Speculating wildly, indeed. I'm guessing that the OP meant that he was viewing the combined totals of his and wife's IRAs and taxable account, and mistook the total for that taxable balance.
Regarding paying for college - Google EFC formula 2014-15. You should find the manual for calculating your EFC, to see how much DD will need for college this year, and the factors that influence it. Family size, number of kids in college, AGI, taxable/savings accounts are all important. Your retirement accounts, primary residence are NOT considered, so having more in retirement and less in taxable is good here. Have DD visit her HS guidance office to apply for all scholarships available. Work to improve her SAT as much as possible. Apply to multiple colleges, aid varies greatly from school to school, and is at least partially a function of how much a school wants you. She can petition the financial aid office for an increase. They can refuse, but they might do it, especially if another school is offering more, just to keep you. DS2 used this technique - he really wanted school 1, but school 2 offered more aid. He asked school 1 to up their offer, they asked to see the competition's offer, and beat it. Also make sure you know the details of all institutional scholarships and grants available. DD1 missed out on a full ride scholarship because she thought her SAT scores sent to a school were "good enough", and didn't update them when she got higher scores. She only learned of that scholarship in her acceptance folder, and realized after the deadline that she'd have qualified if they knew of her new scores.
Your EFC is based on the previous year's tax return, so if this is your DD's senior year, you will be filling out the FAFSA in January and using 2014's income. If your AGI is below $50k and you meet some other criteria, assets are excluded, which is very good. This means that maxing 401ks is useful, even if the FAFSA later adds that back to income. If you can get below $24k and meet criteria, you get an automatic EFC = 0. Auto EFC zero was easier before they dropped the income level from $32k.