<p>I know situations are different (& we've talked to financial planner, etc.) but wondered what other people have compiled, if you wouldn't mind sharing? </p>
<p>Son is entering high school--we've saved some (approx $25k) but I'm anxiously thinking maybe I should go back to work (full-time?). I have a 3 year old too, so didn't want to jump back into the work force full-time.</p>
<p>But, am thinking maybe we're so off the mark that drastic measures are necessary...???</p>
<p>I could also work pt time & get our college contributions up to $300 a month. </p>
<p>Jolynne ~ It depends a bit on the total package...family income, assets, and where do you think your hs S wants to go to college? The best thing might be to discuss this with the planner you mentioned, and to consult one of theExpected Family Contribution (EFC) calculators to see what your family might be expected to pay for child #1 at different schools.</p>
<p>All good advice, above. I think the answer to the OP's question depends in part also on your tolerance for debt and your confidence in being able to pay it off. If you have the will and the ability to avoid debt in the first place, you should save more. We were fortunate to be able to save enough to avoid accumulating debt (in our or our kids' names) through college. With our family income, we'd have received no need based aid. The kids got out of college with no debt at all. So while this all cost a lot of cash, after graduation everyone is home free, so to speak.</p>
<p>When my son was about 2 there was an article in the New York Times with a timetable.....our goal is 225K for the 12 year old and 250K for the 8 yr. old.....that's what the article said private U. or college would cost....whether we'll make it or not? Well, let's just say retirement isn't an option right now!</p>
<p>Also, consider whether S has any prospects for merit aid. Of course, there are no guarantees. But if you read the Schools Known for Good merit aid thread, and you think he fits near the top of applicant pool for any of these schools which might interest him.... then that would help.</p>
<p>Many merit aid awards seem to go to the "early bird", those who apply early in a rolling admission school, those who apply early action (non-binding, so you can evaluate all aid pacakges). We knew S' merit award from Tulane before even the RD deadline for other schools, so you could re-jigger your application strategy in late December depending.</p>
<p>Another possibility is to see if your state has a prepaid tuition plan...I have one for my S (in VA, where U VA is a terrific option)...it's not the best way to save if S doesn't go to U VA, but it's a guarantee if savings don't pan out or FA doesn't come thru in adequate amounts...of course, whether it is a good idea depends on your state's schools, and on their savings plans (529 plans if you want to ask your financial advisors about it)...</p>
<p>But benchmarks are as follows: I just looked up Cornell's 2005-2006 "COA" (cost of attending--it includes room, dining, tuition, books, personal and some travel) is $43,500...that's about the same as for all the other private, selective schools we investigateed...the $43,500 is a about $2000 higher than the 2004-2005 COA estimates listed on Cornell's website...so I think most of us are figuring about $200,000 to $225,000 for four years, if our kids are starting "now"...of course, that's w/out FA and it's the "high-end" option...</p>
<p>Well, I have to say that we did not save at all. Not a penny. We were both in grad school, then worked low-paying jobs, then decided to build our own home - and, oops, the oldest was ready for college. What we DID do was NOT have any debt - apart from a mortgage. We've just completed year one of first child's college and we are still solvent. (I did pull $2000. out of our very small ROTH IRA, but I hope not to have to do that again.) We have some financial need, and DD is attending a school that meets 100% of Financial need - so we are living our frugal lifestyle and paying our EFC out-of-pocket. Not having any debt (car, credit card) etc. make a big difference. Also we don't have cable TV, neither of my kids drive (I'm too cheap to pay $2000. a year for student car insurance.) We always figured that our kids are smart and would get scholarships, or go to public colleges and help pay their own way through school. It hurt a little (ouch) for DD to turn down a free-ride at a OOS public school, but it has been doable at the terrific private university she attends.<br>
Another note: some of the expenses of college are things that you ALREADY pay for - food, travel, clothes, personal expenses etc. When your kid goes off to college, you are just paying that in another location. (That's about $3000. a year right there) Then there is the tax break (say $1500. saved) And your kid can earn money during the school year and over the summer, and become an RA or live cheaper off-campus...</p>
<p>Thanks for ALL that great input (making up a file of suggestions, now!!).</p>
<p>I read those figures before ($200k etc.) and just <em>couldn't</em> believe they were true. Thinking--that must not be factoring in aid/loans. Scary!!</p>
<p>Trying (attempting vainly, perhaps) to live the frugal lifestyle as well, anxiousmom! (But still have [big]mortgage/car debt!). Like the tip about no car insurance! That would address two concerns--1. saving money 2. fear of son getting behind wheel of car & getting hurt! lol.</p>
<p>Anxiousmom--I can relate to what you say. Our boys each had about $6000 in savings when college rolled around. That was simply the best we could do at our income level. Part of that went to buy a laptop computer, part for all those necessities like sheets, towels, new clothes. So not much was actually left for college expenses. However we received excellent need-based aid for the first son, and he took out some loans and worked summers. There were times we had to dip into our small pile of retirement savings bonds. Once we took $1000 out of life insurance. But so far it has all worked out.</p>
<p>With son #2 we will be expected to pay more, since I am now working part-time and all those overtime hours dh worked are added into EFC calculations. However, I will have more time to work when he is gone, and our food bill should drop quite a bit! :-)</p>
