sense)

Itís rare for a mortgage to be held to term. I think the average home is sold every 6-7 years, and due to early payoff the average experienced duration of mortgages is probably lower. The bank is not being unreasonable.

RWD

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #12 on: May 30, 2019, 01:29:35 PM »
I did some digging & noticed the family owns a used Porsche...
Gasp!

RWD

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #13 on: May 30, 2019, 01:37:11 PM »
I did some digging & noticed the family owns a used Porsche...
Gasp!
I found your post, "Maybe you can sell the Porsche." They have a 2001 911 C2 Cabriolet, one of the cheapest used Porsches, worth only ~$20k and probably no longer depreciating. Their 2015 Renegade Trailhawk is worth around $18k and depreciating rapidly. I would recommend selling the Jeep before the Porsche...

bacchi

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #14 on: May 30, 2019, 01:59:56 PM »
I did some digging & noticed the family owns a used Porsche...
Gasp!
I found your post, "Maybe you can sell the Porsche." They have a 2001 911 C2 Cabriolet, one of the cheapest used Porsches, worth only ~$20k and probably no longer depreciating. Their 2015 Renegade Trailhawk is worth around $18k and depreciating rapidly. I would recommend selling the Jeep before the Porsche...

They need to sell both if they're serious about covering college for their son and other child.

Or move to a smaller house. The utilities alone on that McMansion are $1000/month.

RWD

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #15 on: May 30, 2019, 02:16:12 PM »
I did some digging & noticed the family owns a used Porsche...
Gasp!
I found your post, "Maybe you can sell the Porsche." They have a 2001 911 C2 Cabriolet, one of the cheapest used Porsches, worth only ~$20k and probably no longer depreciating. Their 2015 Renegade Trailhawk is worth around $18k and depreciating rapidly. I would recommend selling the Jeep before the Porsche...

They need to sell both if they're serious about covering college for their son and other child.

Or move to a smaller house. The utilities alone on that McMansion are $1000/month.

The cars are the least of their problems. Housing, international travel, and probably a metric ton of miscellaneous smaller expenses are bleeding them dry.

mlipps

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #16 on: May 30, 2019, 03:59:53 PM »
I did some digging & noticed the family owns a used Porsche...
Gasp!
I found your post, "Maybe you can sell the Porsche." They have a 2001 911 C2 Cabriolet, one of the cheapest used Porsches, worth only ~$20k and probably no longer depreciating. Their 2015 Renegade Trailhawk is worth around $18k and depreciating rapidly. I would recommend selling the Jeep before the Porsche...

They need to sell both if they're serious about covering college for their son and other child.

Or move to a smaller house. The utilities alone on that McMansion are $1000/month.

The cars are the least of their problems. Housing, international travel, and probably a metric ton of miscellaneous smaller expenses are bleeding them dry.

Honestly I had to cross post here so I could revel in the snark which is sort of frowned upon at Bogleheads. To the OP's credit, they've stuck around the thread as people have liked on & seem to be trying to make the right choice at least.

DadJokes

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #17 on: May 30, 2019, 04:07:08 PM »
At least he is trying to get help and do better.

frugalecon

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #18 on: May 30, 2019, 04:27:42 PM »
At least he is trying to get help and do better.

Yes, I think I would be too humiliated to post that plea, even on an anonymous Internet forum. What is strange is that he is familiar with Bogleheads. They donít seem to be living a very Bogleheadish life. It is certainly a different slice of humanity than MMM, but the typical poster is not in that face-punchworthy state. Someone above posted that the two spouses were on different spending pages, based on other posts. Makes me glad that my spouse and I are more or less in sync.

PDXTabs

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #19 on: May 30, 2019, 09:59:22 PM »
Also what Bank gives a 30 year mortgage to people who were (at the time) 46 and 49? were they going to keep paying $4,800 a month when they were pushing 80?

1. They put 20% down or paid for mortgage insurance, then it was sold to a government sponsored entity or investment bank anyway.
2. They're going to be paying it down for 20 years while inflation erodes the dollar and the house price almost certainly goes up in dollar terms.
« Last Edit: May 30, 2019, 10:01:06 PM by PDXTabs »

Dragonswan

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #20 on: June 05, 2019, 02:37:01 PM »
They also paid of the kid's trip to Uzbekistan?

Also what Bank gives a 30 year mortgage to people who were (at the time) 46 and 49? were they going to keep paying $4,800 a month when they were pushing 80?

Sounds like a recipe for another GFC type event.

I got a mortgage at age 48.  I have no intention of paying it off; I will sell the home when I'm 60.  At that time I will buy another house with a mortgage.  If I live until 90 it will be paid off, if not, my heirs can sell it and square up with the bank.  The mortgage will be paid even though I'm so old because I have a pension and SS coming that cover it.  So there is no reason to deny a person a mortgage based on age.  You make a decision based on current ability to pay and put away the crystal ball.

Pizzabrewer

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #21 on: June 05, 2019, 03:04:05 PM »
Holy cannoli.  Their utilities are $1k per month?  $300 each for electric and gas?  $100 for water? This in a new, custom-built house??

Hard to fathom.

FireHiker

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #22 on: June 06, 2019, 11:38:53 AM »
Holy cannoli.  Their utilities are $1k per month?  $300 each for electric and gas?  $100 for water? This in a new, custom-built house??

Hard to fathom.

We have a new (6.5 years now) clown house and I cannot fathom utilities like that. With a 30,000 gallon pool our water bill peaks around $150/mo in the summer. Trash is $40. Before solar our electric and gas was $170-$400, with it only being $400 a month or two at the peak of summer. That still leaves hundreds of dollars difference. Not a very efficient house? Hasn't switched to LEDs yet? Either way, that is a ton of money.

Villanelle

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Re: Doctor making $300k+ not sure he/she can help son pay for college
« Reply #23 on: June 06, 2019, 12:32:47 PM »
They also paid of the kid's trip to Uzbekistan?

Also what Bank gives a 30 year mortgage to people who were (at the time) 46 and 49? were they going to keep paying $4,800 a month when they were pushing 80?

Sounds like a recipe for another GFC type event.
Banks are not allowed to discriminate due to age (although that makes little sense)


They can't discriminate due to age here either.

They can, however, reject your application because you would eventually be unable to make the payments ... due to age.

Gotta have an exit strategy.

How would being 75 (or 90) prevent someone from making a mortgage payment?  If they have the money, what difference does it make to the bank how old they are?  And considering most houses are sold long before the mortgage is ever actually paid off regardless of the age of the borrower, I don't see why the bank would be considered with the potential life-span of the mortgage holder. If/when they die, the property will be sold and the loan paid off.

And it the payer stops paying, the bank forecloses, just as they do on a 35 year old borrower.   

It makes perfect sense to me that banks wouldn't consider age when issuing a loan, even if it were legal to do so.