Author Topic: ER vs investing in kids  (Read 10198 times)

God or Mammon?

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ER vs investing in kids
« on: April 20, 2014, 03:14:03 PM »
We have 2 young kids, 8 and 5.  Both are in school and do several activities (one primary sport, one instrument and one other 'enrichment' each).

The total spending for both kids' school tuition and all of the above mentioned activities came to 13% of our net (after taxes) income.

We save about 30% of our net income.

While we would love to save more, we live in a high COL area and our incomes (both professionals), while high by national standards, don't go as far as we would like with all of the costs associated with a young family.  We don't really spend a lot on ourselves and most of the expenditure is on necessities and stuff for the kids.  While the 13% could be trimmed a bit, the reality is we wouldn't feel comfortable going to 0%, but might be willing to sacrifice if we really needed to down to 3% (and feel guilty while doing it).

So the question I have is, while it is a highly personal and situation specific scenario, what do people feel about delaying ER in order to spend a bit more on the kids, hoping that it pays off eventually for them later in life?

Tyler

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Re: ER vs investing in kids
« Reply #1 on: April 20, 2014, 03:33:02 PM »
I don't have kids, and don't judge people who choose to spend money on their own. So I just have a relatively simple question.

Do you really feel private school, sports fees, music lessons, and expensive "enrichment activities" for very young children are an investment?  What is the expected return?  Are you convinced the 5-year old will get a sports scholarship?  If so, that's great.

If they're not an investment, what are they?  If they're really just consumption on your part to meet the social expectations of other parents around you, perhaps your kids would be better enriched by you purchasing less and spending more time with them.

Gin1984

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Re: ER vs investing in kids
« Reply #2 on: April 20, 2014, 04:22:22 PM »
We made the choice, when choosing to have kids, that would mean a certain standard of living for them, including private school and much of college paid for.  That means, that instead of saving near 1/2 our salary, we only save about 20%.  We plan to retire when they finish college (and one is not even born) so 25 years from now.  All personal finance choices are personal.  Do what feels right to you.

Gin1984

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Re: ER vs investing in kids
« Reply #3 on: April 20, 2014, 04:24:56 PM »
I don't have kids, and don't judge people who choose to spend money on their own. So I just have a relatively simple question.

Do you really feel private school
, sports fees, music lessons, and expensive "enrichment activities" for very young children are an investment?  What is the expected return?  Are you convinced the 5-year old will get a sports scholarship?  If so, that's great.

If they're not an investment, what are they?  If they're really just consumption on your part to meet the social expectations of other parents around you, perhaps your kids would be better enriched by you purchasing less and spending more time with them.
My husband and I went to schools in the same area and he went to a decent public school, whereas I went to a private school.  Things I was taught and thought were basic knowledge he did not learn in school and had to play catch-up as he got older.  It was as big of a deal in college but now, in grad school, dealing with professors, it has come into play, more and more.  So I do see private school as an investment in their future.

La Bibliotecaria Feroz

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Re: ER vs investing in kids
« Reply #4 on: April 20, 2014, 07:45:32 PM »
My husband went to public school and has taught both public school and private school (boarding, actually). He feels that good students at a good public school get an education that is AT LEAST as good as private school, and in some cases better. Some places, of course, do have "bad" public schools, but it takes more than test scores to identify those. And with private school comes pressure to match a certain very non-Mustachian status (Coach purses, North Face jackets, whatever young people are spending these days).

I would encourage anyone wondering how much to spend on their kids to read The Millionaire Next Door, which has a really thought-provoking section on adult children of millionaires (with lessons that I think would trickle down to younger kids as well). I'm not saying that people shouldn't spend money on their kids, just that doing it the wrong way can do more harm than good.

Thegoblinchief

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Re: ER vs investing in kids
« Reply #5 on: April 20, 2014, 07:53:45 PM »
Investing in kids != the amount of money you spend on them.

I would need more details to offer judgment. I had a very mixed experience with private schools and currently homeschool. FWIW, we spend 2% of our slightly above median income on education.

Simple Abundant Living

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Re: ER vs investing in kids
« Reply #6 on: April 20, 2014, 08:25:29 PM »
Our youngest two children are 6 and 8, so I have an idea of what kids this age do. We have good public schools. We have put the girls in soccer, dance and tumbling (not at the same time) through the local recreation centers. The cost of those programs have been anywhere from $15-25 per month.  Piano lessons here cost $10-15 per half hour lesson.  With our income well into six figures, my girls schooling, sports and activities don't even register as a percentage of our net income.

