I So Agree With This

[Scanner]

http://finance.yahoo.com/college-education/article/102647/Kids-Should-Help-Foot-the-Bill-for-College

If you read the gurus and the pundits on personal finance and investing for college, there is a "between the lines" message that somehow, you are going to have to invest X to reach Y to pay for $125,000 worth of college expenses by 2018, etc.

I know I paid for my room and board all 4 years, my books, car repairs, and personal expenses with part time work (and a few dollars here and there from "benefactors" ie. grandparents). At the time, this was about $7500/year so I figure I contributed $30,000 over 4 years to my education. And I wasn't really busting my butt either - maybe 50 hours work/week in the summer and 10-15 hours/week during school.

My parents paid tuition and car insurance and I am eternally grateful. They paid about $60,000 over 4 years ($15,000/year in tuition and car insurance)

I wonder why the financial industry sends the message that parents must somehow give their kid(s) an all expense paid trip? I don't get it.

[creditcardfree]

So do I. We expect that our girls will have to help pay for their college even though we are saving for it.

My husband used money from the army, tuition reimbursement and loans to pay for college and mine was paid for by my parents. Although, I appreciate mine, I don't think I appreciate it in the same way that he does his.

My parents may still be paying on mine or my sisters. A year ago or more, they asked me to drop some mail off at the post office and one was for a student loan lender! I graduated 11 years ago from college. Yikes!!

[disneysteve]

Money Mag did a feature a few months ago that had a 2-page fold out with "Rules to get rich by" or something to that effect. One of the many rules was to try and save 1/3 the cost of college for your kids. I think that sounds pretty reasonable. The other 2/3 can come from a combo of financial aid, grants, loans, work-study and student savings.

I graduated undergrad with $14,500 in loans and finished med school with $102,000 in loans. In 12 years, I was debt-free and had bought a house, had a child and was fully funding our retirement plans and other savings.

There is no reason parents need to pick up 100% of the college tab.

Another thing to keep in mind is that not all of the parental contribution needs to come out of advance savings. Some can also come from current income when the child is in school.

[MonkeyMama]

I am with you.

That & why does college have to cost a zillion dollars???

My education cost me about $10k - including books and supplies (& I took 5 years). My dad's cost far less - we both raked in (will rake in) six figures most of our career. Public education is a viable alternative in many careers. The cost has gone up but still doesn't even compare to private school. Plus community college could have cut my costs about in 1/2.

I look at my friends with no assets saving the billion dollars for college and I think they are absolutely crazy. We are building our nest egg. If we so choose to help our kids we will delay retirement - if they must go to Med school or something and we feel they deserve some help.

This is one reason I like Suze ORman. She says take care of yourself first, before you start saving for college. She was the first financial guru I agreed with on this particular issue.

The societal trend around here is to not leave the nest until the late 20s. Most of the people I know got expensive private school degrees and had a big party on mom and dad's dime. Then they went to public school to get a real degree and a real job. I find it super ironic because when I graduated high school my parents refused to foot the bill for private college or room and board far away and so my "friends" laughed at me and teased me. I had gotten into the best schools but went to state instead. Then 10 years later I found out most of them are going to my alma mater for a second degree and still living at home. IT was a lesson my parents learned, taught me, I will pass to my children. Oh so so ironic I was the one so bad off stuck at state whereas 10 years later I Was 5 years into a solid career and owned a home. Their education cost 10 times as much and got them squat. This is just the norm for my area and the peers I hung around with - the nerd crowd. A few have gotten their PHDs and are doing quite well, didn't squander their college years. But too many of them lament they have useless, over-priced degrees while they work in retial and figure out what they really want to do with their life. Their parents put so much emphasis on education but little else, no real long-term plan, little regard for what their kids wanted to study either. It is strange, a little unique to the area, very high immigrant population. But this is what an over-emphasis on college, at any cost, seems to bring.

We ourselves will have enough saved to help our kids if need be, if we so choose, reasonably at least. But we will not earmark anything specifically for college. Frankly the grandparents have 529 accounts and I am worried they are saving too much. WAY too much if our kids just go to state... All the more reason we aren't worrying about it while they are babies.

[Joan.of.the.Arch]

Families have reasons for making their choices about financially supporting their "grown kids" in college or elsewhere. There are many factors to weigh, factors which vary from family to family and even through time and place. They can vary from child to child within the family, too. It is good to have advice as to how to best save for college in case a parent wants to pay or help pay for it.

I do not think that most young adults who go to college have a free ride on their parents. I would be interested in seeing research on how it actually breaks down. I'm guessing that most college adults (I don't think I will say "kids") do work to help support themselves and pay at least in part for their educations, their room and board, their transportation, their recreation, etc. The way you and your parents handled it, Scanner, is very common, I'm sure.

My husband teaches in a college and I get the impression that he has very few students who are all paid for by their parents. His students work. They hustle. Many of them are not fresh out of high school either. The average age at colleges now is probably a lot higher than you would guess.

But are you suggesting that professional financial advisors may have ulterior motive to suggest we pay them in one way or another to help us handle our money? Well, of course. Many professions recommend we make use of them more often than is probably really necessary.

