My College Fund is Gone (Parents invested everything in the stock market)

Paying for College
1

<p>My mom just called me yesterday and informed me that my college fund had basically disappeared. The whole think had been invested in the stock market and now it's basically down to nothing. I don't even have enough to go to community college for more than 2 semesters. At my current school (flagship in-state public) my first semester is already paid for but the second one is not. After finals my parents will be driving up to pack up my stuff so I can leave. </p>

<p>I'm so lost, I don't know what to do. I feel betrayed by them almost, but I know I should have been more on top of them, knowing exactly where my money went to. I just don't know what to do. It doesn't seem real.</p>

2

<p>Go and talk to the financial aid department at your school. I'm sure that you are not the only one in this situation. They will ask for verification of your parent's income (your college fund isn't the only thing the schools look at when they are evaluating your need for financial aid). But do go and talk to them. I have heard that some schools are figuring out emergency loan situations for some students.</p>

3

<p>Thumper is absolutely right. Also, look for a job. You may have to go part time. You can still do it. Find a cheap room, a job, maybe two and cut down on the student loans.</p>

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<p>I meant student load. Not loans.</p>

5

<p>thumper1 has good advice. Talk to your school first. This same thing has happened to my neighbor and she's at a very expensive LAC. Worst-case scenario is you move back home, get a job, and I'm sure you'll make enough money to take some classes at your local cc.</p>

6

<p>You know...there are tons of students...probably the majority...who have NO college "funds" set up, and somehow they are able to go to college. Agreed with above poster who says...perhaps enroll part time somewhere...live at home to save money...get a part time job...or get a full time job and go to school part time.</p>

<p>Also, are your parents saying they cannot help you at all with college costs? Perhaps they just can't contribute the amount they were previously contributing. These are unsettling economic times, but if your parents are working, are they able to take out a small loan for you? </p>

<p>I don't think your only option is to just come home. Ask your parents what they want you to do when you come home? Do they want you to leave school and work full time (they should also check about things like health insurance costs, car insurance, etc if you are not a student and factor in those costs as well)? </p>

<p>But first...talk to financial aid at your school. I hope you have a FAFSA on file. If not, it's time to complete that as well.</p>

7

<p>Wow, that is an upsetting situation to be in, but like the previous posters said, you are not the only one. I agree also to go and talk to finaid at your college. We have some friends in this situation. Their son attends BU . When dad lost his job at the end od the second semester, they arranged a meeting right away with finaid. I haven't heard lately how stings stand, but he is still there.
Sadly, I think that his topic will become more and more present here.
I am worried too, how we will be able to continue to pay for two in college.
I hope everything works out for you.</p>

8

<p>You will not have to give up your college dreams, but you will have to be --as has always been the case for many students-- proactive about your own education, and that means that you'll have to make personal sacrifices in support of your own education.</p>

<p>This means that you'll have to take out loans and also will have to work. Now is the time to get a parttime job. When I taught at a public institutions, I had students who were working up to 30 hours a week to help pay for their education. One such student also was doing major campus ECs related to her major, journalism. Her ECs -- copy editing and writing for the campus newspaper -- were essential because she wanted to have a career as a copy editor, and to get a job or internship in journalism, one has to have a lot of student media experience. She also was volunteering teaching English to migrant workers (Why? She felt she should give back because she, daughter of immigrants, felt honored to be in a country where she could obtain a college education). She graduated magna cum laude and had nine fabulous job offers upon graduation. She also had about $30,000 in loans despite having started her college career at a community college in order to save money.</p>

<p>She carried a far heavier load than you may have to. Most students who work, work only up to 10 hours a week during the school year and work fulltime during the summer. Incidentally, that's how I went to college, and that's how my S is going to college. Plus both of us took out loans.</p>

<p>As a freshman, you can qualify for $2,500 in Stafford student loans this year from the government. Once you are a soph, you can qualify for $6,000 in loans. Your college financial aid office can tell you about this. There also may be college-sponsored loans you can qualify for. It may be hard for you to get need-based financial aid --now or later -- from a public institution because the majority don't have the funds to be generous in that way. </p>