What I can't figure out is if you spend this much now, what will it be when they are 10 and 13 or 15 and 18?  My experience is that kids get progressively more expensive, especially if you set the expectation that you are going to provide all these things.  Club travel sports, piano lessons with Steinway artists, study abroad- these are all things we've done or will do with our older children. First, they must show interest, aptitude, and self motivation. I'm all for encouraging your kids in their talents and interests, but you may want to pace yourselves if you don't want that % you spend now climb higher and higher until it cuts into your ER plans. I would also say that when kids have some of their own "skin in the game", they are alot more invested in their own dreams.   We made the mistake of providing everything at one point. The result was entitlement, which I feel is the opposite of what we wanted.
« Last Edit: April 20, 2014, 09:15:27 PM by Mrs. Green'stache »

God or Mammon?

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Re: ER vs investing in kids
« Reply #7 on: April 20, 2014, 08:34:53 PM »
I probably should have limited my question to people who have children.

No we don't get lessons for our kids or spend money on their activities to meet 'social expectations'.  I won't even bring up schools because people seem to have such broad and differing views and expectations of what a 'good' school or education is, and it's impossible to convince someone who doesn't value it at the same level to help her understand why spending more (or less) makes sense.  Same goes for things like sports or music or anything that takes resources to master - my question would simply be "why would we go through the trouble of investing our (and our children's) time and our money if we didn't think it was important?"

On a separate note, I have noticed a bit of an anti-child tone to some of the blog and forum, which is a bit disappointing as well as puzzling as the progress of mankind has relied upon populations being able to replenish themselves (the average woman bearing at least 2 children) and the societies that don't throughout history have ultimately crumbled.  Makes me wonder if that demographic time bomb everyone is talking about (not just the entitlement problem here in the US and other developed nations but the global population starting to shrink in about 30 years) really is as bad as some are predicting if this is the zeitgeist.

sheepgetlambs

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Re: ER vs investing in kids
« Reply #8 on: April 20, 2014, 08:45:31 PM »
Love the "skin in the game" idea mentioned by Mrs. Green'stash. We provide piano lessons for our kids because we are a family of musicians and our oldest was practically born composing music. For us, piano skills are as important a life skill as bike-riding or ice skating. Not quite as high as swimming skills, since that involves potentially life-saving knowledge, but you get the idea. Not hoping for scholarship or performance career (quite the opposite, actually) but a life-skill we want them to have. Just as we'll pay for them to have some golf lessons when they're older so they have some idea how to play the game later in life.
That being said, our oldest got a little belligerent (sp?) with her piano teacher one day last year. The consequence was we had her pay for that lesson. That was a painful lesson for her because she gets $1 per week allowance. We told her we were happy to pay for her to have the opportunity to acquire this skill but that she had to have a good attitude and work hard. Same goes for swimming or any other activity she takes on. -We only had to do it once. So far, the younger child has learned just from hearing that big sister had to pay. We remind them attitude is a choice and it's OK to say something is hard and they need it slowed down or simplified. It's not OK to be a smart-aleck or be combative.

God or Mammon?

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Re: ER vs investing in kids
« Reply #9 on: April 20, 2014, 08:48:09 PM »
Our youngest two children are 6 and 8, so I have an idea of what kids this age do. We have good public schools. We have put the girls in soccer, dance and tumbling (not at the same time) through the local recreation centers. The cost of those programs have been anywhere from $15-25 per month.  Piano lessons here cost $10-15 per half hour lesson.  With our income well into six figures, my girls schooling, sports and activities don't even register as a percentage of our net income.

What I can't figure out is if you spend this much now, what will it be when they are 10 and 13 or 15 and 18?  My experience is that kids get progressively more expensive, especially if you set the expectation that you are going to provide all these things.  Club travel sports, piano lessons with Steinway artists, study abroad- these are all things we've done or will do with our older children. First, they must show interest, aptitude, and self motivation. I'm all for encouraging your kids in their talents and interests, but you may want to pace yourselves if you don't want that % you spend now climb higher and higher until it cuts into your ER plans. I would also say that when kids have some of their own "skin in the game", they are alot more invested in their own dreams.   We made the mistake of providing everything at one point. The result was entitlement, which I feel is te opposite of what we wanted.
A good question wrt cost escalation as they get older.  We have limited what they do to three things max, and in reality some of the activities (like sports) require a bit more investment upfront to gain proficiency as well as the fact that they probably have the most amount of free time now vs later to pursue those interests, so I don't think costs will be dramatically higher going forward.