<p>If you are able to save for their college, that is wonderful. If you can't, there are still ways to work things out.</p>
<p>Jolyne, I think something that hasn't been mentioned yet is important. While there are sometimes "ways to work things out" as Susan suggested, that is not always the case. Smart and caring parents prepare their kids BEFORE they start looking at colleges for this possibility by giving them realistic expectations about the family's ability to afford certain colleges. </p>
<p>When your son gets to junior year and starts looking at colleges be very honest with him about the financial situation. Let him know exactly how much money is available, how much you are willing/able to borrow, etc. Use some of the online sites to do an estimate of the type of financial aid you might expect. Then lay the cards on the table: tell him that if he wants to go to a private school costing $40,000-plus a year but your calculations show that you will only be eligible for $10,000 in financial aid and have saved up enough to contribute another $20,000 a year out of pocket, that he will either (1) have to find another college (2) work and borrow to make up the difference or (3) find a school where his grades and test scores will give him a solid change of getting a merit scholarship to make up the difference.I would also, if this is the type of scenario that plays out, encourage him to make sure he has financial safties, such as your state public system, on his list of schools to apply to because merit money is NEVER guaranteed.</p>
<p>By laying all of this out at the beginning, not the end, of his college search, you will avoid the heart-breaking disappointment we see time and time again here on CC: Parents that let their kids apply to schools that they KNEW they couldn't afford, that they weren't going to get financial aid at, and that didn't offer the expected merit money. Don't fall victim to this! </p>
<p>In fact, it may be wise to start these discussions with your son while he is in his freshman and sophomore years of high school - i.e., you need to keep your grades up so you can qualify for merit scholarships, you should get a summer job so you can contribute something, etc.</p>
<p>ahhh, a good responsible parent question and problem. Possible solutions for you is going to be real tough because you are middle class, X generation, saved money and backbone of America's financial system undergoing a financial and political change. </p>
<p>IMHO: Solutions would be much easier if your child will enter college next year or for your 3 year old. But you have a split pin problem that may defy good answers.</p>
<p>How about sending oldest to a program with great life experiences during the next few summers instead of trying to save for college?</p>
<p>If you went back into the work force and saved for next 4 years, maybe you would have another $16K to what you already have with additional gains on the $25K; At most $45K. This is enough for a public school but way short of a private school. </p>
<p>Keep all options open. Investigate all possibilities. Never close the door. Understand the process. </p>
<p>not to disparage YOUR planner, but most haven't the foggiest notion of efc calculators, and other key FinAid issues. Yes, they know that college costs a lot, and can present value that amount into an investment package for you to purchase, but they don't know ___ about what happens in the FinAid offices. CPA's don't either, for that matter, so interview planners wisely. They can and do recommend some poor strategies.</p>
<p>jolyne,
I did save enough 5 years ago that I could pay 4-year tuition at Ivy for one kid, but I read that colleges don't count home equity and decided to put all that money into my house. The bad part is we no longer live in that house, so I guess the rent from that house will be used to cover the tuition.
I still have some money in a gift trust that I'm debating to take out because the trust won't mature until d is 25 year old, I was worried that 18 is not quite a mature age, I wonder how does college/FAFSA treat this? Technically it's in my name as a trustee for d, do they count this as my money or her money? Does any one know?</p>
<p>Susie, We also have a gift trust for our children. We are the trustees but the trust is in their names. It is my understanding (and I could be wrong) that if the trust is earmarked for the child (i.e., set up in his/her name), then colleges will look at that money at a higher rate of expected contribution to costs then if it were solely in the parents name. The fact that you are trustee will not mean schools will consider it "your" money - they will see it as your child's money. This is probably something you should discuss with your tax person before you do anything as some trusts are irrevokable.</p>
<p>carolyn, do they care whether the trust cannot be accessed until after college, I did not set this up as a college fund but realize much later that colleges will treat it as such, so now I'm thinking of breaking it. Oh well, If my husband and I stay working till D goes to college then it won't matter, base on our income and assets they will expect us to pay 100% that is why UC's looking very good.</p>
<p>I work in the Financial Planning industry (not on commission) and I have a warning for you. My guess is that your planner works on commission and if so, he may have recommended a 529 plan from a state other than your own. A 529 plan may be the best way for you to save for college - especially for your younger child - and you must realize that the plans for some states do not pay commissions. Planners (brokers) in those states will often recommend other plans that do pay them. By getting another state's plan, you may be giving up significant state tax benefits and/or paying an extra sales charge that you might not have to pay with a direct sold plan in your own state. Make sure that there is a really good reason if you are presented with a plan that is not from your state. </p>
<p>The most comprehensive resource that I am familiar with is at the following web site:</p>