<p>Your parents also probably can take out loans to help you. If they are hesitant about taking out loans, you could promise to pay them back. That they were paying for your college education via a college savings fund puts them and you ahead of most American families. It's typical for parents to take out some loans to help pay for their kids' education. In addition, the average American student graduates from college with a total of $17 k in loans that they are responsible for.</p>

<p>Most parents of college students also are having to cut back financially in order to use some of their current wages to help pay for their kids' education.</p>

<p>Other options for you are taking time off and working for a semester or year to help save money for college. If you live at home and serve a year as an Americorps Volunteer, you'd get a stipend to live on, and at the end of your service, you'd get $4,700 to use for college. Google to find out more. </p>

<p>My younger S did that and he got excellent work experience that included developing marketable skills in things like grant writing. He also made a difference in our community.</p>

<p>This concerns me about your post: " feel betrayed by them almost, but I know I should have been more on top of them, knowing exactly where my money went to."</p>

<p>Your parents went far out of their way to try to help you, and you feel "betrayed"? Meanwhile more than likely they -- as well as many millions of others -- have probably lost much of their retirement funds. It is far more difficult to recoup retirement funds than it is to get the money to continue in a public university. </p>

<p>I understand that you're shocked and disappointed, but it would be best to turn your energy to doing what you can to continue your education, something that definitely is possible if you're willing to be proactive about making your dreams come true.</p>

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<p>OP >>>>My College Fund is Gone (Parents invested everything in the stock market) </p>

<p>My mom just called me yesterday and informed me that my college fund had basically disappeared. The whole think had been invested in the stock market and now it's basically down to nothing. I don't even have enough to go to community college for more than 2 semesters. At my current school (flagship in-state public) my first semester is already paid for but the second one is not. After finals my parents will be driving up to pack up my stuff so I can leave. </p>

<h2>I'm so lost, I don't know what to do. I feel betrayed by them almost, but I know I should have been more on top of them, knowing exactly where my money went to. I just don't know what to do. It doesn't seem real. <<<<</h2>

<p>First of all, I've got to "straighten you out a bit" (do the "mom thing"). Feeling "betrayed" is not fair to your parents. They did their best to provide for you. If they had just put your college fund in a savings account or CD, it wouldn't have made much money at all - and you'd still be in the same boat. Many people used the stock market to increase their yearly contributions into a bigger yield because their contributions alone would not have yielded the $100K+ that is needed these days for college.</p>

<p>Also, your statement that you should have stayed "on top of" your parents in regards to how they were investing your college funds is a bit arrogant. You would not have been able to foresee any of this. In reality, if you had looked at your stock portfolio a few weeks/months ago, you would have been applauding them for having done such a good job. So, don't even think about saying anything of the sort to your parents.</p>

<p>Ok...now that I'm done berating you ;), here's some advice.....</p>

<ol>
<li><p>An above poster is right, many parents haven't saved one dime for their kids' college, yet those kids manage to still go to college. You need to think "outside of the box" a bit. </p></li>
<li><p>What year are you? If you do go to a community college for a semester, will you then be a junior? If so, then you might be able to transfer to a school that gives merit money for transferring juniors. If you are a freshman, then you might have to go to a community college for 3 semesters, and then transfer to a school that gives merit money to transfers.</p></li>
<li><p>What state do you live in? Many of us can make better recommendations if we know the general area of where you live and are likely to go to school.</p></li>
<li><p>Get a part-time job. My son works for his university as a paid tutor (the school provides free tutoring for students). He doesn't make much (about $80 a week), but it at least give him pocket money for gas, incidentals, etc. He might make more money privately tutoring, but this method works for him. </p></li>
<li><p>Plan on working full time in the summer.</p></li>
<li><p>Thank your parents for what they tried to do. They are feeling very badly right now, and you can be the "hero" by being an adult about this and coming up with some workable solutions. When they come to move out your stuff, don't act like your life is over. This is one of the many bumps in the road of life. </p></li>
<li><p>As mentioned above, go to the financial aid center at your school. The school may have already anticipated this problem and may have already put into place some solutions.</p></li>
<li><p>OK, your college funds are almost gone, what money, if any, do your parents think that they might be able to scrape together within a year, if you go to a community college for a semester? Could one of them take on a part-time job (Obviously not a possibility if both are employed in careers that already demand more than 40 hours per week.)</p></li>
<li><p>Keep your grades HIGH. Don't let this situation affect your performance. And, if you have not been such a strong student in the past, this is the time to "step that up." You are far more likely to win some scholarships with exception grades than just A/B grades.</p></li>
</ol>