For us the question comes down to whether we should be cutting spending on the kids down to minimal levels in order to retire a few years early - there is some room for debate, but the question to us is not 'are these worthwhile pursuits?' as some tend to be implying.

mxt0133

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Re: ER vs investing in kids
« Reply #10 on: April 20, 2014, 09:17:36 PM »
The approach we are taking with our kids is to reach FI or at least semi-FI so that we can invest more in our children, where the currency is time.  That means since my oldest was born my wife quit her job to be a SAHM.  As they get older we plan to homeschool/unschool and I would like to work part-time to contribute in their education as well.  Our belief is that time is the best investment we can make for them, but we also recognize that we need to spend some money on things that we know we need help in, i.e. swimming lessons at 2 yrs old.  We completely understand that no matter what some experiences do cost money.  But we also believe that they don't have to cost a lot.  Even though our children have traveled across the world, we know they don't need to travel as far to be exposed to different cultures.  We don't need to travel to exotic/remote locations to experience natures beauty.  With a little research and ingenuity the world is literally at their finger tips at a very modest price.

I am basically following MMM's philosophy that children only cost as much as the parents allow.


Thegoblinchief

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Re: ER vs investing in kids
« Reply #11 on: April 21, 2014, 05:33:30 AM »
No we don't get lessons for our kids or spend money on their activities to meet 'social expectations'.  I won't even bring up schools because people seem to have such broad and differing views and expectations of what a 'good' school or education is, and it's impossible to convince someone who doesn't value it at the same level to help her understand why spending more (or less) makes sense.  Same goes for things like sports or music or anything that takes resources to master - my question would simply be "why would we go through the trouble of investing our (and our children's) time and our money if we didn't think it was important?"


If so many things are off the table, why even ask the question? Sounds like your mind is made up, and you're just looking for comments to fulfill a confirmation bias.

Quote
On a separate note, I have noticed a bit of an anti-child tone to some of the blog and forum, which is a bit disappointing as well as puzzling as the progress of mankind has relied upon populations being able to replenish themselves (the average woman bearing at least 2 children) and the societies that don't throughout history have ultimately crumbled.  Makes me wonder if that demographic time bomb everyone is talking about (not just the entitlement problem here in the US and other developed nations but the global population starting to shrink in about 30 years) really is as bad as some are predicting if this is the zeitgeist.

Geometric population growth isn't sustainable. Technology provides solutions, but consider how industrialized the food supply already is. Everyone claims they want to do free range/organic/local but this just isn't possible with the rising population.

A healthy dose of "anti-child" views, as long as everyone stays respectful, is a good thing in my mind. When I first joined the forums I let it 'offend' me a bit, being a parent, but I got past the knee-jerk reaction and now understand where they come from.

God or Mammon?

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Re: ER vs investing in kids
« Reply #12 on: April 21, 2014, 05:51:02 AM »
No we don't get lessons for our kids or spend money on their activities to meet 'social expectations'.  I won't even bring up schools because people seem to have such broad and differing views and expectations of what a 'good' school or education is, and it's impossible to convince someone who doesn't value it at the same level to help her understand why spending more (or less) makes sense.  Same goes for things like sports or music or anything that takes resources to master - my question would simply be "why would we go through the trouble of investing our (and our children's) time and our money if we didn't think it was important?"


If so many things are off the table, why even ask the question? Sounds like your mind is made up, and you're just looking for comments to fulfill a confirmation bias.

Quote
On a separate note, I have noticed a bit of an anti-child tone to some of the blog and forum, which is a bit disappointing as well as puzzling as the progress of mankind has relied upon populations being able to replenish themselves (the average woman bearing at least 2 children) and the societies that don't throughout history have ultimately crumbled.  Makes me wonder if that demographic time bomb everyone is talking about (not just the entitlement problem here in the US and other developed nations but the global population starting to shrink in about 30 years) really is as bad as some are predicting if this is the zeitgeist.

Geometric population growth isn't sustainable. Technology provides solutions, but consider how industrialized the food supply already is. Everyone claims they want to do free range/organic/local but this just isn't possible with the rising population.

