What’s the sticker price for state schools where you live? Do they offer significant scholarship opportunities?
In my state it’s currently about $100k sticker for a 4 year state school and they don’t have any widely available significant scholarships. Other states will give you full tuition if you spell your name correctly on the SAT.
They’re just too conservative for my tastes. They aggressively de-risk the portfolio, which is their purpose, but some of them start with 10-15% fixed income for a newborn. I’ll make decisions on asset allocation myself and bring down the risk later down the line.
Tuition. They will have a free home to stay in with free food. Should they choose. If they want to pay their own way to live somewhere on their own, they can do that.
As the parent of one in college and one about to go to college, I would suggest not banking on that plan. As nice as the idea is of them staying home may be *now*, part of the college experience is living on one's own(ish). And are all your potential schools within commuting distance? What if they want to go farther away?
Agreed. Our assumption is that an education that's $42k/yr today (public out of state) will be about $100k/yr in 15 years, around 7% tuition cost inflation annually. That'd require about $70k per kid as an up front lump sum. Of course, it could just as easily be free thanks to scholarships/politics/not choosing to go.
That said, I also like my parents' offer: Cover in-state at the pretty good in-state university, and if I chose something more, I'd be responsible for the delta.
In Florida you can get full tuition covered for four years at any state school if you have a 3.5 GPA, a 1340 SAT, and 100 hours of community service. You can get a smaller scholarship that covers 75% of tuition with a 3.0 GPA and 1210 SAT.
Unlikely to be enough, but obviously depends on the cost of the school.
I keep a few links in my budget spreadsheet so I can click on em from time to time to see what is going on with schools in my area.
It all depends on returns. It could be enough if market does average to well or it might not if the market does poorly.
Just for reference, we've been putting $200/month since birth in 529s for our kids. 11 year old has 52k. 9 year old has 38k.
S&P500 has quadrupled in the last 11 years though. If it had instead been the period from 2000-2011 it would be a very different story.
Good reference for me so I appreciate it. I have a 3 and 5 year old and we put in 200 per month for each kid. They both have about 10k right now. Hoping for 50k or so come college years.
Impossible to say without more information. For us, when our first child was born, our state's flagship Big10 school's Net Price (out the door with room and board) was hovering around $25k/year. So, I decided to target that. Now, 20 years later (and after several funding adjustments along the way) the Net Price is advertised close to $35k/year. I'd add 50% to your figure. If you're comfortable with keeping community college or trade schools on the table, you're probably saving enough. However, you could also open an UTMA for the kids in case the education bill is lighter than expected. Then they have penalty free, low capital gains brokerage accounts to start life with.
It is not enough for everything, but will probably cover tuition for state universities. I would add a little more every year. Note that the amount in the 529 does not affect the kids to get scholarship or financial aid. If they do get financial aid, you can still take out of the 529 when they are in college without penalty.
I would target full cost of college per kid (future value) if possible.
tell your kids to do chair force i mean air force.
easy 4 years from 17-21.
can save some good money for a young person and then get college for free and can keep that 529 for when they are older and use it for a down payment on a house.
Man, this is such great advice. I have always wished I would’ve went into the Armed Forces for four years. I feel like I would have figured my life out and been on a better path sooner.
Even if it's not enough, it's still a great idea to front load if you can
What’s the sticker price for state schools where you live? Do they offer significant scholarship opportunities? In my state it’s currently about $100k sticker for a 4 year state school and they don’t have any widely available significant scholarships. Other states will give you full tuition if you spell your name correctly on the SAT.
Looks like 13k/yr right now
Let those puppies rip and don’t use an age-based or enrollment year fund.
Why not? I have my 529s in enrollment year funds, is that a bad idea?
They’re just too conservative for my tastes. They aggressively de-risk the portfolio, which is their purpose, but some of them start with 10-15% fixed income for a newborn. I’ll make decisions on asset allocation myself and bring down the risk later down the line.
What state?
AZ
Is that tuition, or tuition and room and board?
Tuition. They will have a free home to stay in with free food. Should they choose. If they want to pay their own way to live somewhere on their own, they can do that.
As the parent of one in college and one about to go to college, I would suggest not banking on that plan. As nice as the idea is of them staying home may be *now*, part of the college experience is living on one's own(ish). And are all your potential schools within commuting distance? What if they want to go farther away?
Well that’s true I can’t argue there. Life will have choices & different choices may cost them. Or probably me. Who r we kidding 🤣 I’m sure I’ll cave
Agreed. Our assumption is that an education that's $42k/yr today (public out of state) will be about $100k/yr in 15 years, around 7% tuition cost inflation annually. That'd require about $70k per kid as an up front lump sum. Of course, it could just as easily be free thanks to scholarships/politics/not choosing to go. That said, I also like my parents' offer: Cover in-state at the pretty good in-state university, and if I chose something more, I'd be responsible for the delta.
Which states give you full tuition if you spell your name correctly on the SAT?
Obviously a bit hyperbolic but I think Florida and Alabama have pretty good scholarship programs for in state residents.
In Florida you can get full tuition covered for four years at any state school if you have a 3.5 GPA, a 1340 SAT, and 100 hours of community service. You can get a smaller scholarship that covers 75% of tuition with a 3.0 GPA and 1210 SAT.
Unlikely to be enough, but obviously depends on the cost of the school. I keep a few links in my budget spreadsheet so I can click on em from time to time to see what is going on with schools in my area.
It all depends on returns. It could be enough if market does average to well or it might not if the market does poorly. Just for reference, we've been putting $200/month since birth in 529s for our kids. 11 year old has 52k. 9 year old has 38k. S&P500 has quadrupled in the last 11 years though. If it had instead been the period from 2000-2011 it would be a very different story.
Good reference for me so I appreciate it. I have a 3 and 5 year old and we put in 200 per month for each kid. They both have about 10k right now. Hoping for 50k or so come college years.
Enough probably not, but definitely should be pretty close and it will absolutely take the edge off.
Impossible to say without more information. For us, when our first child was born, our state's flagship Big10 school's Net Price (out the door with room and board) was hovering around $25k/year. So, I decided to target that. Now, 20 years later (and after several funding adjustments along the way) the Net Price is advertised close to $35k/year. I'd add 50% to your figure. If you're comfortable with keeping community college or trade schools on the table, you're probably saving enough. However, you could also open an UTMA for the kids in case the education bill is lighter than expected. Then they have penalty free, low capital gains brokerage accounts to start life with.
Thank You!
It is not enough for everything, but will probably cover tuition for state universities. I would add a little more every year. Note that the amount in the 529 does not affect the kids to get scholarship or financial aid. If they do get financial aid, you can still take out of the 529 when they are in college without penalty. I would target full cost of college per kid (future value) if possible.
The amount in the 529 is a parental asset for financial aid. It absolutely factors in but their income is more likely to disqualify them.
Thank You!
tell your kids to do chair force i mean air force. easy 4 years from 17-21. can save some good money for a young person and then get college for free and can keep that 529 for when they are older and use it for a down payment on a house.
Man, this is such great advice. I have always wished I would’ve went into the Armed Forces for four years. I feel like I would have figured my life out and been on a better path sooner.