Author Topic: Kids and College-Will you pay?  (Read 47619 times)

Jill the Pill

  • Guest
Re: Kids and College-Will you pay?
« Reply #100 on: February 25, 2013, 09:13:20 AM »
Quote
Quote
    Grad school because you're afraid of the real world?  It's not guaranteed you will get that degree, or even use it, but it IS guaranteed you will accrue a large sum of debt.  This just seems asinine to me.  Yet the debt will only grow from here.

Many of the students I've had in my courses who have gone on to graduate studies have done so because their job prospects were bleak . . .  Since more education is generally treated with greater esteem, they reasoned that by going to graduate school they could gain a competitive advantage when they do enter job market while deferring their loans when the job market was still down.  For some, their debt grew a little bit because interest accrued on some of their undergraduate loans. But most haven't added further debt by going to graduate school or they haven't added much more, at least. Most receive some form of tuition remission and stipend for teaching or research assistantship. 

Yes, this is me, and I am 43 (mother-of-3).  I am fully funded: tuition waiver, stipend, health insurance, no debt.  Grad school is simply the best part-time job available to me: challenging, flexible hours, new skills, and a degree.  The low pay is ok if you view it as an hourly rate.  I'm the second income, though, so there is less pressure.  It's not a fear of the real world; more a realistic balancing of options. 

Herbert Derp

  • Pencil Stache
  • ****
  • Posts: 660
  • Age: 31
  • Location: United States
Re: Kids and College-Will you pay?
« Reply #101 on: March 01, 2013, 05:29:35 AM »
My father paid for my degree. He started saving money for that purpose when I was born, and by the time I graduated he had $50k he was willing to spend on me. He didn't pressure me to go to any specific school or major, and just let me decide on my own what I wanted to do. But if I needed to spend more than $50k on my education I would have had to pay myself. I plan to do the same if I have children.

Ishmael

  • Stubble
  • **
  • Posts: 128
Re: Kids and College-Will you pay?
« Reply #102 on: March 05, 2013, 07:49:00 AM »
I don't think there's a universal answer to this.

We're saving enough to ensure that our kids can be successful on whatever path they choose. The dynamics of that will unfold when the kids are making their choices, and we'll tailor the solution to them because each kid is different, and has different motivations, interests and tendencies.

My parents didn't pay a cent of my university up front. I worked part time and summers and tried to do things as reasonably as possible. I lived at home, which required a car, so that added to the expense. Still, I had to borrow about $6k from my parents to get through it. At the end, they said, "Congrats, and don't bother paying that loan back". I had every expectation of having to pay it back, so that was a very nice bit of help and the right answer for me and who I was.

We know we definitely won't be just handing over money for their schooling, because money received like that isn't valued (normally). We'll make sure they receive whatever support is right for them in order to follow a path to success.

If they don't require as much support as we're saving for them, we'll figure out what to do with the extra then. If they're trying their best, they'll probably get it as a graduation gift as a start on their own 'stache. If they're reckless fools, we'll keep it and put it to good use (at least until they smarten up.)

It's hard to overstate how valuable teaching them the "Way of the Mustache" will be as they grow up though. It's truly amazing what a difference having good money knowledge and skills makes in our society, regardless of all the other skills. It might be a good idea to collectively create a "Mustachian curriculum for youth", and teach it in local communities to make sure as many kids as possible are learning it somewhere.

daymare

  • Bristles
  • ***
  • Posts: 465
  • Age: 32
Re: Kids and College-Will you pay?
« Reply #103 on: April 12, 2013, 11:57:44 AM »
A friend recently told me about how his parents handled things for him & his siblings: saved a set (equal) amount of money for each kid, then put them in charge of where they would go, how much they would have to pay, take out in loans, etc.  Some of his brothers went in-state and got their full education paid for.  My friend (like me) went to Carnegie Mellon, not a cheap place.  He paid for the rest with scholarships, loans, and summer jobs.  I think that's pretty brilliant -- they didn't limit his options, but helped him out, and ultimately left the responsibility for choosing a college and paying for it to him.

My parents fully paid for my education (& rent & food & books while I was in school).  So I had it really, really good and worked as a TA & grader & campus desk person while focusing on school.  My parents never talked about their finances (mostly because they're not super interested, they're in good shape) and I remember them making comments like 'we can probably pay for all of college .. we'll see' and getting really stressed out because I found it hard to plan and choose a college without knowing how much I would need to pay.  I don't care if I'm automatically spoiled because my parents paid for my education, as I am so grateful and I 100% know I would not have gotten my first job without a top-tier degree, and that I wouldn't have gotten into the PhD program I'll be attending without the name of my undergrad.  Of course I'm pretty sure life would have worked out either way (with different schooling), it would just have looked different.

An interesting question, though:  does not having loans in the first place make you more averse to taking them on later?  And vice versa?  I had no undergrad loans due to my awesome parents, and when considering more education, absolutely ruled out getting a master's degree or anything I would have to pay for (and potentially take loans out for).  (Thank god you get funding for a PhD.)  On the other hand, I know people who had debt for undergrad, then went on to have more debt for master's degrees -- any thought as to whether having some debt (and knowing your interest payments & what managing it entails) makes further educational debt seem less extreme?  I think there could be some element of truth there -- if paying loans is alreadya reality, adding more debt to the figure might not seem to be as big of a deal to the average person.  Thoughts?

MrsPete

  • Magnum Stache
  • ******
  • Posts: 3513
Re: Kids and College-Will you pay?
« Reply #104 on: May 02, 2013, 03:07:46 PM »
Consider how we reached this point that people think "everyone must have" a college degree:

We've made it so incredibly easy to get a high school diploma that only the real losers in the world DON'T have one.  I'm a high school teacher, and the number of second-third-fourth-fifth chances we give kids has become ridiculous.  I could give examples, but I just don't want to think about it . . . but the result is that a high school diploma, which used to mean something, really means very little now.  Thus, employers want more. 

I personally do not think it'll come to "everyone NEEDS a degree just to work".  Why?  First, only 25-30% of all Americans (aged 25 and older, if memory serves) have a bachelor's degree; so, although this "everyone has one" idea is pervasive, it isn't really factual.  I do think that number will increase in the immediate future.  Second, I totally agree that we're reaching the end of this bubble /trend.  People are realizing that a degree is no longer the automatic ticket to the good life, and that these two things are rather equal:

1.  Working in a blue collar job (or, better yet, starting your own business)
2.  Working in a professional job, but paying huge amounts of student debt over decades

We have college folks come to talk to our high school seniors every year, and the real issues are that our students aren't studying the things that America needs.  We do not need a bunch of theater or Psychology majors.  We can't fill the science-and-math related careers with American-born graduates anymore.  Yet we have a glut of Lawyers and Sociology majors.  Also, jobs are available for people with Associates' degrees, yet so many kids see those as "beneath them". 



I liked The Millionaire Next Door too, but keep in mind that it's got some years on it, and the school debts that they discuss in that book aren't equivalent to the school debts that today's students are facing.  As debt-opposed as I am, it's not the worst thing in the world for a student to graduate with a small loan and a profitable degree; however, no one today seems to be taking out small loans.  An excellent book, but a bit dated.  It'd be nice to see the author come out with an updated version.



What're we doing in our family?  We told our daugthers that we'd pay the following: 

Tuition and fees
at any of our state's 16 public universities
for 4 years /8 semesters.
Plus dorm and meal plan. 
Health insurance and cell phone. 

OR
Tuition and fees
at the state university 20 minutes down the road
for 4 years /8 semesters.
And we'd buy them a late-model used car. 
Health insurance and cell phone. 

If they wanted something more (private school, an apartment, summer school, an extra year), they'd still get the above . . . but they'd have to figure out the difference themselves. 

Lesson learned:  Don't nail things down too specifically before college begins.  We thought our plan was "just right", but then we learned that nursing majors must attend a mandatory 5-week summer school between sophomore and junior year (it's their preparation for student nursing, and it's ONLY available in summer school -- no choice).  What we meant when we laid out our plan was, "We expect you to carry a full load in the fall and spring semesters, and if you fail a class, we won't pay for you to re-take it in the summer."  Since this class is a different ballgame, we agree to pay the summer school as well.  Also, she chose a school that doesn't sell books -- $105 of the tuition goes to rent books, which turned out to be great:  Her Chemistry book cost $360.  Yes, really.  She paid nothing (nothing above and beyond tuition), and as long as she turns it in on time, no cost . . . ever.  Each semester she did have to buy a $10 lab manual.  So, she avoided the big expense we'd said was hers.  We decided NOT to give her another responsibility.  Why?  Because she worked her tail off in high school and earned 22K in scholarship money, which is roughly 45% of her 4-year education.  We decided she'd done her part financially.

We're telling her sister that it's our intention to pay what I listed above . . . and we'll come to something close to that, but we reserve the right to adjust it up or down a bit, depending upon her grades and decisions.  I anticipate she'll attend the same school as her sister, and she'll probably also avoid buying $360 Chemistry books.   

How's it worked out with the oldest daughter?  First semester she brought home a 3.95 GPA, and although exams are next week, she says she's anticipating a 4.0 for spring semester.  We couldn't be happier with her academic performance.   She's showed responsibility in many ways, and we are pleased with the decisions we've made.  She has actively sought out ways to save money; for example, she knows she's going to need scrubs of a certain color when she begins student nursing, so she's asked me several times to go with her to the discount outlet where they sell them for $7.99/item.  Sizes and colors are difficult to find, so she wants to start buying them bit-by-bit as they're available rather than waiting 'til she's a junior, then paying $100/outfit from the bookstore. 