A healthy dose of "anti-child" views, as long as everyone stays respectful, is a good thing in my mind. When I first joined the forums I let it 'offend' me a bit, being a parent, but I got past the knee-jerk reaction and now understand where they come from.

We are talking about the global population shrinking, which is the opposite of geometric population growth.

Think negative aggregate demand growth year over year, falling prices, lower standard of living (unless productivity magically explodes to offset it).

MayDay

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Re: ER vs investing in kids
« Reply #13 on: April 21, 2014, 05:51:49 AM »
3 activites at a time sounds like a lot.  Especially since some of them likely require more than once a week given the ages.  Or maybe you mean that throughout the year they do three different activities?

I wouldn't say that they have more time now for activities.  I would say they should have more time now to just play. 

I have a 4 and 6 year old and we do spend some on activities, but for the kid who is in full day school, three activities at a time would be way too much.  And yup, that means he isn't developing amazing sports skills. 

God or Mammon?

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Re: ER vs investing in kids
« Reply #14 on: April 21, 2014, 06:06:00 AM »
3 activites at a time sounds like a lot.  Especially since some of them likely require more than once a week given the ages.  Or maybe you mean that throughout the year they do three different activities?

I wouldn't say that they have more time now for activities.  I would say they should have more time now to just play. 

I have a 4 and 6 year old and we do spend some on activities, but for the kid who is in full day school, three activities at a time would be way too much.  And yup, that means he isn't developing amazing sports skills.

We basically took the view of having them do one sport which they can enjoy for a lifetime (and not just up to high school or college or while their bodies are young), one basic instrument (to develop an appreciation and understanding of music - doesn't have to continue beyond a certain minimum proficiency as they aren't going to be playing in Carnegie Hall) and one 'other', which could be a language/art/science/competitive game, etc.  It's averages out to about an hour total a day per child time commitment.

I would have thought that once they get older they would have less time as the school day is longer, homework load is greater (at least if they are getting a decent education), social activities (including just 'hanging out' with friends) become more pressing as well as interests in other stuff they would like to do on their own.  Giving them a minimum foundation in some of the basics in life (that one might actually want to appreciate or pursue if one were to ER) other than school and work seems like a nice thing to give a child, no?

Thegoblinchief

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Re: ER vs investing in kids
« Reply #15 on: April 21, 2014, 06:13:06 AM »
We are talking about the global population shrinking, which is the opposite of geometric population growth.

I won't respond to this, since I know what this thread devolved into, but read:

http://forum.mrmoneymustache.com/continue-the-blog-conversation/is-overpopulation-really-a-problem/

Okay, I guess I'll respond a little. Population decline could very well be a good thing, especially if it's tied in with improvements in sustainable living, reintegration of food supply with population centers, etc.

MayDay

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Re: ER vs investing in kids
« Reply #16 on: April 21, 2014, 06:15:09 AM »
3 activites at a time sounds like a lot.  Especially since some of them likely require more than once a week given the ages.  Or maybe you mean that throughout the year they do three different activities?

I wouldn't say that they have more time now for activities.  I would say they should have more time now to just play. 

I have a 4 and 6 year old and we do spend some on activities, but for the kid who is in full day school, three activities at a time would be way too much.  And yup, that means he isn't developing amazing sports skills.

We basically took the view of having them do one sport which they can enjoy for a lifetime (and not just up to high school or college or while their bodies are young), one basic instrument (to develop an appreciation and understanding of music - doesn't have to continue beyond a certain minimum proficiency as they aren't going to be playing in Carnegie Hall) and one 'other', which could be a language/art/science/competitive game, etc.  It's averages out to about an hour total a day per child time commitment.

I would have thought that once they get older they would have less time as the school day is longer, homework load is greater (at least if they are getting a decent education), social activities (including just 'hanging out' with friends) become more pressing as well as interests in other stuff they would like to do on their own.  Giving them a minimum foundation in some of the basics in life (that one might actually want to appreciate or pursue if one were to ER) other than school and work seems like a nice thing to give a child, no?

Whatever you want to do for your own kids is fine, but I think an hour a day is a lot of time and money during the school year when they are already in organized activities for 8 hours a day (school).  And if you are spending big $$$ on private school surely they provide plenty of enrichment as part if that?  Does that time include transport to and from these activities?   During the summer that sounds reasonable.  I don't think young kids need to do all the things, all year round.  Put them in music just over the summer, for example.  Or as their "other" activity, have it be a summer camp, and don't do it during the school year.


