The truth about the need for financial safety's.

Parent Cafe
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<p>It’s not advertising if you don’t bring it up in the first place. But if FA is brought up to you and you reply, “oh, no, we don’t qualify” there’s nothing wrong with that. </p>

<p>Suze Orman is always saying how wrapped up people’s emotions are in money. She says how she used to think people wouldn’t like her if they knew she didn’t have money. Here we’re seeing the opposite - people afraid folks won’t like them because they DO have money. I maintain being open about finances is the best way. Being open is very different from bragging or advertising.</p>

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<p>I don’t think its unhealthy to not discuss finances with others - maybe its a cultural thing. I did not say that I had not had the discussion with my D who knew what the deal was when she applied to school. She went to lower, middle and high school with middle class to well off students. In the 13 years she was there, I never knew or asked the incomes of her best friends parents though I, of course, went to their homes many times and could get a sense of who was more well off than others.</p>

<p>Also, I do college counseling so I talk to people all the time about how to finance their kids college education, especially those who tend to write off schools simply because they think they can afford them. I just don’t think discussing my own personal choices is relevant. </p>

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<p>Why ■■■■■-foot around the question. Just tell them the truth – “Started saving for college when “name” was a baby and we feel we’re pretty well set”</p>

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<p>Something like:</p>

<p>“Lottery winnings.”
“Vegas was good to us.”
“Uncle Warren.” (Buffett)
“Day trading.”
“Did you see “The Descendants”? Similar family situation.”</p>

<p>And THEN smile and excuse yourself to get another glass of wine.</p>

<p>Everyone laughs, and you get your MYOB point across.</p>

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<p>I think that any of the strategies listed above are appropriate. You might use a variety, depending on the parties inquiring and how nosy they are. I have been shocked by the persistence of some people on CC when an OP has stated pretty plainly that finances won’t be a major consideration. That should be adequate. If the family isn’t prepared, it’s their problem. We have a high EFC, but I never allowed it to intrude on my kids’ application decisions. Things fell into place. I have usually shrugged off inquiries by saying that I have a PowerBall ticket in my wallet that I know will win. </p>

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<p>We are in exactly the same situation, and it comes up frequently, but no one has ever really pressed the issue. In general it comes up when a group is talking about financial aid. I usually say nothing, but if necessary, I just shrug, mumble something about only having one child, married for many years before child arrived, started saving before deciding to have child, been lucky, etc. I don’t think most people are trying to be nosy. They are just flabbergasted that people who live like us could possibly have that much. As others have said, it’s the “millionaires next door syndrome.”</p>

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<p>Actually, people are astounded that we put two kids through pricey private U, considering we live rather simply and have ancient cars that we drive until the mechanic says they are no longer safe to operate (or fix). We have always lived well below our means.</p>

<p>We did get some merit aid for older kiddo but were full pay for the other. We just smiled and said it was the right school for both our kids and they were enjoying their experience there. We were able to pay via current earnings, savings, some help from a relative, and buying some zero coupon bonds when the 1st kiddo was born. It wasn’t easy, but it worked for us. We never talked much about the details with anyone and not many asked us much. We were very glad when they were both done with their degrees!</p>

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<p>We have been saving for 3 kids since their births. 4th kid has autism and didn’t go on past high school. We don’t publicize that we are full pay for any school, but now and then it comes out. S1 was in a small high school where many parents were full pay, but many got and expected merit. </p>

<p>D1’s coach suggested we go to a meeting about getting an athletic scholarship when she was a sophomore. While she is good, the only schools giving her scholarships were ones she would not go to (small state U’s) so I had to say she would not play her sport for money. Unheard of by the coach! So I had to additionally tell them that she could go to her favored schools without merit or athletic money because we had enough saved. Fortunately she received a nice merit scholarship to the LAC she is attending.</p>

<p>When D1 was a senior, her AP Psych teacher asked for a show of hands on who had their FAFSA filed. Most of the class. Who did not? D1 raised her hand, teacher aghast, and says YOUR mother didn’t file that yet? So D1 says that she is full pay, parents won’t allow her to take loans, money in the 529, so mom is not filing it. The teacher says, WOW, I never heard of that. However, I know other kids in his classes over the years were also full pay, but apparently she was the only one in that class.</p>

<p>D2 is a junior; she is also VERY good at her sport, better than D1. There is athletic interest in her, but she will not play for money. D3 athletics is on her radar, along with a merit scholarship. Her response is the same as D1’s, so I guess she heard us say it enough over the years!</p>

<p>We are very fortunate to be in this position. H and I have well-paying jobs that allow us to provide this gift to our children, while still funding retirement. However, we live below our means, own a somewhat large house, drive our cars into the dirt, don’t spend much on entertainment or meals out, splurge on 2 nice vacations a year.</p>

<p>So when asked what are our safeties, I respond that they are the colleges that our kids apply to, they are accepted at, and they want to attend. They they pick.</p>

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<p>Where did $600,000 come from, Miami?</p>

<p>To the OP…again I say…smile and nod…and change the subject. You are under no obligation to share your financial strategies for college with others. </p>