As for kids appreciating vs. not appreciating their parents' sacrafices in putting them through college, this is a complicated topic, and it boils down to MUCH MORE than whether you're paying the bills or not.  You've been living with this kid for 18 years.  Either you've taught her to appreciate what she's given, or you haven't.  Either you've taught her the value of a dollar and have taught her to shop around, or you haven't.  Either she's shown gratitude for the things you've done for her, or you've let her get away with poor behavior.  The point:  You know this kid.  He's not going to suddenly become a different kid.  My kid is VERY appreciative of the fact that she'll be able to graduate with no debt.  We've had numerous conversations about the debt her dorm-mates are racking up, and she fully realizes that she's got it pretty good. 






MsGuided

  • Handlebar Stache
  • *****
  • Posts: 1039
  • Location: Colorado
Re: Kids and College-Will you pay?
« Reply #105 on: September 25, 2013, 12:10:18 PM »
Mrs. Pete

I hope you see this.  I have a few questions about what you've done with your daughters.  I would like to instill the work ethic and gratitude your older daughter is exhibiting.  You mentioned she worked really hard in high school &, based on her performance in nursing school, I assume she must have done really well in H.S. 

My older daughter is in middle school & is a very motivated student and is doing well in very accelerated classes.  I would like her to continue to do well in school, but a strong work ethic is more important to me.  B/c she is in these advanced classes she's surrounded by very motivated kids who, in general, have VERY involved parents with extremely high academic expectations for their kids.  Most of these parents are completely unconcerned with teaching frugality or the value of earning money, though.  They stress grades, test scores, and planning where they want their kids to go to college.  Many of my daughters' friends will never hold a menial job.  Their parents are busy padding their college resumes, sending them to camps at Ivy League schools, overseas leadership programs etc.

So, I'm wondering if you experienced this with your daughter (or as a teacher)?  Did you have her work during the school year in high school?  In the summer?  How does she get her spending money.

davisgang90

  • Handlebar Stache
  • *****
  • Posts: 1310
  • Location: Roanoke, VA
    • Photography by Rich Davis
Re: Kids and College-Will you pay?
« Reply #106 on: September 26, 2013, 08:03:42 AM »
I'm in the post-9-11 GI Bill group where I can pass my benefit to my kids.  Since I have a BS and an MS, I don't need it for myself.

I have 3 boys 19. 15 and 9. 

The 19 year old is attending a local community college through a program that guarantees his admission to any state 4 year school here in Virginia.  I'm paying for CC out of pocket and intend to use the GI bill for his last two years at Uni.

The deal I made for community college was that I would pay his books, fees and for any of his classes he maintained an A or B grade average.  If he got a C he paid half the tuition and Ds and Fs were all on him to pay.  You need a C or above for the course to transfer to uni.  After the first semester where he had to pay for an entire course (D) and half another course (C) the second semester was all B's.

My middle son has autism and most likely won't attend college.

My youngest will have the same option (Dad pays for 2 years of community college, GI Bill for the rest).

GreenMoneyStream

  • 5 O'Clock Shadow
  • *
  • Posts: 3
    • Green Money Stream
Re: Kids and College-Will you pay?
« Reply #107 on: September 26, 2013, 08:21:51 AM »
My son is not yet in kindergarten, so it is hard for me to say how much of his schooling I will pay for since it is so far out. Tuition has been outpacing inflation by a good clip since I was in college (~15 years ago) so I think it is getting harder for kids to do it on their own. What I am doing however, is saving a set amount each month in a 529 plan for him. My husband and I had to pay for college on our own, no help from parents. We figure that whatever we do save for our son will be more than we got and I'm sure it will be helpful for him. I don't think I would ever pay for his entire tuition, even if I could, because I think it is important for him to have a little skin in the game too.

Yes, this all pre-supposes that he will or should go to college. I still believe it is a good idea to at least get that foundation, and then decide where to go from there. It is still valuable in our society.

MrsPete

  • Magnum Stache
  • ******
  • Posts: 3513
Re: Kids and College-Will you pay?
« Reply #108 on: September 29, 2013, 06:17:59 PM »
You can't be a CPA with just a great work ethic, even if you're smart. You need a great work ethic and a degree.
To illustrate how things have changed, my father was a CPA but not a college graduate.  He came to America, studied accounting for three years, but in his last year he was just out of money and tired of being broke all the time.  So he decided to go take the CPA exam on a whim to see how far he was from the goal -- he didn't expect to pass, but he did.  This would've been early 1960s.  No one could do this today. 

MrsPete

  • Magnum Stache
  • ******
  • Posts: 3513
Re: Kids and College-Will you pay?
« Reply #109 on: September 29, 2013, 06:23:48 PM »
18th birthday and I sat in the truck with my parents driving to a party. In there we had 'The Talk'. Basically I was on my own for my own education completely, no monetary support whatsoever. Strangely one of my most fond memories of my parents . . .

Personally I've become a huge believer that the minimum age to enter most post secondary schooling should be one or two years after the average high school graduation age.
I'd say that however you plan to handle your child's educational costs, you should talk about it with them well ahead of time.  I think about the time they start high school is the right time.  They're old enough to understand the concept, and it gives them time to prepare. 

I disagree about the need to wait for college.  My mother tried to talk me into that, but I was very ready straight out of high school.  I made good choices with my minimal resources, and I excelled academically.  I'm glad I've had use of my degrees my entire adult life. 

MrsPete

  • Magnum Stache
  • ******
  • Posts: 3513
Re: Kids and College-Will you pay?
« Reply #110 on: September 29, 2013, 06:39:43 PM »
Yes, my oldest finished with 4.6 GPA, received two scholarships that total about 50% of her education, and was chosen by her teachers as the girl with the most outstanding character.  Additionally she obtained a CNA license and was the best in her high school nursing class.  She's a wonderful kid and has continued to do well in college. 

We do not provide spending money.  She worked during the summer (not as much as I would've liked), and she is very, very frugal.  She did not work as a freshman, and she "made it" only because she'd hoarded her graduation gift money.  She is working part time now as a sophomore in a job that doesn't pay well but will look great on her resume.  I'm not sure what she's going to do next summer.  She is required to attend a summer school class (taught only in summer) that is required of all juniors beginning nursing clinicals; thus, her ability to work will be hampered. 

She did not work during high school.  She was very, very involved in school activities, and we feel that paid off in scholarships.  Her younger sister (same caliber student, less involved in activities because of her shyness) is interested in a job -- she likes money a great deal -- but she isn't doing too well in her job search.  It's not easy for a 16 year old to get that first start, if she isn't desperate enough to work fast food.  I'm not all that interested in her working during the school year, but I'll help her find something next summer. 

Yes, I see the overly involved, money is no object crowd at school.  In the long run, these parents don't seem to be getting much bang for their excessive buck.  Their kids vary too widely to generalize about them. 

Mrs. Pete

I hope you see this.  I have a few questions about what you've done with your daughters.  I would like to instill the work ethic and gratitude your older daughter is exhibiting.  You mentioned she worked really hard in high school &, based on her performance in nursing school, I assume she must have done really well in H.S. 

My older daughter is in middle school & is a very motivated student and is doing well in very accelerated classes.  I would like her to continue to do well in school, but a strong work ethic is more important to me.  B/c she is in these advanced classes she's surrounded by very motivated kids who, in general, have VERY involved parents with extremely high academic expectations for their kids.  Most of these parents are completely unconcerned with teaching frugality or the value of earning money, though.  They stress grades, test scores, and planning where they want their kids to go to college.  Many of my daughters' friends will never hold a menial job.  Their parents are busy padding their college resumes, sending them to camps at Ivy League schools, overseas leadership programs etc.

So, I'm wondering if you experienced this with your daughter (or as a teacher)?  Did you have her work during the school year in high school?  In the summer?  How does she get her spending money.
« Last Edit: September 29, 2013, 06:45:36 PM by MrsPete »

imustachemystash

  • Bristles
  • ***
  • Posts: 406
  • Age: 41
  • Location: Seattle
Re: Kids and College-Will you pay?
« Reply #111 on: September 30, 2013, 04:21:34 PM »
We put $100 aside each month for each of our 2 sons in a 529.  We will see what the total is when they are ready to go to college and go from there.

lentilman

  • Stubble
  • **
  • Posts: 175
    • the Independent Penguin
Re: Kids and College-Will you pay?
« Reply #112 on: September 30, 2013, 09:23:59 PM »
I'm targeting a 100K fund for my son, although it may not get there depending on market returns.   I'm also hoping he has online options available for him by the time he is ready to go (2023 or so).

MrsPete

  • Magnum Stache
  • ******
  • Posts: 3513
Re: Kids and College-Will you pay?
« Reply #113 on: October 01, 2013, 08:15:43 AM »
I'm targeting a 100K fund for my son, although it may not get there depending on market returns.   I'm also hoping he has online options available for him by the time he is ready to go (2023 or so).
Remember, too, that most of us are still working while our kids are in college.  So what you've saved isn't your only resource for paying college tuition.  Some savings -- even if it's not enough to pay the whole bill -- coupled with current earnings is pretty useful. 