MayDay

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Re: ER vs investing in kids
« Reply #17 on: April 21, 2014, 06:16:31 AM »
Also, are they seriously in year round sports at one ages?  Or do you mean like swim lessons?  Either way, do them a few months, then switch seasonally and do the other activity.  Spend less money, spend less time, they will still gain the skills.

God or Mammon?

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Re: ER vs investing in kids
« Reply #18 on: April 21, 2014, 06:29:14 AM »
Population decline could very well be a good thing, especially if it's tied in with improvements in sustainable living, reintegration of food supply with population centers, etc.

That would be fine if the current entitlement benefit structure weren't dependent on more young workers covering for elderly retirees who will live longer.  Of course the natural result will end up being higher taxes (for those suckas who keep working - so I'm sure many here wouldn't mind), lower benefits (that might sting a bit for early retirees eventually) and a heavier hand from government (mixed bag there, but this community seems to lean a bit left).


OldDogNewTrick

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Re: ER vs investing in kids
« Reply #19 on: April 21, 2014, 06:30:19 AM »
The greatest gift any parent can give a kid is a solid and sustainable retirement plan. I know, my MIL had to move in with us 2 years ago because she had no other option. Invest in your kids, yes. But not to the detriment of your economic health.

Cpa Cat

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Re: ER vs investing in kids
« Reply #20 on: April 21, 2014, 07:47:40 AM »
For us the question comes down to whether we should be cutting spending on the kids down to minimal levels in order to retire a few years early - there is some room for debate, but the question to us is not 'are these worthwhile pursuits?' as some tend to be implying.

In order to cut a cost - any cost - you need to ask whether it's "worthwhile." Because if it is worth the money you spend on it, then why would you cut it? Why would you take something worthwhile from your child in order to retire a year earlier? On the other hand, if the cost is not worthwhile, or if there is a perfectly good cheaper substitite, then it's a no brainer - cut it.

So is it worthwhile to enroll your children in three activities instead of only one? Does your child gain enough "extra" to make it worth the money?

Is it worthwhile to enroll your children in private school, if there is a good alternative option?

The reason people seem against these kinds of costs (I don't think that's anti-child, necessarily), is that most people were not brought up in homes where they went to private schools or did three activities at a time. The vast majority of people go to public school. Most children engage in very few, if any, non-school extracurriculars.

When I look back at my childhood, I don't think "Gee, if only my parents had paid for more activities!" Man, I played with legos instead, and I liked it.

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Re: ER vs investing in kids
« Reply #21 on: April 21, 2014, 08:07:23 AM »
Balance the money you would plan on spending on your kids, vs the spare time you would have to actually be with your kids and guide them as they learn/grow.  Then decide which is actually more beneficial.

iris lily

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Re: ER vs investing in kids
« Reply #22 on: April 21, 2014, 08:22:58 AM »
I can't even imagine marshaling children into 6 activities a week and supporting same. A language/a sport/an instrument would be way too much for me. But then, I don't have children (and that's a good thing for them!) I value my sleep and alone time too much. I've heard parents say that they limit their children to 1 activity per semester--it might be Girls Scouts, it might be swim team. But that's it.

High end instruction is highly over rated. A few golf lessons at age 18 and someone can play golf (as stated upthread.) There are trainers all over the place who will work with adults on athletic endeavors--running, lifting, etc.

My husband makes a living doing carpentry and construction, having never had one lesson from a pro in his life. His graduate degree is in another field. When humans are motivated, they learn quickly.

norabird

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Re: ER vs investing in kids
« Reply #23 on: April 21, 2014, 11:06:35 AM »
Quote
On a separate note, I have noticed a bit of an anti-child tone to some of the blog and forum

I think some people on MMM are so focused on saving that they forget that some things in life are worth money, and that everyone values different things. Your choice to defer FIRE in order to spend on your kid's education and activities is a totally valid one, don't feel you need to be defensive over it. :)

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Re: ER vs investing in kids
« Reply #24 on: April 21, 2014, 11:30:18 AM »
Balance the money you would plan on spending on your kids, vs the spare time you would have to actually be with your kids and guide them as they learn/grow.  Then decide which is actually more beneficial.