<p>I'll try to think of some other solutions and post them later.</p>

<p>Also, tell us a little more about yourself.... your academic stats, your major, your interests, etc. This info can also help us come up with some solutions to your situation.</p>

<p>Sorry for the little slap on the hiney at the beginning, but I think you needed it a bit :)</p>

<p>.</p>

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<p>Unless your parents have sold your shares to recoup what they could, your funds are likely to return at some point. Over any 20-year period in American history - including the Great Depression - the long-term outcome has always been better in the stock market than anywhere else. This may not return in time to provide you funds for tuition, but it may assist your long-term ability to repay loans.</p>

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<p>"Thank your parents for what they tried to do. They are feeling very badly right now, and you can be the "hero" by being an adult about this and coming up with some workable solutions. When they come to move out your stuff, don't act like your life is over. This is one of the many bumps in the road of life. "</p>

<p>I agree with this. Your parents sacrificed a great deal to try to help you. That things didn't work out isn't a reflection of their being uncaring or stupid. I'm sure that they are devastated and are feeling guilty about something they had no real control of.</p>

<p>Be the bigger person, and tell them that you love them, appreciate them, and gladly will be doing what you can to make your college dreams come true.</p>

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<p>He isn't going to be able to wait 20 years for the stocks to rebound. The money is, apparently, gone now.</p>

<p>The parents should have taken the money out of the market (at the latest) when he went off to college.</p>

<p>I agree with those who say to fight to stay there: call fin aid, work a job, leave campus housing and move off campus in a cheap room. Or (egads) go to CC for a semester or a year.</p>

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<p>hang in there, myformerlife. Don't panic. A good friend so advised me and recalled this metaphor when I learned I had cancer: when divers in the deep sea have to come up to the surface, they go up gradually, lest they suffer a malady called the bands.</p>

<p>Re-evaluate, and re-calibrate, and then go after it again. Talk to the FA folks and fill out the special circumstance forms, room with someone off campus, pt job. You might even even do the college thing with more gusto and engagement than when you had the money. Remember the Oxford Cleric from the Canterbury Tales where he spent everything he had on books.</p>

<p>others on cc: I happened to see this today and wanted to share it somewhere in this forum.</p>

<p>Undergrads</a> on the Bread Line - Yahoo! News</p>

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<p>OP, you've gotten some excellent advice here. My thoughts are, first, don't panic and tell your parents not to panic. Run, don't walk, to your school's finaid office. See if there is something they can help you put together so you don't have to leave your current school in the middle of the year. That's going to be emotionally wrenching, even if you keep a stiff upper lip if it happens. Assuming your parents haven't yet sold the stocks in the college fund in a panic, they are going to come back in value over time, and it won't take 20 years like MSUDad says (sorry I disagree with that estimate). My H and I lost a bunch in the October 87 crash and it took 3 years for it to come back to the value it had right before the crash. Admittedly, even 3 years is too late for you right now to actually pay the bursars bill, but it's not too late to repay loans that could get you through the immediate crisis. And it's not too late for your parents to pay off PLUS loans to help you out. If you can stop gap next semester for everyone including the markets to calm down, you and your parents and some counseling at your school can work out a plan for your college future. It won't be the plan you had in August, but it will be a plan.</p>

<p>fwiw, I attended several meetings last week with people in the local financial industry and they seemed to think the market is at or near bottom and will return to value in about 5 years, 10 max. Of course, this just goes to show that you need to get out of stocks in advance as you near the event you invested for, whether that's tuition or retirement, but as it's too late for that for the OP's parents don't dump on them. They tried to do their best, and they need to calmly assess things with a little help from the finaid experts at the school.</p>