RootofGood

  • Handlebar Stache
  • *****
  • Posts: 1361
  • Age: 41
  • Location: North Carolina
  • Retired at age 33. 5 years in, still loving it!
    • Root of Good
Re: Kids and College-Will you pay?
« Reply #114 on: October 01, 2013, 08:37:46 AM »
My original plan was to set aside enough to fund 4 years of in state tuition for each of our 3 kids.  We have about half the required amount in a 529 account, and figure we'll fund the rest from our investment portfolio as necessary.  This may mean cutting spending back (forgoing a vacation) or me or Mrs. RootofGood picking up some part time work (we'll both be retired when the oldest starts college). 

The kids are 1, 7, and 8, so we are still 10 years away from college expenses for the oldest, and 17 years away for the youngest. 

There are so many options out there for financial aid or avoiding/mitigating college costs that I didn't want to over save. 
  • Summer jobs for kids during high school and college
  • work study programs
  • research/teaching grants/assistanceships (yes, even in undergrad!)
  • scholarships
  • side hustle businesses
  • living with parents while attending a great local state U
  • 2 year community college transfer to finish out years 3, 4
  • AP classes in high school
  • student loans

Who knows, my kids might be entrepreneurs and not go to college.  Or traditional 4 year college might not be their thing. 

ace1224

  • Bristles
  • ***
  • Posts: 469
Re: Kids and College-Will you pay?
« Reply #115 on: October 01, 2013, 09:40:13 AM »
yep i'll pay.

Ottawa

  • Handlebar Stache
  • *****
  • Posts: 1033
Re: Kids and College-Will you pay?
« Reply #116 on: October 01, 2013, 11:19:57 AM »
Yes.  But, mini Ottawa won't know about that.  She'll be selling lemonade, delivering papers, etc etc.  The nexus between work and money will be solid.  Call the college education an early inheritance :-)

Details at this thread:
https://forum.mrmoneymustache.com/mini-money-mustaches/canada-registered-education-savings-plan/

cbgg

  • Stubble
  • **
  • Posts: 192
  • Location: Vancouver, BC
Re: Kids and College-Will you pay?
« Reply #117 on: November 01, 2013, 12:49:40 PM »
Honestly, speaking as someone not too far out from college, I think an individual paying for at least part of it themselves tend to take it more seriously and get more out of it.

I knew lots of people whose parents were paying for the whole thing.  Think they felt bad skipping classes, not working hard, etc.?

I kinda think the opposite is true. My parents couldn't afford to help pay my college at all, but if they had I would have felt a huge burden to do well. Since I was paying for it myself, I felt more like a customer. If I wanted to skip class or skate by with a C, it was no one's business but mine because I was paying for it.

On the flip side, I was probably more inclined to buy used books and supplies than I would have been if my parents paid for it. Also, I felt more freedom to choose my classes and major. If they had been footing the bill, I would have felt obligated to study what they wanted me to (law).

You are likely much more self motivated than the typical individual who is spoiled by parents and has everything paid for them.

I am an individual who was spoiled by my parents and had everything paid for for me.  I felt enormous pressure to do well in school because I come from a family that set high standards for achievement, I believed I was capable of being better than those around me, and because I'm an achievement driven person.  I did quite well in school (high but not amazing grades, was asked to be the valedictorian speaker for my BBA class due to well rounded achievements).

Honestly, I think your orientation toward taking school seriously can be effected by who's paying, but is SO MUCH MORE than that.  I think it has a lot to do with your attitude toward achievement and learning in general, your expectations of yourself, knowing why you are there, etc.

I certainly knew people in school who slacked off.  Some were getting a free ride, some were taking out loans.  I also knew lots of people who were getting help from their parents but still worked their booties off. 

cbgg

  • Stubble
  • **
  • Posts: 192
  • Location: Vancouver, BC
Re: Kids and College-Will you pay?
« Reply #118 on: November 01, 2013, 01:10:35 PM »
I don't have kids but might one day.  As someone pursuing FI it's hard not to think about it! 

Because I think the nature of education is changing so dramatically right now, my main focus will be to have my kids think about WHY they are pursuing education (if they do) and make choices that balance the costs and the benefits.  I think I would provide them with a set amount of money for education and help them work though the best way to spend it.

partgypsy

  • Magnum Stache
  • ******
  • Posts: 4626
Re: Kids and College-Will you pay?
« Reply #119 on: March 25, 2021, 03:35:35 PM »
My 2 cents: my parents paid for my college and also living expenses. But I also contributed by having a merit based scholarship that I needed to maintain a certain grade point to keep, as well as working in summers and a very small amount during the semester for $. The scholarship I had disbarred me working more than 4 hours a week, which basically excluded almost all jobs other than say tutoring, because the school felt that the academic rigor was more important than work study. College was some of the best years of my life and no I would have never considered not taking it seriously even though I didn't have debt over my head. So it really depends. I also have a PhD but went into a field where the university pays for the degree, plus additional amount of financial aid to live on, so I graduated with a small (5K) amount of debt that was paid off in 6 months.

When I was married, my ex and I agreed that it was important to pay the majority of school costs for oldest, and 2 years of community college for youngest (they have different needs/interests). What was frustrating is "how" actually doing it, kept being deferred, other than a nominal (less than 10K) amount in a 529. Now that oldest is a senior, and filling out applications, I realize that, it's on me! While the divorce decree specifies that we will split educational expenses, he doesn't have any money and has already essentially said he can't pay anything.

I let my daughter know, I am committed to paying the parental portion of financial aid, (8-10K range), and the rest she will need to pay for herself. It's not what she wanted to hear. And, not what we said previously, but divorce changes things. I've also brought up the idea of attending a community college for 1-2 years and transferring. Which she is not excited about, but hasn't rejected outright.
If I had the money I would have no problem paying for 100% of her basic costs as she is a decent responsible kid and I know how difficult it is to both work and go to school at the same time. Having stress about paying off big college loans does not "add" anything to the college experience. 
« Last Edit: March 25, 2021, 03:45:16 PM by partgypsy »

Car Jack

  • Handlebar Stache
  • *****
  • Posts: 1925
Re: Kids and College-Will you pay?
« Reply #120 on: March 26, 2021, 07:42:39 AM »
I have a LOT of experience in this from both the student and parent perspective.  Maybe I should make a chapter book.

Me:  I was going to go in the Navy after high school into an electronic tech program.  At the time, I would do 1 year, 6 month service and 6 months training.  Then the war ended (Viet Nam).  The minimum went up to 4 years.  Not interested.  So last minute, I signed up for community college.

@ community college: I paid my own way ($200 per semester) and commuted.  I had no desire to move on to a 4 year school.  Got the degree, only after having quit to work at my ski shop, but fired due to moonlighting at another shop where former manager worked. So back to school, degree and worked.  As I was working, I realized I easily picked things up and decided to give night school a try.  Some company tuition re-embersement, but some from me and I had to front the money.  Decided I could do it an quit and went back full time. 

@ bachelor's degree college:  Private college and again, I was paying my own way, having sold everything I owned except one car, my stereo set up and my guitar.  I was really motivated, with the philosophy that if I didn't pass a class, not only would I have to take it again, but that money was coming from my bank account again.

@ bachelor's degree part 2.  Before the first semester was done, I could see that engineering school at this college (primarily a business and law school) was easy.  I applied and transferred to a top regional private engineering school.  First thing to know.....when you transfer, you get ZIP for merit aid and likely ZIP for any aid.  Paid my way there, running out of money and doing an 8 month co-op.  Took one night class during this time to progress to graduation.  Graduated with Honors and left with $0 in my checking account.

For my son, I really, really value education.  He didn't do well freshman/sophmore year in high school because he had decided he was going to be a professional skateboarder.  Finally figured out that the pro skateboarder who ran the local indoor skate park was driving a used Dodge Neon that his aunt gave him and didn't have much of a life beyond trying to stay above water.  So anyways, this meant he started college at a mediocre place.  He did very well and I had told him that if he did really well and wanted to go to a better college and got in, I'd pay for it.  Well, he did.  Went to my Alma Mater.  Cool story....being a transfer, he got zero aid.  Started at $60k a year and by the time he graduated, was $70k.  I paid it all besides Stafford loans. 

An aside:  I hear Bogleheads always say "You can get student loans but you can't get loans for retirement".  Ok, well, show me what loans besides Staffords a student can take out without a parent co-signing.  There are none.  So no.....a student can't go to school on loans on their own.

Altogether, I paid about $300k for him which was well below what I budgeted.

EngineerOurFI

  • 5 O'Clock Shadow
  • *
  • Posts: 72
  • Location: Texas
Re: Kids and College-Will you pay?
« Reply #121 on: April 12, 2021, 09:34:27 AM »
We plan to cover 4 years of the cost of Public in-state tuition, room and board, as well as basics such as cell phone, transportation costs, and medical.

If they decide to go to private school - then hopefully they have scholarships to cover the difference.  If they want to live off campus in an expensive fashion, we'll cover the same amount as a standard dorm cost at said in-state public university levels and anything extra is on them.

If they need 5 years - 5th year is on them.  But we would be doing some handholding along the way to make sure that they have a clear, achievable plan to get out in 4 years.  And they should be leaving High School with a pretty large amount of credits that would honestly allow them to do one major change and still graduate in 4 years - so this really should be a non-issue.