A very good way to put it. To make homeschooling work with our subsequently reduced income, we can't spend a lot of money on activities. To be honest, I think that's been a good thing, as inexpensive activities usually mean we're getting out in nature where they can soak up the world around them.

Fonzico

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Re: ER vs investing in kids
« Reply #25 on: April 21, 2014, 11:39:48 AM »
FWIW, I deeply appreciated the extra-curricular programs my parents put me into. I started playing soccer at age 5, and while I was never terribly great at it, the friendships and team skills I learned were invaluable. I started piano lessons at age 8, and am so glad I have that skill. After we were "old enough" aka around 9 or so, it was understood that we played a winter sport, a summer sport, and an instrument (in addition to swimming lessons) -  it was up to us what we played, but those were the rules. .

And it kept me active while I was growing up, built a lot of skills and friendships, and has left me with a lasting ability that brings me a great deal of enjoyment and relaxation. I can't speak for my parents whether or not it was worth delaying their retirement or not, but it certainly wasn't a waste of money, and I am grateful to this day.

That being said, there are plenty of ways to accomplish that without breaking the bank. My piano lessons were from a local lady out of a church basement. See if you can get lessons from students majoring in music at University. Ringette was pretty expensive, admittedly, but offset a bit by soccer - I never played above rec level, so no tournaments, no travelling, and soccer equipment isn't too expensive. Pick and choose, don't just go all out with everything, and you should be able to find a balance.

MrsPete

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Re: ER vs investing in kids
« Reply #26 on: April 21, 2014, 01:13:34 PM »
We have 2 young kids, 8 and 5.  Both are in school and do several activities (one primary sport, one instrument and one other 'enrichment' each).  I'd suggest that at this age the BEST enrichment activities are those shared with family:  A membership to the zoo and the science museum, cooking together, camping, and other activities that bring the family together.  Now that mine are 17 and 20, I can say that one of the most influential thing we did was to have dinner together as a family almost every single night.  In retrospect, that has formed more of my kids' personalities than the guitar lessons or the horseback lessons. 

The total spending for both kids' school tuition and all of the above mentioned activities came to 13% of our net (after taxes) income.
Kids that young aren't going to benefit much from those activities, especially the enrichment.  Remember that whatever you're spending NOW will increase incrementally as the kids get older. 

As for tuition, we started in an inexpensive private school for two big reasons:  1) Scheduling.  By putting the oldest in kindergarten in a facility that also had day care, we were still spending the same amount of money we'd been spending on day care, and we were able to minimize time on the road /picking up - dropping off kids each day.  Before someone asks, busses weren't an option at that point.  2) We were disappointed that our public schools were not teaching phonics in the early grades.  We were NOT disappointed in the results we saw from their early years in the private school. 

However, it was a big expense for us, and we agreed that we'd take it on a year to year basis . . .  and at the point that the money wasn't worth the financial sacrifice, we'd make the move to public school.  When we did move, we were very happy with our choice:  Our kids got the best of the early grades' reading instruction, and then they moved into public schools just at the point they became the stronger option.  In high school, public school is clearly the better choice, especially if you have a strong student who will benefit from the wider range of courses, activities and other opportunities . . . or if you have a strong athlete who might be scholarship material (hint: If your kid's going to be an athletic scholarship candidate, you'll know by 8th grade -- if you're being honest with yourself). 
The greatest gift any parent can give a kid is a solid and sustainable retirement plan. I know, my MIL had to move in with us 2 years ago because she had no other option. Invest in your kids, yes. But not to the detriment of your economic health.
I don't agree that this is the GREATEST gift a parent can give a child, but it is important. 
Balance the money you would plan on spending on your kids, vs the spare time you would have to actually be with your kids and guide them as they learn/grow.  Then decide which is actually more beneficial.
Something I heard years ago that resonated with me:  Every time you say YES to something, you're saying NO to quiet family time or unstructured play time for kids.  As in so many other things, the right answer is BALANCE. 

We've said -- at times -- two activities per kid at any one time.  We've occasionally broken that rule (i.e., this activity is ending in another month, but this one starts now).  Anyway, we've found that to be a good balance in terms of money, time and involvement. 