<p>Actually, the financial guys here think 3 to 5 years is the most accurate estimate on market return. They think 5 years from now people will be kicking themselves for not buying stock at "Oct 08 prices".</p>

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<p>I've got little to add to the financial advice other than the good advice you've been given. Between loans and a job, there is hope.</p>

<p>My heart goes out to you in this bad time.</p>

<p>I ask you to have some sympathy for your parents. Take it from a parent who has made his own mistake and had to explain it to his kids: your parents are probably sick to their stomachs over having to tell you this.</p>

16

<p>There's a lot of good advice here. I'm sorry this is happening to you. Don't take any lecturing from posters to heart, you're in shock and it's understandable to express your feelings about you're parents or anything else related to this, especially in a forum like this one. It's not your responsibility to stay on top of your parents investment decisions. And I'm sure they hoped they were doing what was best for you. Maybe they should have pulled the money when you went to college, but hindsight is 2020, and a lot of very experienced people have been hurt in this market. Follow some of the good advice posted here, figure out a way to continue somehow, somewhere, and if it's not too late where you are, register to vote, it can be quite empowering.</p>

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<p>nodwntm: >>> Maybe they should have pulled the money when you went to college, but hindsight is 2020, and a lot of very experienced people have been hurt in this market. <<<<</p>

<p>Many, if not most, parents depended on the continued fund growth that would occur during the 4 years while their child was in college to cover all the costs of the later years in school. Often parents don't have the total amount needed for all 4 years on day 1 freshman year.</p>

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<p>Don't blame your parents...they couldn't have seen this coming. And don't say there's no hope....I had NO college funds but due to scholarships and grants, I've been able to go to school this entire year without any loans. Ofcourse, I took care of all the financial stuff myself and kept my mom out of it, so if anything goes wrong I have nobody to blame but myself.</p>

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<p>Unless your parents have already sold everything at a loss, I'd advise you and them to sit tight. The party isn't over yet: U.S</a>. stocks rally sharply in cheering global rescue plans - MarketWatch</p>

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<p>Don't take this advise if you are not tough, have a sense of duty to country and are not willing to go in harm's way to create or protect freedom for your countrymen and folks around the world.</p>

<p>Consider joining your state's National Guard either army or air force just as thousands before you have done. You'll have a six year commitment to serve and you might be deployed and taken off your school schedule or get killed or receive serious physical and/or psychological wounds in the process--these are the realities on the down side.</p>

<p>The upside is that if you have the right attitude it could all be an extremely gratifying experience. You'll be serving your country as millions of Americans have done throughout our country's history. You'll feel great having money in your pocket while not having to depend on loans or your parents to earn a college degree. You'll get away from home for basic training for about 10 weeks and then you'll have advanced individual training based on what specialty you choose; the length of which differs depending on the field.</p>

<p>As for money for college in many fields you'll earn a $20,000 bonus once you complete training and during training you'll be paid pretty well and not really have many expenses so you can save lots of this active duty pay. Once training is complete, say in time for fall semester of 2009 you'll start to receive education benefits. Most states will cover the full cost of tuition and fees at your flagship state school--so tuition completely covered in exchange for that 6 year commitment. The Reserve GI Bill will pay $327 bucks a month for a max of 36 months that you can use towards non tuition costs of attending. Additionally you'll have to spend one weekend a month at drill that will require this time commitment but you are also paid based on your rank and time in service and so you'll clear $140-$190 of additional money for yourself each month.</p>

<p>Between the bonus, temporary active duty pay during training, GI Bill and monthly drill pay you'll be close to covering your entire costs for books, room and board and spending money. If you earned any scholarships from your school these could still be used for offsetting costs. Some young men and women because of additional scholarships actually end their four years at college having no debt and have money in the bank. You might even like it so much that you want to become an officer and join ROTC and accumulate a different set of benefits. The experience of being self sufficient and having served also pays dividends when job seeking in the private sector.</p>

<p>If this interests you I suggest you seek out and talk to upper classmen on campus now serving in the Guard to get their feelings.</p>