contributing to 529k

[sblatner]

We have two kids in college. Yes, we make a nice wage in really expensive California but neither kid got any help worth taking...one had a 4.26 GPA, 2290 SAT, lots of AP, robotics, etc. He was offered $10k in scholarships to go to Carnegie Mellon but it still would have cost us $50k for him to go there. He ended up at Berkeley at half the price. He got no free money from any school he was accepted to except the $10k to go to a really expensive school.

If you get help, great, but I wouldn't count on it.

Also, I believe institutions meet financial need above what your FAFSA says you are supposed to pay. If the FAFSA says you can pay $30k but the school is $60k, the school might offer scholarships to cover the excess $30k but you need to come up with the $30k. They also might offer a mix of loans, scholarships and work studies. It might not all be free money.

I'm a little down on this whole subject as I think people think it is easier to get free money than it is. We have a friend whose parents are poor. The kid went to a private school and ended up with $64k in loans for 3.5 years of school (he graduated early). He is a good student, college soccer player, etc., and didn't get enough to cover his costs.

You can save in a 529 and/or a prepaid tuition plan but I would still save outside of both. If you need it for college, great. If you don't, you can save it for retirement.

[LivingAlmostLarge]

We are just saving anything we can. I'm not even sure we'll get 4 years into an account. Ask me in 5 years how the balances are. I think it depends on when we want to retire and what our needs are. We might just retire early and see if they get financial aid.

[disneysteve]

One thing that I think parents sometimes don't think about is that helping your kids with college costs doesn't have to end at graduation. You aren't limited to what you are able to save before and during college. Maybe you wish you could do more in advance but just couldn't and they ended up needing to take out loans. After graduation, you could help by giving them money toward their loan payments.

Of course, that can work both ways. I've already spoken to our daughter about the possibility of her helping us with paying down the money we borrowed on her behalf once she repays her own loans. She's on track to only owe about $6,000 at graduation which she should have paid off in a couple of years, less if she gets a decent job right away.

[LivingAlmostLarge]

I agree I've always said we'd make paying for college grade based. And if we did that we'd have to take out loans and pay for them based on meeting expectations. So it would be having skin in the game.