I wouldn't want to retire at 40 and say to the kids, "Good luck with paying for college!"
Nor would I want to slave away to pay their every whim and then find myself eating cat food.
Balance is the right answer. 
« Last Edit: April 21, 2014, 01:23:16 PM by MrsPete »

greaper007

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Re: ER vs investing in kids
« Reply #27 on: April 21, 2014, 01:31:59 PM »
I only scanned the responses, so I apologize if someone already said this.    Why does it have to be work OR retire early.    Why not multiple retirements like the 4 Hour Work Week suggests?    I stopped working well before we even had savings, granted it was to be a SAHD.    Still, when I suggest retiring early to my wife she's not that interested.    She doesn't want to work long hours forever but she also doesn't want to stop working completely.    I understand that. 

Now our plan is to build up some savings and get her to a point that we can take 3-6 month vacations living in Europe, or traveling the Caribbean by sailboat.    Concurrently, we'd like to get her to a place that she can work 3-4 days a week and have that be enough to pay for college for our kids.

Now, she owns a consulting business so this is a possibility that exists for her that might not exist for other people.   

Also, why do you have to send your kids to a private school?   Is it for religious reasons?   If not, most areas of the country now how charter schools that are at the same level, or above many private schools.  The same goes for many public school systems.    All you have to do is buy a house in the right school district and apply.    My son goes to a charter school that is generally ranked number one in the Denver/Boulder area and is in about the top ten for schools overall.    We pay an extra fee for full day kindergarten, but after that we simply have to pay $1600 a year in property taxes.   I don't think you'd be able to spot a difference between this school and any private school.

NewStachian

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Re: ER vs investing in kids
« Reply #28 on: April 21, 2014, 01:33:04 PM »
I think it's sometimes hard to lose sight of what this site is all about. It's not about maintaining a mathematically optimal savings formula to minimize the time to FIRE (although it is for some people and that's great). The point of following the way of the Stache is to take control of your finances and be happy by getting rid of the things in your budget that aren't meaningful to you. Not all of us are hared-wired to optimizing savings 100%. Some of us flex our frugality muscles and get a different amount out than others. As long as we've got automated mechanisms in place to get us to our financial goals, we're succeeding.

My advice: invest in your kids how you see fit. Don't let your spending on your children get in the way of reaching your financial goals, but don't feel guilty every time you go out for an ice cream cone or go to a movie.

Tyler

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Re: ER vs investing in kids
« Reply #29 on: April 21, 2014, 02:20:38 PM »
I probably should have limited my question to people who have children.

Don't think of the child-less as unqualified to offer advice. Think of them as unbiased observers. Raising kids is very personal and emotional, and sometimes a little outside perspective may help see through the natural parenting reflex for a moment. FWIW, I love kids. And believe it or not I used to be one myself. ;)

If you truly feel the things you spend money on are helping your kids, then you're doing the right thing. Just take the time to occasionally honestly reevaluate your choices, and like any other financial decision make sure you're getting the best bang for your buck. Early retirement is not inherently good for its own sake.

Gin1984

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Re: ER vs investing in kids
« Reply #30 on: April 21, 2014, 02:44:07 PM »
Also, are they seriously in year round sports at one ages?  Or do you mean like swim lessons?  Either way, do them a few months, then switch seasonally and do the other activity.  Spend less money, spend less time, they will still gain the skills.
I don't think that is true, at least for my sport which is martial arts.  You lose the muscle memory when you don't keep practicing.

acroy

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Re: ER vs investing in kids
« Reply #31 on: April 21, 2014, 02:56:44 PM »
Howdy God (good handle ;))

Not sure I equate investing in kids with $$.  Time with their parents & other good role models is pretty darn important.

Dear wife and I manage not to spend much $$ on our 5 kiddos. We do have a nice house with a pool (easy to get in cheap Texas); that is probably the biggest dollar investment in their fun & activities.

We homeschool at a cost of under $1k for all of them. Activities are pretty cheap - walk to the park, swim, cook marshmallows; read.

best o luck!

Simple Abundant Living

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Re: ER vs investing in kids
« Reply #32 on: April 21, 2014, 03:08:01 PM »

We basically took the view of having them do one sport which they can enjoy for a lifetime (and not just up to high school or college or while their bodies are young), one basic instrument (to develop an appreciation and understanding of music - doesn't have to continue beyond a certain minimum proficiency as they aren't going to be playing in Carnegie Hall) and one 'other', which could be a language/art/science/competitive game, etc.  It's averages out to about an hour total a day per child time commitment.