<p>I think it’s rather rude for this to even be a subject of conversation. </p>

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<p>Well, there’s no harm in applying to a “financial safety” even if you have all the college money in the bank. Perhaps another financial crisis a la Lehman Brothers is unlikely, but it’s not impossible. Circumstances can change for anyone – lost jobs, death in the family, Bernie Madoff walks off with your money. Or all three happening in the same year. And heck, if you’re rolling in dough, the cost of another application isn’t going to hit you too hard! </p>

<p>Best of luck to you, I certainly don’t wish bad things to anyone, but we should all be aware they can happen!</p>

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<p>Then you don’t need a financial safety. I know a lot of people in that situation. Nothing new there. Your student’s safety school can be any school that will likely accept him, and he takes care of this business early, he’s done and can focus on reaches in admissions. ONe less factor to have to consider.</p>

<p>I like having a school in the mix that is low cost, regardless, because things can happen. Major job loss with need of funds for something important. I’ve had friends that got caught that way from an adult child than needed a heart transplant and had to come up with $X unexpectedly, to job loss and opportunity to start a business meaning funds were tied up. Having a kid go to the state school instead of private U or get a full tuition remission really makes a difference when thing tighten up financially.</p>

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<p>We were unconstrained in identifying potential colleges for our kids b/c of our savings, current income, and gifts from my parents. Our savings covered 2.5 years, the gifts covered 1.5 years, and our current income flow covered one year. I can’t recall having a conversation with others at that time about how we paid for two private colleges. People weren’t that inquisitive (or nosy). If they had been, I would have told them what I just wrote in my first sentence.</p>

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<p>I’m guessing that Miami is estimating the cost to put one child thru a pricey undergrad and a pricey grad/law/med school…since the OP indicated that they have saved enough to cover the whole nine yards.</p>

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<p>“Where did $600,000 come from, Miami?”
-Pricey UG is about the same as Med. School (or it could be higher). As regural expense for one ($50k tuition +$25k living) x 4 years = $300k, then if you include Grad. School (as OP mentioned, no financial safety is needed in etiher case), then $300k X 2 = $600. It is very easy for me to calculate as we are supporting D. thru Med. School, so I know the price tag when you are NOT concerned with the financial safety. It is about $300k for expensive Med. School including tuition + living + ANY other expenses (like flying to a friend’s wedding and buying a maid of honor dress).</p>

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<p>I got the impression from the OP’s first post that the people asking about financial safeties aren’t just random strangers at a cocktail party; they’re friends with whom they chat about everyday stuff fairly frequently. And since when your kid is a HS senior, college applications are a big part of everyday stuff, the subject probably comes up. These friends probably think they’re giving good advice – “make sure you have a financial safety, not just an admissions safety” – and there’s no need to freeze them out or treat them like they’re rude just for trying to be helpful to people whom they assume are in the same financial boat as they are. </p>

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<p>You don’t get to count the wedding, dress, and flight as an educational expense.</p>

<p>I think $600k is a high estimate, even if the child does nothing but go to school for 7-8 yrs.</p>

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<p>The OP may be trying to put the cat back in the bag, having already revealed to everyone that the application list is composed only of apparently-expensive schools. The others may be curious about whether the OP found a financial aid or scholarship deal that they are not aware of, or concerned that the OP may be in wishful thinking land about the affordability of the apparently-expensive schools.</p>

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<p>I think most people that would bring this up are either (1) assuming you don’t know about the need for a financial safety and trying to be helpful and educate you on the need for one (and it is a fairly good assumption since many many families don’t understand the need and think aid will appear or otherwise use magical thinking), (2) looking for help/information for their own situations or (3) looking for an opportunity to display their wealth of knowledge on the college process or have a discourse on what their children are doing. I’d be surprised if people were asking this to delve into your financial situation. I’d either tell them that you understand the need for a financial safety and have it covered, or maybe suggest that your daughter is still working on her list. Then ask what THEIR financial safeties are.</p>

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<p>Unless you won the lottery please don’t say you were lucky. You were smart and you made decisions that led you to your situation. Having money is now a big negative and widely disparaged, it’s a bad thing to have saved and pay your way in today’s climate. I wouldn’t say in real life that we had no need for financial aid or loans. We practically had to have a throw down with the college counselor that we weren’t bothering to fill out the fafsa. </p>

<p>I’d just turn it around and ask them their opinion on their child’s school choices. And I’d say the list was evolving and we decided as a family to not discuss it until the final decision was made. But certainly talk about the outrage of increased prices, anxiety of admissions, etc.</p>

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<p>I don’t agree with this. Has anyone on this thread, or anywhere on CC, ever been disparaging or sneered at someone for saying that they saved money so they could pay for college? Such people are more likely to receive admiration and praise.</p>

<p>I do think that if OP’s friends have always assumed that OP’s family is in the same situation financially that they’re in, finding out that OP has actually managed to save enough for college through living frugally for years may cause a resentful reaction. But it’s not about resenting someone for having money – it’s about the fact that if they have about the same income as OP, they are made to feel like spendthrifts for having spent money on vacations and new cars rather than on saving for college. Maybe they ought to feel that way – but the point is, nobody likes to feel that way, and they may take it out on the people who made them feel foolish and imprudent.</p>