<p>I remember when friends of ours who had kids a few years before we did said they’d heard that it was necessary to save “$500 per child per month from birth” to fund the college accounts. This was a shocking number to us.</p>
<p>Of course, it turns out that saving that “shocking” amount would only generate half of what is now needed for private college. Possibly not even enough for public university tuition.</p>
<p>We live in the NYC suburbs and, yes, are taking that COL hit. If we could have stayed in the midwest in our old house and my DH could have earned what he does here, we’d be in the gravy, abolutely. But it was not possible. That we moved here, gave him the flexibility to choose among a number of jobs in his field and move around when things started not going his way at work Those options simply would not have been there where we used to live. So, that is one of the things that went into the tradeoffs.</p>
<p>Frankly, I wish we had not made the move, but we’ve been here for some years now, and it is our lot.<br>
Because we chose to buy and expensive home, in a nice, convenient area, that did not need much work and with a lot of space, we do pay alot for that luxury. Which leaves less for other things like college payments for our kids. Other choices, like private K-12 factor heavily too. But again, all are our choice.</p>
<p>We could have borrowed large amounts, and borrow we did somewhat, to give our kids the choice of any school. But when we went through the numbers, it just wasn’t a good idea for our future. We would be paying a lot of loan money for a long time and if anything went wrong with our income, as we have seen this happen with so many we know, it would be financial crisis.</p>
<p>So our kids are given what we feel we can afford and still stay reasonably safe, and still enjoy our standard of living in our home. We make our cuts in areas that are least important to us and we are very priviletged that they are not essentials. But yes, we drive an old beater car, we have junky furniture and I don’t shop much. Vacations went on the chopping block too. I am careful with the food bill and we don’t go out much. </p>
<p>We saved, but not enough to pay for it all. But my kids had their choices and were happy with the spread. They’ve not felt deprived. We did keep them loan free unless they chose to use the loans to “buy up” and they did not. </p>
<p>My college son feels he could have done well and been happy commuting to a local school that offered a full tuition award that he turned down. A number of his friends, from well heeled families, who got the same offer took it, and are doing just fine and enjoying life. So it’s not such a big deal thing as it may seem when the momentum is to go away to school, get into the highest ranked school.</p>
<p>*I remember when friends of ours who had kids a few years before we did said they’d heard that it was necessary to save “$500 per child per month from birth” to fund the college accounts. *</p>
<p>While we did not have enough money to invest in 529 accts, people that did so in our state saw their investment triple by the time their kid was ready to attend college.</p>
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<p>Huh? We are talking about upper-middle-class people lamenting the high cost of private education, and in some cases having a large number of kids in expensive parts of the country. All of these things are choices. Low-income people are not the subject of this thread.</p>
<p>Maybe I misunderstood but somewhere in this thread people were lamenting the fact that more middle to high income people were unhappy with the current FA system because they were being charged to subsidize FA families and were looking for alternatives.</p>
<p>Everybody at every income level has choices. And 4 kids is not really all that many. There are plenty of low income families with 4 kids, too. Telling people they had too many kids bugged me. Sorry.</p>
<p>“Why have a larger family than you could afford?”</p>
<p>That was the question. Hmmmm.</p>
<p>Many people are surprised just as this reporter was how much these schools think they can afford to pay. I see this every year. CC is a different world.</p>
<p>4 kids is not that many? What are you smoking?</p>
<p>Lol!..</p>
<p>Four kids isn’t that many for those who can afford it.
But if you live some where with a high cost of living, four kids may seem like quite a lot.
Certainly many cars fit four or five people semi- comfortably, not a family of six.
[Average</a> cost to raise a kid: $241,080 - Aug. 14, 2013](<a href=“http://money.cnn.com/2013/08/14/pf/cost-children/]Average”>Average cost to raise a kid: $241,080)
If you live in the northeast, you will spend * more * than even the national average.</p>
<p>Re: [Average</a> cost to raise a kid: $241,080 - Aug. 14, 2013](<a href=“http://money.cnn.com/2013/08/14/pf/cost-children/]Average”>Average cost to raise a kid: $241,080)</p>
<p>That’s an average of $13,393 per year. Multiplying by 4 gives $53,573 per year, so the hypothetical $250,000 per year income household will still have over $100,000 left after paying taxes and kid expenses.</p>
<p>The article does say that high income northeasterners will spend $24,783 per year per kid, or $99,133 per year for 4 kids. That still leaves about $60,000 after taxes and lavish spending on the kids for those making $250,000 per year.</p>
<p>On the other hand, lower spenders spend $7,953 per year per kid, or $31,813 for 4 kids. The $250,000 per year household will have $129,000 per year after taxes and kid spending.</p>
<p>So it isn’t like a household making $250,000 per year with 4 kids, even living in an expensive place, should be crying poverty.</p>
<p>No, I agree, my point was that even if your kids don’t go to college, they still will not be cheap to raise even to only 18, and many families semi- support their kids much longer than that.