We recognize that doing this pushes back retirement date and we are completely okay with that.

We might consider pitching in to help with graduate school - but honestly that's going to depend on how financially well off we are at the time and on if we perceive the graduate school to be a good ROI.  We won't stop a kid from picking a Bachelor's or Graduate field of study of their choice, but obviously if they want to get a Master's in underwater basket weaving...that's not something we intend to help with.  But if they kicked ass in pre-med and have wanted to be a doctor for forever, and killed the MCATs ...yeah we might pitch in small amounts to help with med school.  However, we would have to be clearly financially well off enough to aid in any capacity and we would likely give equal amounts to the other child in the form of perhaps aid on a down payment on their first house or something to make sure it's equitable between kids.  But honestly, they should have their own business plan to make med school create a ROI (e.g. I'm going to study XYZ and make $A as soon as I graduate so I can pay back $B in student loans over Z years. 

Requirements of kids to receive college support from us (parents):
  • Going into college, have a clear plan on major and be able to clearly articulate potential career paths, salaries for said career paths, locations/hotspots for jobs for said career paths, and present a rough budget of what life would look like on said career path.
     If you want to study musical theater and get a BFA in musical theater - fine - but understand that you're likely either going to live 6 people to an apartment in NYC while working as a barista and attending casting calls on Broadway before moving back home and becoming a Theater teacher making $55k a year.  If you're going to study pre-law and go to law school - great but understand that to make big bucks in law you have to get into a top-tier school and get top-tier LSAT scores and work at big law etc.  Or whatever.
     Just want to make sure they understand ramifications of their major selection.
  • Research and apply for scholarships like hell and maintain grades/requirements of scholarships.
  • Maintain excellent grades.  They don't have to work if they're maintaining excellent grades and active somehow in the school (programs such as ASME or whatever groups to help with networking etc.)
  • Do something in every summer (internships, more classes, something of substantive real value).  I learned internships are incredibly valuable and will be pushing very hard to make sure they do 2 internships.  Note this "do something" in the summer rule will apply long before college.  Middle school, Junior High, and High School kids need to be learning or doing something in the summer.  Couple weeks of lazying around in the summer is great but 3 months is overkill.
  • Haven't figured it out yet, but there will be some kind of a financial agreement where basically since I'm paying for college and they don't have to take on loans, they agree to share their personal budget (can be a high enough level that I don't see any personal details of their life) for X period of time after graduation and they will prove they are saving $XXX minimum per month or Y% of salary towards retirement - which they should be able to easily afford since they don't have personal loans.
  • Make sure they have a really clear understanding of the massive cost of university and how much we (the parents) are sacrificing to help.  And an understanding of how huge their student loans would be or how much smaller their average earning potential would be without our help.  I think instilling the value of a dollar in kids comes long before they are 18 and heading off to college, so hopefully we achieve this goal before this point.  Probably will even tie in the point that they should honestly consider a paid education as a large part of their inheritance (which it may be depending on how early we retire and how the market treats us).

« Last Edit: April 12, 2021, 09:40:01 AM by EngineerOurFI »

Dee_

  • Stubble
  • **
  • Posts: 212
  • Location: Podunk, Midwest
Re: Kids and College-Will you pay?
« Reply #122 on: April 12, 2021, 08:15:26 PM »
We can't fill the science-and-math related careers with American-born graduates anymore. 

This isn't really true.

For a company in the USA to hire a foreign national, they generally have to sponsor a H1-B visa. Getting an H1-B approved requires arguing that the job is either so specialized or an individual's training is so unique that they can't find enough qualified Americans to fill the job.

Getting a company to sponsor an H1-B for a run-out-of-the-mill undergrad engineering job is basically impossible, because there's tons of bright eyed US engineers eager for a job. I have only ever seen H1-Bs issues for PhD level jobs - professorships and research scientists at IBM, etc. There's a lot more foreign nationals in those jobs for a pretty simple reason - US born students have better options than doing a PhD. The opportunity cost of doing a PhD for (say) a mechanical engineer fresh out of undergrad is about 250k. It just doesn't make sense to do a PhD, unless you want a job that requires one (or you can't find a job, but that's a slightly different story).

jeninco

  • Handlebar Stache
  • *****
  • Posts: 2380
  • Location: .... duh?
Re: Kids and College-Will you pay?
« Reply #123 on: April 14, 2021, 05:22:46 PM »
We plan to cover 4 years of the cost of Public in-state tuition, room and board, as well as basics such as cell phone, transportation costs, and medical.

If they decide to go to private school - then hopefully they have scholarships to cover the difference.  If they want to live off campus in an expensive fashion, we'll cover the same amount as a standard dorm cost at said in-state public university levels and anything extra is on them.

If they need 5 years - 5th year is on them.  But we would be doing some handholding along the way to make sure that they have a clear, achievable plan to get out in 4 years.  And they should be leaving High School with a pretty large amount of credits that would honestly allow them to do one major change and still graduate in 4 years - so this really should be a non-issue.

We recognize that doing this pushes back retirement date and we are completely okay with that.
FYI, many colleges are no longer giving credit for most AP classes. If you look into how AP tests are scored (or if you consider the fact that 9th graders take "AP Human Geography", which sort of automatically makes it not really a "college-level class") you'll see why.

We might consider pitching in to help with graduate school - but honestly that's going to depend on how financially well off we are at the time and on if we perceive the graduate school to be a good ROI.  We won't stop a kid from picking a Bachelor's or Graduate field of study of their choice, but obviously if they want to get a Master's in underwater basket weaving...that's not something we intend to help with.  But if they kicked ass in pre-med and have wanted to be a doctor for forever, and killed the MCATs ...yeah we might pitch in small amounts to help with med school.  However, we would have to be clearly financially well off enough to aid in any capacity and we would likely give equal amounts to the other child in the form of perhaps aid on a down payment on their first house or something to make sure it's equitable between kids.  But honestly, they should have their own business plan to make med school create a ROI (e.g. I'm going to study XYZ and make $A as soon as I graduate so I can pay back $B in student loans over Z years. 
We both went to graduate school in a technical field, and our experience is that grad school should pay for itself (in real time, through TA-ships and RA-ships). We understand this doesn't work in some fields...


Requirements of kids to receive college support from us (parents):
  • Going into college, have a clear plan on major and be able to clearly articulate potential career paths, salaries for said career paths, locations/hotspots for jobs for said career paths, and present a rough budget of what life would look like on said career path.
     If you want to study musical theater and get a BFA in musical theater - fine - but understand that you're likely either going to live 6 people to an apartment in NYC while working as a barista and attending casting calls on Broadway before moving back home and becoming a Theater teacher making $55k a year.  If you're going to study pre-law and go to law school - great but understand that to make big bucks in law you have to get into a top-tier school and get top-tier LSAT scores and work at big law etc.  Or whatever.
     Just want to make sure they understand ramifications of their major selection.
I want to point out that this is ... asking a LOT from a 17-year old. Our now-20-year old has already changed majors once, because he got there, took a few semesters of classes, and realized he didn't love (field) as much as he thought he would. Which should be OK! I'd argue that most adults don't really understand the whole "Career-path" thing, and expecting it from an older teen seems developmentally inappropriate. And do you really want to lock them into a career path that they know they hate from the second semester?

  • Research and apply for scholarships like hell and maintain grades/requirements of scholarships.
  • Maintain excellent grades.  They don't have to work if they're maintaining excellent grades and active somehow in the school (programs such as ASME or whatever groups to help with networking etc.)
  • Do something in every summer (internships, more classes, something of substantive real value).  I learned internships are incredibly valuable and will be pushing very hard to make sure they do 2 internships.  Note this "do something" in the summer rule will apply long before college.  Middle school, Junior High, and High School kids need to be learning or doing something in the summer.  Couple weeks of lazying around in the summer is great but 3 months is overkill.
  • Haven't figured it out yet, but there will be some kind of a financial agreement where basically since I'm paying for college and they don't have to take on loans, they agree to share their personal budget (can be a high enough level that I don't see any personal details of their life) for X period of time after graduation and they will prove they are saving $XXX minimum per month or Y% of salary towards retirement - which they should be able to easily afford since they don't have personal loans.

This should be unnecessary if you teach them to save as soon as they have summer jobs. We offer Roth matches to our kids, to incentivize this.  We also talk about spending less then we're making, the power of compound interest and passive investing, and model responsible financial decisions.

  • Make sure they have a really clear understanding of the massive cost of university and how much we (the parents) are sacrificing to help.  And an understanding of how huge their student loans would be or how much smaller their average earning potential would be without our help.  I think instilling the value of a dollar in kids comes long before they are 18 and heading off to college, so hopefully we achieve this goal before this point.  Probably will even tie in the point that they should honestly consider a paid education as a large part of their inheritance (which it may be depending on how early we retire and how the market treats us).

Agreed. Full freight at a top-tier university, should that be a good choice for your child, is a hell of a lot of money. It's good to tell your kid you'll pay for the best school they can get into and want to attend (if that's the case) but it also doesn't hurt to point out that it's a LOT of money.

ToTheMoon

  • Pencil Stache
  • ****
  • Posts: 677
  • Location: BC
Re: Kids and College-Will you pay?
« Reply #124 on: April 15, 2021, 09:00:34 AM »
Holy necro-post!

I would love to see updates from any of the original posters (from almost 10 years ago) to see what they ultimately decided, and if opinions have changed now that a decade has gone by!

