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Archive for February, 2018

rethinking college costs

February 6th, 2018 at 11:26 am

So I've been rethinking college costs as I investigate into 529 more. I think I'm going to pass on it for now.

I really have been considering putting more than our $2k/year away for the DK. But since FASFA considers children's accounts more heavily than parents it might make more sense to keep the money in our accounts and use it for that purpose than to ear mark it now.

I see a lot of parents paying out of pocket for college. I know the timing usually works since you are usually making more by the time your kids are 18 than when they are 2. But I wonder if this is the tack to take? I guess there is so much uncertainty about what college will costs. How hard it will be to get in and go? How do you really plan?

That being said we did fund 2017 and 2018 ESA with $2k/year. So my DK 8 in 2nd grade has about $27k and my Dk 5 in kindergarten has $19k. I think it's something. They both lost a lot this week since they are both in VTI only. But at least we are taking the risk.

Assuming college will be $100k if we can manage to save $50k by 18 for both I think $50k over 4 years will be $12k and we could afford to cash flow that.

ceding control of investments

February 5th, 2018 at 12:08 am

Reading TexasHusker's post made me reflect a little. From the start my DH and I had conflicting investment strategies. He believed he could beat the market, I never thought so. So when we met and before we married we had pretty much nothing. We were struggling to stay out of debt and pay our bills. When he got his first job we finally were married (got a green card), and started saving and investing. We each had a Roth IRA and his 401k. We put the 401k into investments chosen by his company and I picked them. Then we agreed to invest our Roth IRA ourselves. We could each choose to invest risky or not. He decided to buy individual stocks. I chose to invest in boring ETFs. I did better than him.

That being said. In around 2010 with the birth of our first child I cede control of my Roth IRA to DH because I fell into deep post-partum depression/anxiety. I was on medications for about 18 months until I was again pregnant. Then I was off for a few months but mid-way again I needed the medications. Please don't say I didn't need it, I did and yes I saw someone and I can describe now as this anxiety of wanting to throw myself off the roof or constant anxiety and fear of being crazy. I wasn't myself until I finished breastfeeding my DK2 at a little over a year so end of 2013. My hormones made me crazy. I suffered a miscarriage as well between DK1 and DK2 hence their 30 months apart instead of 24 months as I planned.

So I handled basically our budget, living expenses, and oversight of taxes. But I relinquished all investment control during this time and I couldn't tell you what we were doing. I could see it from our tax statements but I had no energy to care.

But we lost a ton of money in our Roth IRAs during this time though the market was good. DH was trading oil commodities. Lesson learned. Turned out this lesson made him realize he couldn't beat the market.

So he began investing in index funds and he changed his mentality after losing the money. That also allowed him later to get on board with hands off investing into index/etfs. Tomorrow I'll finally dig into our finances during that time.