Which is why we just have two, even though I would have loved more, and they are 8 yrs apart, instead of closer together.</p>
<p>A woman we know recently went back to work, as her children are now both in school. Her husband has had several jobhttp://agplaythings.proboards.com/threads/recent scares which served as a wake up call that things are not all that secure in his field, so she wanted to add a layer of financial security by working. She did find a well paying job. </p>
<p>Except, she’s barely netting anything. Her tax rate is at the highest marginal rate since her DH’s income goes there. Add in the other non negotiables, and she’s at about half right there. She has to drive to work, she has to pay for early morning care, after school care, days off care for school, not to mention make arrangements for driving to extracurriculars, which her kids do not have too many. </p>
<p>Parking, gas,tolls, and she’s way up there, even packing lunch, though eating out with co-workers and contributing to the office pot is something that is a good idea. Updating some equipment and wardrobe, even frugally is an added cost. </p>
<p>The kicker is that her DH has a child in college and one going to college, from a prior marriage, and her added income drives up the PROFILE numbers very high. Far higher than what she is netting. So, yes, sometimes, it doesn’t directly pay in immediate dollars to work.</p>
<p>“The kicker is that her DH has a child in college and one going to college, from a prior marriage, and her added income drives up the PROFILE numbers very high. Far higher than what she is netting. So, yes, sometimes, it doesn’t directly pay in immediate dollars to work”</p>
<p>For sure. If her husband’s salary already bumped her up to the highest rate, she’s paying 39.6% federal income taxes, plus 6.7% FICA, plus 2.9% Medicare, plus her state tax rate. After all those expenses and losing out on the profile, it may be more cost effective to stay home. Then again, it’s not all about the money, but it must be very annoying to work for little pay. At least she can console herself about how much she is donating to the government.</p>
<p>I think the shock of the cost of raising kids starts a lot earlier than college except for the very fortunate.</p>
<p>In the example above, if I were the woman I would keep working even if the dollars didn’t make a big difference right now. If her marriage doesn’t work out or her husband has further career setbacks she will be in a far better position to support herself and her kids if she doesn’t have a big gap on her resume.</p>
<p>^^That’s true. Plus, hopefully she enjoys it and has upward mobility.</p>
<p>I pretty much sacrificed my career for family but I work for retirement benefits, keeping my skills current, and just the mental and social stimulation. Money is secondary (beyond contributing to retirement). As for driving costs, I drove when I was a SAHM because I didn’t really just stay at home. Maybe I’m lucky but I didn’t find I needed to get a whole new wardrobe; I had a base upon to build, and I took time to add more pieces.</p>
<p>There is no question, that in absolute dollars, she is better off staying at home. This has caused a problem with the stepkids and her DH’s ex, as their numbers will likely go up in terms of the already too small fin aid package that the student gets, and really, with added costs to working that we are not even including, it’s all lose, lose. She’s paying to get a job history going and to keep options open.</p>
<p>Cpt: Interesting story. That woman is also earning her right to her own social security benefits, which can be significant if she has a long life span. Hopefully, she is finding some fulfillment in that work, and enjoying the social aspects. That job is making her eligible for higher paying jobs in the future - employers hesitate to hire people who have been out of the work force for many years.</p>
<p>Some people try to space their kids out by 4 years apart so that they don’t have two kids in college at the same time. However, in many states with good state aid and at many colleges that stress need-based aid, you significantly increase the total lifetime aid received by your family if you do have 2 kids in college at the same time.</p>
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<p>Again, perhaps from a strictly financial standpoint. But presumably she has a happy marriage and someone to spend the rest of her life with (who himself is also contributing to retirement, paying down the mortgage, etc.). The college crunch is a short-term situation that can be managed by being realistic about which schools are in the consideration set and perhaps going after merit dollars if the students are strong.</p>