EngineerOurFI

  • 5 O'Clock Shadow
  • *
  • Posts: 72
  • Location: Texas
Re: Kids and College-Will you pay?
« Reply #125 on: April 18, 2021, 02:20:45 PM »
@jeninco Understood on AP classes and obviously we’d make sure whatever they take is relatively universally accepted - our high school offers a ton of options and kids have credits accepted everywhere from MIT to top in-state public schools.  My larger point is simply that they’ll likely have a ton of college credit going into college - just like my wife and I or frankly like any of my wife’s students who are graduating high school now.

If our kids want/need to change majors multiple times - that’s fine.  Have at it.  Our thing is we’re just paying for four years. If they find a new passion and want to switch majors, they can take more hours or summer school to fit it in four years or they can extend another year at their own cost.  I don’t see what’s unreasonable about that.  If they truly love this new major surely it’s worth one year of student loans considering the rest of college including housing, food, cell phones, transportation, clothes, etc is 100% covered?  I encourage switching major if you find you love something more but there’s also no rule book saying I should pay for more than four years.  This is my parental incentive to make sure kids know there’s a timeline to the parent-wallet connection.  I think with high school credits, summer school covered by parents, and some work ethic on part of kid - they could honestly change major twice in first two years and still finish in 4 years.  But, again, if they have to take out one year worth of student loans to fund switching major......I think they’re still in an extremely enviable position relative to most folks.  Especially since I’m sure I would be covering transportation, cell phone, and medical for year 5.
« Last Edit: April 18, 2021, 02:25:51 PM by EngineerOurFI »

TheFrenchCat

  • Bristles
  • ***
  • Posts: 339
Re: Kids and College-Will you pay?
« Reply #126 on: April 18, 2021, 03:03:24 PM »
@jeninco Understood on AP classes and obviously we’d make sure whatever they take is relatively universally accepted - our high school offers a ton of options and kids have credits accepted everywhere from MIT to top in-state public schools.  My larger point is simply that they’ll likely have a ton of college credit going into college - just like my wife and I or frankly like any of my wife’s students who are graduating high school now.

If our kids want/need to change majors multiple times - that’s fine.  Have at it.  Our thing is we’re just paying for four years. If they find a new passion and want to switch majors, they can take more hours or summer school to fit it in four years or they can extend another year at their own cost.  I don’t see what’s unreasonable about that.  If they truly love this new major surely it’s worth one year of student loans considering the rest of college including housing, food, cell phones, transportation, clothes, etc is 100% covered?  I encourage switching major if you find you love something more but there’s also no rule book saying I should pay for more than four years.  This is my parental incentive to make sure kids know there’s a timeline to the parent-wallet connection.  I think with high school credits, summer school covered by parents, and some work ethic on part of kid - they could honestly change major twice in first two years and still finish in 4 years.  But, again, if they have to take out one year worth of student loans to fund switching major......I think they’re still in an extremely enviable position relative to most folks.  Especially since I’m sure I would be covering transportation, cell phone, and medical for year 5.
This seems reasonable to me.  I changed majors twice, and between AP credits, one summer class and taking 6-7 classes most semesters, I finished in three years.  Four years is often doable with a less insane course load, even if you change majors. 

Laura33

  • Magnum Stache
  • ******
  • Posts: 2921
  • Location: Mid-Atlantic
Re: Kids and College-Will you pay?
« Reply #127 on: April 21, 2021, 10:48:55 AM »
@jeninco
If our kids want/need to change majors multiple times - that’s fine.  Have at it.  Our thing is we’re just paying for four years. If they find a new passion and want to switch majors, they can take more hours or summer school to fit it in four years or they can extend another year at their own cost.  I don’t see what’s unreasonable about that.  If they truly love this new major surely it’s worth one year of student loans considering the rest of college including housing, food, cell phones, transportation, clothes, etc is 100% covered?  I encourage switching major if you find you love something more but there’s also no rule book saying I should pay for more than four years.  This is my parental incentive to make sure kids know there’s a timeline to the parent-wallet connection.  I think with high school credits, summer school covered by parents, and some work ethic on part of kid - they could honestly change major twice in first two years and still finish in 4 years.  But, again, if they have to take out one year worth of student loans to fund switching major......I think they’re still in an extremely enviable position relative to most folks.  Especially since I’m sure I would be covering transportation, cell phone, and medical for year 5.

I think this is also where knowing your kid becomes important.  My DD is one of those kids who needs to have a plan, and once she is set on that plan, it takes a lot to get her to move off of it, because she views it as failing.  So I have been very surprised to find myself telling her that she doesn't have to stay on a particular career path just because she decided on it at age 7, that it's ok to change to something that suits her better and doesn't kill her, that she can transfer or change majors or whatever she needed, and that we had her back through it.* 

OTOH, my brothers were definitely of the "need a swift kick in the ass" variety and would have been better served had my dad put some limits on things. 

tl:dr:  It's great to have a plan to address college.  But don't be afraid to change it based on your kids' needs.


*None of which I ever thought I'd be saying for the first @18 years of her life!  But by the time she hit freshman year, she had morphed into this kid who wanted to double major in engineering + biology, AND satisfy all the premed requirements.  As you can imagine, she was incredibly stressed trying to figure out how to fit it all in, and she needed a lot of hand-holding to realize it was ok to do engineering OR med school. 

Car Jack

  • Handlebar Stache
  • *****
  • Posts: 1925
Re: Kids and College-Will you pay?
« Reply #128 on: April 21, 2021, 12:01:56 PM »
We can't fill the science-and-math related careers with American-born graduates anymore.   

I know I'm picking one line from a very long post.  Sorry for that.  I saw this quoted and just had to chime in.

I'm an engineer with a graduate degree.  I've worked as an engineer for 36 years.  In that time, I have seen plenty of engineering positions filled with qualified US citizen engineers.  I've seen H1B positions opened and seen the justification (we can't find a qualified US citizen candidate) and in every single case, the justification was bullshit.  There are plenty of candidates either looking for a job or who could be poached from a competitor.  What the employer really means is "We can't find a US citizen engineer to fill this position for 1/3 the going rate".  I've talked with the very qualified foreign engineers who ended up being hired.  I know what they made.  In some cases PhD level engineers from Eastern Europe, well educated and with a track record and pile of publications were making 1/3 what I made (Masters degree).  And of course, they become indentured to the employer and if they want to leave, they need a new sponsor employer or they're shipped back out of the country.  Sorry.  In my opinion, the H1B program should be completely revamped in such a way that a true salary is determined by the government for an equal US citizen.  Then the employer should have to pay 110% of that to bring in someone from outside the US since they're saying they can't find anyone.  Guess how many H1B engineers are going to be hired?  It'll be zero.  If they can't save big money, they'll simply pay market rates and easily hire exactly who they need.

EngineerOurFI

  • 5 O'Clock Shadow
  • *
  • Posts: 72
  • Location: Texas
Re: Kids and College-Will you pay?
« Reply #129 on: April 21, 2021, 08:46:20 PM »
We can't fill the science-and-math related careers with American-born graduates anymore.   
I've seen H1B positions opened and seen the justification (we can't find a qualified US citizen candidate) and in every single case, the justification was bullshit.

I'm also a manager who has yet to see a H1B position that wasn't opened to save a boatload of money.  There was always a US Citizen option.....it just always happened to be way more expensive.

rab-bit

  • Stubble
  • **
  • Posts: 249
  • Location: Western PA
Re: Kids and College-Will you pay?
« Reply #130 on: April 22, 2021, 06:52:32 AM »
We plan to cover 4 years of the cost of Public in-state tuition, room and board, as well as basics such as cell phone, transportation costs, and medical.

If they decide to go to private school - then hopefully they have scholarships to cover the difference.

This is what we did.

DD (older child) chose to go to a out-of-state public school and was able to cover the difference (compared to our in-state school) with financial aid and part-time jobs (including one year as an RA). DS went to an in-state school and we paid for everything. So both kids were able to complete their undergraduate degrees with zero debt.
« Last Edit: April 22, 2021, 06:55:13 AM by rab-bit »

dabighen

  • 5 O'Clock Shadow
  • *
  • Posts: 80
Re: Kids and College-Will you pay?
« Reply #131 on: May 16, 2021, 10:23:49 AM »
Our strategy is to do this too.  We will cover up to what an in state school costs.  If they want to go somewhere else, they need to make up the difference.

I think a degree, while certainly worthwhile, really only gets you your first job.  After that your productivity and experience take over and nobody cares where you went.

My wife, a teacher, and myself, a planner, both went to in state schools and went on to successful careers and I think going to a state school actually helped us more than it hurt us because the networks within the state are all connected with the state institutions anyway.

Botany Bae

  • Pencil Stache
  • ****
  • Posts: 751
  • Location: PNW
  • Just another dharma bum
Re: Kids and College-Will you pay?
« Reply #132 on: May 16, 2021, 11:48:15 AM »
TL;DR at the end. I'm going to share because not everyone has the ability to pay for their kids college and fund their own retirement, but that doesn't mean it can't be done without debt.

I didn't post on this thread way back then, but I remember reading it (or a similar post) during my lurking days. Our eldest graduates this fall, and this is what we did. Keep in mind, we are low income so we had some of those "benefits."

