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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.

4 Responses to “rethinking college costs”

  1. Dido Says:

    529 plans are typically owned by parents for the benefit of children so are a parental asset.

  2. Joe Says:

    Dido is correct. The only other consideration is if your state offers a deduction for 529 contributions. I'm in MD and it saves me about 8%.

  3. LivingAlmostLarge Says:

    no tax break.

  4. united states presidential election Says:

    Well-said!You've got a lot of power to save money! I really appreciate your efforts to do something nice - you are working hard. No pointless.

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