I would have thought that once they get older they would have less time as the school day is longer, homework load is greater (at least if they are getting a decent education), social activities (including just 'hanging out' with friends) become more pressing as well as interests in other stuff they would like to do on their own.  Giving them a minimum foundation in some of the basics in life (that one might actually want to appreciate or pursue if one were to ER) other than school and work seems like a nice thing to give a child, no?

So, if I understand your statement above, I have some questions.

1) You will give them lessons in one lifetime sport.
- What if they develop interests in a team sport or other activity?  What if they show interest and aptitude to compete in that at a high level?  Are you going to say, "We provide lessons in [insert golf, tennis, skiing], you are on your own if you have any other interests."  If they become really good at [], will you shell out extra for professional lessons, camps, and etc?  If so, your current level of spending will not remain the same. 

2) You will provide lessons in one instrument (picked by yourself?) to a point of minimum competency. 
-Same question.  What if they want to try the harp?  Harps are in the tens of thousands and teachers are rare and expensive.  Do you say no?  What if that is their dream instrument?  What if they are really good and have a chance at Carnegie?  Will you restrict your lessons to a certain level or will you pay to see how far they can take their talent?

I am the mother of six kids from 20-yrs old down to six and I can assure you that you are currently in the "cheap" years of child-rearing.  I am currently putting kids #4 and #5 in braces (#6 is too young, but will need them too).  I have two kids driving (cars, insurance, gas) and one with his permit.  We have let the kids try different sports and activities and have supported them in their interests and aptitudes.   This means one has played on club volleyball teams which we have also had the expense to travel and watch her.  She has gone on to play D1 volleyball on scholarship.  We have one that loves football and wants to play at college.  So we have done college summer camps, nutrition counseling, and speed and agility training.  The next kid is a musical (and academic) genius.  He plays piano and guitar.  He has had lessons at a very high (and expensive) level, but has decided to stop lessons at the moment.  He is pursuing activities to become the language Sterling Scholar and wants to do study abroad.  He also skis in the winter and golfs in the summer.  And on down...  What I've learned is that despite have the same two parents, each child is completely unique.  They are influenced by us at young ages, but make their own decisions and have their own unique personalities. 

So what is our goal?  To make them the most successful?  Nope, It is to lead them to a happy, fulfilled life.  In our opinion, there are a lot of things that lead to a happy, fulfilling life.  First, I believe they need a happy family life.  This includes a lot of time with parents and siblings.  Second, they need a spiritual backbone.  Our kids learn about God at home, in church, and at mid-week church activities.  Third, they need to learn to serve.  Service activities are often woven into church activities and home life.  Fourth, they need to understand the importance of obtaining an education and preparing for a career.  And fifth, they should be supported (within reason and financial limits) in their interests and talents.  We believe that talents are given to us to share with others, bringing happiness to others and self.  Our financial goals to become FI are important, but second to our responsibility to the children we brought into the world.  Of course, as others have stated, balance is a key word.  And MMM's idea of optimization is important too.  I know of a family with limited resources that still found ways to provide sports and enrichment activities.  If you believe private school will make their lives more happy and fulfilled than if they were in public school, then you may justify that expense.  On the other hand, you may find that golf lessons at the local public course are less expensive than at the fancy country club, and the enjoyment is the same.  That might be an opportunity to optimize.  Make a list of your goals and values, look at the costs- both current and projected, decide which will really lead to happiness, and be flexible.  Those sweet little kids will soon have a mind and an agenda all their own.  And they might surprise you.
« Last Edit: April 21, 2014, 03:10:28 PM by Mrs. Green'stache »

JT

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Re: ER vs investing in kids
« Reply #33 on: April 21, 2014, 11:59:30 PM »
I have very fond memories of doing Little Aths 5-10; dancing 4-14; piano 10-14 and Air Cadets 14-18.

All activities I was keen on.

We also got a lot of time with Mum and Dad and Grandmas and Grandpas and Aunties and Uncles and cousins and friends.

My son does one activity after school: Tae Kwondo, which is something he wants to do at the moment.

Each to their own, but I'm blown away by the amount of 'taxi' time some parents set themselves up with.

It does seem costs are increasing with my son's age.  We're at the braces stage at the moment...

I've started having small talks with him about money, and he has recently decided to stick with his paper round so he can save $1,000 and then we'll pick a stock for him to buy and watch.