We do not pay for college, in part because we have a lower income and simply can't responsibly do so. Our children are aware of this from a young age, and they are also aware of our high value of an education.

In 7th grade we applied for the College Bound scholarship. This is open to all children in WA state if their parents earn below a certain income threshold.

He started college at 16 at a community college. He had no idea what he wanted to do with his life, really. Fortunately, he was going under our state's Running Start program, which is open to all high school students. We began playing up this program to him in middle school, so he was actually excited for it and working toward the full time entry requirements from about 8th grade onward. One way we played it up was that by having a 2 year head start on college, he could take a gap year without falling behind his peers. Or, he could just be done with school at 1, but with the benefit of an Associate degree, and then go into a trade or certain other career options.

His tuition was covered by the state, and he went to college full time in lieu of his Junior and Senior years of high school. He graduated high school with an Associate of Arts degree. Tuition coverage did not cover books and class fees, so we paid <$1,000 over two years for these. At the time he was thinking of being an art major (I know, I know), so he filled up electives with art classes. We discouraged nothing, he needed to find himself in his own way, and he would be the one living with his choices not us. He applied for and was granted a small department grant that covered all those expensive art supplies, at least.

He maintained a 4.0 GPA throughout community college and was accepted into the PTK honor society (Cost $75 in one time dues). He did a lot of volunteer work with the society, which was good for him, for his future resumes and scholarship apps, and for the community. It also surrounded him with the "right" type of peers to help him stay focused on school. This also lead to two scholarships - an automatic $1500  for the school he chose, and another $5000 annual scholarship he applied for and received through the society.

He applied to and was accepted to his first choice in-state university. He briefly looked at some private art schools, but decided the amount in loans was scary. He instead decided to go with the state school and perhaps revisit a desired private school in the event he decided to do grad school later. This was a biggie, since unbeknownst to him at the time his goals would quickly change.

At the state school he qualified for enough Pell Grants, state need grants, and work study to fully pay his tuition and cover most of his dorm/book costs, when combined with his three small scholarships. He was short $500 his first quarter, which we decided to cover. His work study would supply his daily living costs, since he was paid twice a month. He interviewed for the onsite Pre-K and Kindergarten as a student aid, and was given the position on the spot. This was in part due to his impressive high school resume - much of his volunteer work at the CC was with a USDA and Farmer's Market nutrition program for kids. This school is a Montessori and Emilio-Reggio inspired school. He also did his portfolio review and was accepted to the art major.

One quarter in and he enjoyed his job so much he switched to an art education major. In spring quarter, the Pre-K shutdown due to Covid. He was such a good worker, though, that he was given the same opportunity as the teaching staff - to work on additional certifications online for pay through the end of the quarter. He did every certification available to him, while going to school full time online. He also moved out of the dorms and moved across the state to stay with his partner and help out his grandmother through the early days of the pandemic. He got a summer job at wal-mart with his partner, and they saved every cent they made (plus the dorm refund), since they were living for just the cost of food and chores in a family member's home. They moved back in fall to a cheap off-campus studio apartment so he could resume his teaching job. Classes remained online.

He decided to change his major again -- this is why it's good that we made it financially challenging to choose the art school, an unintended benefit! He switched to education with an anthropology minor. Thus the need for an extra quarter - he needs it for his final certification time. Fortunately, two of his first year scholarships renewed and he got two more honor scholarships of less than $1000, and the amount of scholarships and Pell grants covers all of his tuition, books, and fees, along with most of his half of the apartment and living expenses. He is still on work study at the school through the end of spring quarter, but he has been hired on for the summer as a full time assistant teacher. He has also been offered the job of a full time junior teacher once he graduates. Most of this became available because he took the opportunity to do those extra certifications last spring (and his students adore him)!

He will be graduating without any debt and only ~$1500 parental help. He did take out a $5000 student loan in the fall. He was worried of the school closing down again and being stuck with no work study and a lease. He repaid in full at the beginning of April once he had enough savings to carry him six months. It cost nothing since student loan interest was paused. We also gave him his portion of the last two stimulus payments, since they paid it out to us and not to him because of his age and because he was a dependent for the first half of 2020. He also was automatically given some student stimulus money that the university paid out to all students based upon their need VIA FAFSA.

He and his partner are savers. When the lease renewed, it was going up almost $100 (to go into effect after the rent hike moratorium ended). He went down and bargained it back down so it only will go up $10. That kid has balls -- their excuse was water/sewer increases and he actually looked up the cost and estimated their average water use and used that as his bargaining chip to negotiate it down!

TL;DR We didn't pay for college and our kids always knew we wouldn't. We did promise to help them in any other way possible to reach their goals with little to no debt. Kid #1 is graduating soon with 0 debt and over $10k in savings. He has a $32,000/yr entry level job lined up that has the benefit of tuition reimbursement. He's planning to go to grad school, so that is a biggie. His partner, soon-to-be spouse, is also planning to finish a degree at this institution. There are tuition benefits for family as well, so this will save them even more money in the future.

If we had provided a full ride, or maybe even a partial ride, the kid likely would have ended up in an expensive art school taking on lots of debt, or at least not really discovering what his calling was at a state school. Having to work for everything, even with lots of parent support in negotiating opportunities and dealing with paperwork/bureaucracy, means at age 21 he will have a career and a nice financial start to the rest of his life.

There is more than one way to do this. My 16 year old younger son is choosing a different path, as he doesn't want to do Running Start full time and is instead considering a clean energy engineer program at a local tech college instead. We will probably convince him to get his English and math requirements out of the way via Running Start so that he doesn't have to pay for those at the tech school. We will then help him piece together a financially viable plan for this, as well. Unlike his brother, his plan is to live at home during college, so that will also save some money.
 


MaybeBabyMustache

  • Magnum Stache
  • ******
  • Posts: 3757
    • My Wild Ride to FI
Re: Kids and College-Will you pay?
« Reply #133 on: May 16, 2021, 12:01:33 PM »
Hello, old thread! We are both high wage earners (I plan to FIRE next year) & hope to have a paid off house, fully funded retirement accounts, & quite a bit of investments by the time the kids have graduated college, so they will be eligible for zero aid, minus merit. That is unlikely to be an option for at least one of my kids.

We have a 14 & 15 year old, so this is top of mind for us. Our 15 year old has ADHD, and high school (particularly remote) has been a huge struggle. He's academically gifted, but will likely need to start at a community college (both because of expected grades, and the need to emotionally mature & develop more executive functioning skills). Given how California handles community college & four year schools, we have enough to fully fund this, and all associated costs. College is going to be challenging for him, and we are comfortable with him taking time off to mature more, to provide coaching/tutoring/support as he goes along, so he can continue to develop the right skills. Our goal right now is to help him maintain all available options, so we can help him evaluate what makes the most sense once he's graduating.

My 14 year old is an entirely different animal. He will likely earn merit scholarships & is quite athletic. He has zero desire to play sports in college, but should he choose to, he has at least enough potential to give it a fair shot. We are all universally against an athletic scholarship, mostly because we have enough money to fund college, and would like him to focus on the academics & experience of college. If he chooses to play a sport, fantastic, but we want him to be able to quit at any time, should athletics get in the way of school. He is a very self motivated individual, in everything he does. My husband would prefer for him to go to a CA school, because it's so much more inexpensive. That said, if he works hard & continues to manage his life well & has a clear plan, I'm comfortable paying for him to go to other schools.

We will expect both of our kids to work summer jobs, to earn & save money. That can be their flexible spending money, and we will match whatever they earn for their retirement accounts. We do want them to have skin in the game, but it's clear that grade based expectations may not always be in the cards for my 15 year old.

Parenting these two wildly different kids has certainly made us rethink a lot of our original plans, and also our expectations that we could heavily influence the outcome, through our parenting & raising of the kids. Life has a lot of surprises that way. :-)

shelivesthedream

  • Walrus Stache
  • *******
  • Posts: 6799
  • Location: London, UK
Re: Kids and College-Will you pay?
« Reply #134 on: May 16, 2021, 01:20:47 PM »
What an interesting thread. Our eldest is only three, so a lot could change in the next fifteen years, but our plan is to offer a set amount of money to each child. However, it won't just be for university. It would be a more general "launch fund" that could be used for a small number of approved purposes, or invested to grow (in a small number of approved investments). At the moment we are thinking higher education or a house deposit but additional approved purposes may occur to us. We haven't thought it through fully.

I doubt we will be able to cover the full cost of university (even in the UK!) even if we wanted to but I deeply approve of the model whereby you say upfront what's on offer and they're on the hook for more but can keep any leftovers. You can set the level of what's on offer at any amount, so it's easy to offer enough to cover the full cost or to force them to work to earn the rest. And you can point out what different options would mean if tuition fees are different in different places. But to me, the incentive of having leftover money vs having to work alongside IS skin in the game, even if you end up covering the whole cost because they choose somewhere cheap and live frugally.