[jIM_Ohio]

I am always amazed when I hear of the college payment stories... Here's my take.

My kids (which don't exist yet) can go to three schools and have it paid for by me/ my wife (she's also agreed to this):

GMI/ Kettering (my alma matter)
UC (wife's alma matter)
Notre Dame (sentimental choice of my wife and I)

Anything else they are on there own. I think I learned more in the 7 years I was "on my own" in college than I did in the 18 I lived at home, or the 10+ years since.

In my wife's case, she is the first person in her family with a 4 year degree. Her mother worked hard to fund the education, and we are also paying some of those loans to this day.

In my case, I earned enough co-oping to cover tuition (if I was smarter), so the loans I had were a combo of me being stupid and the fact I was co-oping in some cases 400 miles from "home".

Community colleges are just fine. Many schools have 2+2 programs set up, so the first 2 years are at a community college and last 2 at a traditional 4 year university. This is method I'd suggest to anyone which "hesitates" about whether they know for sure what to do. If I knew then what I know now, I would have majored in something more math intensive (like computer science) as opposed to Mechanical Engineering. Some 4 year schools require a decision be made real early with regards to majors or specialties, and from that standpoint, I thinka 2+2 program, combined with working in a field prior to getting a degree in it is quite important.

The school of an undergrad degree usually makes "little" difference in what job is landed. In my case, I chose based on knowing 99% of GMI grads have jobs prior to graduation... but my wife interviews for a living and she barely glances at what school a person went to. She doesn't care if a person went to UC, Harvard, Stanford or wherever... she looks at their experience.

I have a brother which went to school for Marine Biology and decided he wants to watch birds for a living (that's not exactly something which needs a degree or pays for the bills). So he's in debt, follows his passion and IMO he wasted his (and my parents) time and money.

[disneysteve]

Many of them are not fresh out of high school either. The average age at colleges now is probably a lot higher than you would guess.

This is true in grad school too. When I entered med school in 1986, I was the 2nd youngest in my class. The average age was over 27 (I had just turned 22) and the oldest student was 44.

[pearlieq]

My kids (which don't exist yet) can go to three schools and have it paid for by me/ my wife (she's also agreed to this):

GMI/ Kettering (my alma matter)
UC (wife's alma matter)
Notre Dame (sentimental choice of my wife and I)

Anything else they are on there own.

Is there a financial reason for this?

[fairy74]

I worked my way through community college, undergrad and grad school. It was the best education I got by far. It was amazing how much more focused I was by working and going to school. I think a lot of parents have this idea that their kids will study harder if they pay for everything and school is the only thing they have to do. In my experience, it didn't work out that way at all. DH and I agree we will pay for two years of community college (tuition and books only), if they want more than that, they'll need to work full-time, take classes part-time or take out loans. I agree with what some others have said as well, I graduated with my undergrad degree at 26 and my JD at 30.

[jIM_Ohio]

Is there a financial reason for this?

Somewhat... I don't believe in fully funding education for kids. I believe I learned quite a bit from repaying my student loan debt and having to go it on my own, and paying for kids education would dilute this experience, IMO. I think taking out loans puts liability on child to perform, which reduces my financial risk while increasing childs overall "learning" (about life and academics).

If "early retirement" is the tradeoff, I think I need to think about me before child's education- I take on risk if I commit to funding a child's education.

If I can find a way to afford payments for child's education and early retirement, the child will get the money when they finish (they still need to accept the risk of taking the loans).

[jodi]

I too paid for a large chunk of my education, both through working and student loans. As DH and I will never be big earners in our fields (social work and education), I think our kids should be eligible for a decent amount of financial aid. We are not planning to save much for their college. We both went to a private school on a combination of scholarships, aid, and loans - but both worked all four years and summers as well. Our kids can do the same.
However, we have hit upon the idea of paying off some of our kids loans for them after they graduate as an incentive to do well. I know I would have LOVED for someone to pay down some of mine!

[pearlieq]

Somewhat... I don't believe in fully funding education for kids.

I understand that and agree heartily!

But why only the 3 schools?

[Magicman]

What is a reasonable amount of money for the parents to pay?

I think that it is a judgement call... how about tuition and books? Let the student pay for real life expenses, like housing, food, etc. At any rate it takes a special kid to finish college. Go Cougars!

[LivingAlmostLarge]

I want to pay for my kids. I also don't want them to flunk out so I'll probably make it grade based. That if they pass it's paid for. If not they can handle the school loans they used to party with instead.

[Lori63]

.

My kids (which don't exist yet) can go to three schools and have it paid for by me/ my wife (she's also agreed to this):

GMI/ Kettering (my alma matter)
UC (wife's alma matter)
Notre Dame (sentimental choice of my wife and I)






.

I imagine this may change once the nonesistent children are 18 and perhaps another school may be their first choice and a better fit for the child.

My son is almost done with his freshman year at a private college. He got tons of money from grants/scholarships and a small loan. We contribute what we can but are not going to go broke over this. We also have two other sons.
When I was at WVU, I was left with no money (long story) and worked two jobs and did just fine.