I'm not especially interested in financially incentivising getting a university degree. I went to university just because my parents said they'd pay for the whole thing, and while I met Mr SLTD there and got a 2.i, I don't think it was the best choice for me given my interests and aptitudes at the time. I want to support my children to launch, but I see no point in saving thousands of pounds in a university fund and then being left with it because they decide not to go.

brandon1827

  • Bristles
  • ***
  • Posts: 347
  • Location: Tennessee
Re: Kids and College-Will you pay?
« Reply #135 on: May 27, 2021, 12:02:27 PM »
I'm enjoying reading everyone's takes on how to approach this issue. I think my wife and I, after both having to put ourselves through college with student loans, will do as much as possible to ensure our son doesn't have to enter adulthood with debt like we did. He's just 11, but at this point he still does not enjoy school outside of the social aspects. He easily maintains A-B grades in every subject, but just absolutely hates school. For this reason, I have huge doubts about whether he will choose to go to college, or go a different route. We are saving anyway, and if he decides to look for work or enroll in a trade-school instead of a traditional 4-year university, he will be getting as much financial help as we can offer in whatever form that ends up taking. We will begin financial education at home over the next year or so...slowly introducing concepts to him that were never taught to us as kids...so that he can go into life with open eyes about how the financial systems work in our country. Outside of that, we will support him no matter what path he takes, knowing that we will be spending the years between now and high school graduation trying to instill a solid work ethic and educating him on his options and their potential risks/rewards.

CindyBS

  • Bristles
  • ***
  • Posts: 462
Re: Kids and College-Will you pay?
« Reply #136 on: May 28, 2021, 10:11:52 AM »
What an interesting thread. Our eldest is only three, so a lot could change in the next fifteen years, but our plan is to offer a set amount of money to each child. However, it won't just be for university. It would be a more general "launch fund" that could be used for a small number of approved purposes, or invested to grow (in a small number of approved investments). At the moment we are thinking higher education or a house deposit but additional approved purposes may occur to us. We haven't thought it through fully.


This is exactly what we did and I am so happy we did not do a bunch of contributions to a 529 fund (college savings fund with tax benefits) and tie up our money in it. 

Our kids have a launch fund that we agreed could be spend on start of life expenses that we approve of - college/vocational training, practical first car, Security deposit/rent for first apartment, downpayment for a house, etc. - but NOT beer, hanging out, fancy cars or I don't feel like working money.   All payouts from launch fund are completely dependent on working, gong to college, or otherwise making forward progress and the kids have been told they are to move out of our house by age 23 at the latest.  If traditional college is skipped, some sort of job training for a job that pays a living wage must be obtained. 

My oldest is graduating HS this month. He is not going to college, but instead took a vocational program in school for IT.  He has a summer job in IT and then is planning to get a career type job in the fall with the plan to move out of our house in the next 18 months.  He is open to going to college if he has to, but I suspect he won't. He is thinking of buying a condo or small house with a significant down payment from his launch fund by age 21-22.

My youngest (in High School now) does not know if he is going to college either and may follow in the footsteps of his older brother.  He is interested is using part of his fund to get his first car next year. 

We told both kids the exact amount of money they would get right before their first year of High School (age 14 here) and explained opportunities for free college credit and/or vocational training in high school.

The kids are pretty pleased with this arrangement thus far.

jeninco

  • Handlebar Stache
  • *****
  • Posts: 2380
  • Location: .... duh?
Re: Kids and College-Will you pay?
« Reply #137 on: May 28, 2021, 10:18:21 AM »
Coming back to add this:
Our youngest has been very seriously playing an instrument since he was 9 or so, and has just finished his junior year. We're encouraging him to look at double majoring, even if it takes 5 years (he's also very interested in the place where computer science meets electrical engineering). Meanwhile, MrInCO and the kid have been looking at schools, and reading about the audition process to get into music performance programs... and MrInCO was telling me about at article he was reading from a women who got a music performance degree and then went into business, talking about all the benefits she thinks she got from the degree ("grit" and "persistence" were high on the list.) I listened (mostly) politely, and we went to bed.

And then I woke up at 3 am, rolled over, and said to him "$15K. That's how much interest you accrue per year on $300K of loans at 5%. Are you really going to make the case that a degree that doesn't even teach you how to write, or do math, and probably won't lead to a job in the field is going to lead to a position where you can pay $15K in interest alone, just to keep the principal from growing?"

I mean, I hate to be all "ROI", but for heaven's sake -- there's a point where "pursue what you love" has to meet reality, people!

shelivesthedream

  • Walrus Stache
  • *******
  • Posts: 6799
  • Location: London, UK
Re: Kids and College-Will you pay?
« Reply #138 on: May 28, 2021, 11:22:28 AM »
@CindyBS Thanks for posting that. It's so interesting to hear not just what people plan to do, but what decisions their children make within the parameters of the plan. It sounds like your eldest has made totally reasonable choices so far, and that the launch fund will be a real boost.

DadJokes

  • Handlebar Stache
  • *****
  • Posts: 2086
Re: Kids and College-Will you pay?
« Reply #139 on: June 01, 2021, 10:43:58 AM »
Posting to remember to come back and read through responses.

Our child is 2.5, and we have not yet decided what we plan to do. I'm not putting money in a 529 either way, as we will be able to pay out of retirement accounts whatever we do end up paying.

We do plan to be retired early enough that we'll be able to keep our SAI (new FAFSA term) low. If we can also pay off our house, even better!

shelivesthedream

  • Walrus Stache
  • *******
  • Posts: 6799
  • Location: London, UK
Re: Kids and College-Will you pay?
« Reply #140 on: June 01, 2021, 02:13:57 PM »
What an interesting thread. Our eldest is only three, so a lot could change in the next fifteen years, but our plan is to offer a set amount of money to each child. However, it won't just be for university. It would be a more general "launch fund" that could be used for a small number of approved purposes, or invested to grow (in a small number of approved investments). At the moment we are thinking higher education or a house deposit but additional approved purposes may occur to us. We haven't thought it through fully.

I doubt we will be able to cover the full cost of university (even in the UK!) even if we wanted to but I deeply approve of the model whereby you say upfront what's on offer and they're on the hook for more but can keep any leftovers. You can set the level of what's on offer at any amount, so it's easy to offer enough to cover the full cost or to force them to work to earn the rest. And you can point out what different options would mean if tuition fees are different in different places. But to me, the incentive of having leftover money vs having to work alongside IS skin in the game, even if you end up covering the whole cost because they choose somewhere cheap and live frugally.

I'm not especially interested in financially incentivising getting a university degree. I went to university just because my parents said they'd pay for the whole thing, and while I met Mr SLTD there and got a 2.i, I don't think it was the best choice for me given my interests and aptitudes at the time. I want to support my children to launch, but I see no point in saving thousands of pounds in a university fund and then being left with it because they decide not to go.

I've realised (duh!) that the US offers tax advantages to saving specifically for college (I think? I mean whatever a 529 is) that the UK doesn't offer. So even if we were planning to cover their full university costs, it would come out of a "regular" account, so we would have no penalty for not planning ahead what the money is being used for. We could plan to save it to buy them a Mercedes and then change our minds later on to pay for a roller disco for their 18th birthday and then change our minds later on to pay for university, and suffer no financial setback as a result. I appreciate now that this does change the playing field for people in the US (although I'm still not sure how much we're talking in actual $ if you saved in a 529 vs in another account - and whether it's worth the "risk" that your kids won't go to college and you will be stuck with a pile o' money you can't use...although this may not be what happens!

secondcor521

  • Magnum Stache
  • ******
  • Posts: 4128
  • Age: 52
  • Location: Boise, Idaho
  • Big cattle, no hat.
    • Age of Eon - Overwatch player videos
Re: Kids and College-Will you pay?
« Reply #141 on: June 01, 2021, 03:23:13 PM »
I appreciate now that this does change the playing field for people in the US (although I'm still not sure how much we're talking in actual $ if you saved in a 529 vs in another account - and whether it's worth the "risk" that your kids won't go to college and you will be stuck with a pile o' money you can't use...although this may not be what happens!

529s grow tax free and the proceeds are tax free if used for qualifying educational expenses (generally:  tuition, room and board, books, fees, internet/computer).  Depending on how much one is saving up, what kind of investments one chooses, the specific 529 plan, and how one would have invested in a non-529 plan, the difference could be almost nothing to tens of thousands of dollars.

If the kids don't go to college, then the 529 can generally be switched to another beneficiary in the family (younger sibling, grandchild, parent, cousin, etc.) or withdrawn.  Withdrawals have ordinary income taxes plus 10% penalty on the portion of the withdrawal that is attributable to earnings.  The 10% penalty can be avoided to the extent that the kid gets scholarships (and for other less common reasons such as death or attending a military academy).

There are also ESAs, which are another kind of tax favored account for education, but hardly anyone has those or uses those any more.

There are also a number of tax credits and deductions in the US related to undergraduate education.  The most common is the AOTC generally for undergrad and the LLC which is more often for continuing or graduate education.

la Condessa

  • 5 O'Clock Shadow
  • *
  • Posts: 47
Re: Kids and College-Will you pay?
« Reply #142 on: June 07, 2021, 08:05:32 AM »
I have no intention of giving my kids a free ride, even if I could, butI would very much like to be able to provide enough help to make working for the rest and graduating debt-free more attainable for them.  In addition to college, there are other costs that often come close together in that period for young adults in our religious subculture.  Here’s our plan for financial help with launching into adulthood:

-If our kids choose to serve religious missions for our church, we plan to offer to pay for enough of it that they will need to save $3,000 themselves to cover the rest.  This would mean a $9,000 contribution from us for the boys and a $6,000 contribution from us for the girls.  (Cost is $500/month, boys generally serve for 24 months and girls generally serve for 18 months.)

-Getting married young is very common.  Weddings are much more frugal than in general American society, $5,000 or so average cost, but can be much more or less.  If/when our kids choose to marry, we’d like to give them each some money to use towards their reception/honeymoon/house/savings/etc., their choice.  As brides’ families generally pay for the bulk of wedding costs, the plan is to give the girls $4,000 and the boys $1,000 at that time, bringing the total with mission cost help up to $10,000 each.

-My husband and I both attended a private religious university that offers exceptional value for cost.  In the interest of providing each kid the same amount of financial help and then letting them make their own choices how best to utilize it, we’d ideally like to offer them the amount of the cost of four years’ tuition at our Alma Mater for them to use at the college or other higher education institution of their choice.  This would be roughly half the cost of attendance at our school with living expenses factored in, far less at most other universities.  It would currently be $24,000 per student, though I expect prices will rise more before our kids reach that age.

I don’t know if this last will be an attainable goal, though.  We are still pretty early on our financial path with saving, and our current rates won’t cut it.  We have six years until the oldest is college age.  Hopefully we will make financial strides that allow us to put away more before then.
« Last Edit: June 07, 2021, 09:04:34 AM by la Condessa »

DadJokes

  • Handlebar Stache
  • *****
  • Posts: 2086
Re: Kids and College-Will you pay?
« Reply #143 on: June 07, 2021, 08:23:43 AM »
Each personality is so different its hard to predict the best way to teach work ethic and dollar values.

This is true, and completely how I felt until I read The Millionaire Next Door.

Check it out from your local library, and just jump to the chapter (near the end) on gifting money to your kids.  It's probably only 20 pages, will take you 30-60 minutes to read it.  In fact, you don't even have to check out the book then, just grab it off the shelf and read that one section and put it back.

Although you feel your child is different and special, and every child is, statistically, your child will be much more successful if you don't monetarily help them when they are struggling.

It was by far the most eye-opening part of the book for me.

Nine years late on this reply, but I went back and re-read the last few chapters of the book after going through the replies to this thread.

I got a very different impression when reading it. While giving money seemed to have mostly bad consequences, giving education did not appear to have the same negative results. The studies suggested that it was a good thing.

Has your mindset in this area changed over the last nine years? You're one of the few early commenters who are still around.

arebelspy

  • Administrator
  • Senior Mustachian
  • *****
  • Posts: 28496
  • Age: -999
  • Location: Seattle, WA
Re: Kids and College-Will you pay?
« Reply #144 on: June 07, 2021, 08:34:12 AM »
That's fair. I can see that interpretation.

All of my experiences were the kids who had a stake in their education via paying themselves took it much more seriously than those going on mommy and daddy's money.

My goal (now with three kids as I type this) is to have them self sufficient and successful enough by 18 that they qualify for scholarships and grants and are capable enough to find and apply for them (with me helping where necessary). Loans should be minimized if done right, IMO.

Additionally, my kids (ages 5, 3, 1) are so far off from college that who knows what will happen to college prices in the next 15 years. I'd rather save money in a flexible way than a college fund, certainly, even if something changes about me needing to pay some part.

I don't think my kids will not be able to attend college due to finances, even if I'm not paying, nor do I think they'll be overburdened with loans.

And that was the MND tie in--I think even if they had loans, they'd be as or more successful than if I just paid them off asap, based on my reading of the study (though you're right that most MND's did fund education, iirc the success of that wasn't tested, just the success of giving money to pay off loans made to start a business, and the kids that had the loans were more successful than the ones starting the business free and clear, unintuitively enough).

In short, I still think the same as before. I'll be glad to help the kids get any sort of funding they can, but I think there are much more deserving kids (dying without medicine in foreign countries, for example) that that money could go to than having my kids just not want to bother applying for grants.
I am a former teacher who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and am now settled with three kids.
If you want to know more about me, this Business Insider profile tells the story pretty well.
I (rarely) blog at AdventuringAlong.com. Check out the Now page to see what I'm up to currently.

MaybeBabyMustache

  • Magnum Stache
  • ******
  • Posts: 3757
    • My Wild Ride to FI
Re: Kids and College-Will you pay?
« Reply #145 on: June 07, 2021, 08:43:17 AM »
@arebelspy - this is interesting to think about. We're confident that we will have too many assets in retirement for our kids to qualify for any help with a financial tie (grants, for example), and we have one kid with a learning disorder who will be very unlikely to qualify for merit based support. Would that change your mind at all?

We are planning to help out a lot (due to the above factors, & also because we can), but also require our kids to work, save for college, etc. We will want them to have "skin in the game".

This topic is near & dear to my heart at the moment, as we suddenly have a 9th & 10th grader this fall.

arebelspy

  • Administrator
  • Senior Mustachian
  • *****
  • Posts: 28496
  • Age: -999
  • Location: Seattle, WA
Re: Kids and College-Will you pay?
« Reply #146 on: June 07, 2021, 08:49:49 AM »
A learning disorder could change the equation, though I'd want to make sure college is the right path for them, not one of frustration and further failure and unhappiness.

Also, I just googled college scholarship learning disabilities and got tons of hits/options. Have you explored that path?

There's so many more grants/scholarships/free money out there than people think. By the time my kids are 16ish, I want them to treat finding and applying for them like a part time job--it'll certainly pay like one, or better. Teach them responsibility, work ethic, give them skin in the game, etc.

My goal as a parent is that by the time they leave the house at 18, they are functional adults--can pay bills, do laundry, cook meals, etc. Applying for these things is good training in dealing with bureaucracy. And, crucially, they should know how to find and learn that which they don't know (watch YouTube video to change oil, or whatever).

Easier said than done, I'm sure, but there you go.
I am a former teacher who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and am now settled with three kids.
If you want to know more about me, this Business Insider profile tells the story pretty well.
I (rarely) blog at AdventuringAlong.com. Check out the Now page to see what I'm up to currently.

DadJokes

  • Handlebar Stache
  • *****
  • Posts: 2086
Re: Kids and College-Will you pay?
« Reply #147 on: June 07, 2021, 09:03:16 AM »
Thanks for the quick reply. I'm in a similar boat as you (both in mindset and the fact that it'll be a long time from now).

If anything, re-reading that part of the book did make me reconsider my previous plan, but I do still agree that he'll need to have skin in the game. I guess we have ~16 years to determine how much skin.

MaybeBabyMustache

  • Magnum Stache
  • ******
  • Posts: 3757
    • My Wild Ride to FI
Re: Kids and College-Will you pay?
« Reply #148 on: June 07, 2021, 03:25:11 PM »
A learning disorder could change the equation, though I'd want to make sure college is the right path for them, not one of frustration and further failure and unhappiness.

Also, I just googled college scholarship learning disabilities and got tons of hits/options. Have you explored that path?

There's so many more grants/scholarships/free money out there than people think. By the time my kids are 16ish, I want them to treat finding and applying for them like a part time job--it'll certainly pay like one, or better. Teach them responsibility, work ethic, give them skin in the game, etc.

My goal as a parent is that by the time they leave the house at 18, they are functional adults--can pay bills, do laundry, cook meals, etc. Applying for these things is good training in dealing with bureaucracy. And, crucially, they should know how to find and learn that which they don't know (watch YouTube video to change oil, or whatever).

Easier said than done, I'm sure, but there you go.

Thanks for the reply. It's interesting to think about. I had a similar approach to my own college life (lots of planning to get scholarships & grants), but my parents made very little, I had great grades & extra curriculars, etc. So, I was a really good candidate for many options. I also worked all through high school.

I certainly want my kids to be functional adults by the time they leave the house, and I definitely want them to have real life job experience (my 15 year old applied for a job with his school). We're not sold on a four year college right away for our kid with a learning disability. I think gap year, starting at a community college, etc may all be more realistic options. If he found a trade that he was really passionate about, I'd be fine with that as well. He's got a lot of life navigation ahead, so we'll be there in background to help him explore, fail, learn, try again, etc.

In our particular case, the learning disorder is combined with a lot of executive functioning challenges. Grades are going to be a real struggle, and most scholarships that I've found require pretty high grades. Anyway, we'll go the "must have a job" route, vs "must explore scholarships & grants". I have one child who has the potential for an athletic scholarship, but doesn't want to play sports in college. We are very supportive of this choice, as it means a lot of limits on where you go, how you handle the balance of athletics vs academics, etc. We'd prefer he play sports for enjoyment & then have a part time job to supplement his income.

CrustyBadger

  • Pencil Stache
  • ****
  • Posts: 963
Re: Kids and College-Will you pay?
« Reply #149 on: June 07, 2021, 03:56:15 PM »
I just watched my son go through the college application process last year, and saw what was required in hunting down and applying for scholarships.  It requires intense organizational skills and good writing ability, as well as a good dose of self esteem.  Kids who do not have string writing skills can get overwhelmed with the amount of essays required in applying for colleges plus the extra scholarship applications, especially if they are applying to multiple colleges because they are chasing merit aid.   

The Common Application many colleges use now only asks for one essay, but most colleges also ask for a few supplementary essays, and if you are applying for a particular university's honors program or presidents'/dean's scholarship, there are usually another couple of essays.  As you submit the common application for each school, there can be some last minute "quick" supplemental questions asking for just 100 word responses .. but there are 5 of them.

If you have a kid who loves to write, this is hard but not awful.  If you have a kid who hates to write.... applying for extra scholarships on top of just applying to college will be very very hard.