Average college savings for children

[taraaplin]

Just curious as to what everyone's average college savings is for their children. How do you go about saving for it. We do bright start (although, we just started). By the time my oldest is college age I figured he would only have about ten grand. By that time (8 years from now) that will prob barely cover a year. I am not opposed to him having some college loans (as I do), but what is everyone's typical savings like. I have three boys and have so far figured only about 10 grand for each by the time each is college aged.

 

[drcmk]

I don't have any advice for how to save or how much to save. I do have current information on tuition. We are touring colleges with our HS junior this year. A state school, tuition-only, is about $10,000 per year (east coast, in state). The private schools that we've visited, with room and board, are in the $40,000-55,000 range. That's for 2013.

 

[platamama]

It's frightening to think of what college is going to cost by the time my DD gets there. I've recently started using UPromise and a Upromise Mastercard and am surprised by how much I'm accruing in her 529 plan, just by shopping online. I'm getting 10% back on my purchases so every little bit helps. Just thought I'd throw that idea out there.

 

[3boymthr]

Oldest DS is a Junior in HS but I've been cursed with bad luck in my jobs in recent years. Just started back to work after being laid off for 18 months during which period we used all our savings. While I'm back to work I also took a $30K/yr paycut so no way to put that money back in savings. OTH as I was despairing about what to do I found out that my kids have also been blessed with some very very generous and amazing grandparents - they just informed us that they bought the UPlan for my kids. For Oldest DS the amount they invested was 90% of the tuition at several state schools so even though it's been 10 years and tuition has increased significantly he has 90% tuition paid at these schools when he starts in a year and a half. It's a great program and something to look into if you think your children might be interested in a state school. He'll still have to look for scholarships and take loans to cover room and board and books but at least 50% of his costs will be paid for

 

[disykat]

Since we were paying about 18K year on our mortgage(including the extra 500 we were putting down on our principle each month to pay off early,) we knew paying that off would free up about 18K a year so we did our best and got it paid off the Spring before our oldest started college.

Meanwhile, I was a SAHM and we planned for my income earning potential to cover the rest. When I went back to work part time, we continued to live mostly on one income and I bought pre-paid college units for the kids. We bought two years for each child, which will cover tuition during the overlap years when they are both in school. We're not made of money, we just made buying those units and paying down the mortgage a priority over lots of other things.

It's still stressful at times because my work is sporadic and the whole sequester thing with DH, but our plan has been working very well for us. Our oldest is finishing his second year and we haven't touched his pre-paid account yet. We'll start using that for tuition when both are in next year. His school costs about 25K a year, but is less because he got some small scholarships and works to cover some of his own expenses. He also did a lot of AP and will graduate early, leaving some of his pre-paid units for his brother to use as tuition continues to rise.

We were pretty specific with our kids that we can afford x dollars and we'll only allow them to take minimal loans or they'll lose our support. They knew that options over that amount had to come with scholarships attached to bring it down to that range. Since our budget was about what it costs to go in-state, both ended up with a range of choices to pick from that fell in their budget. (Many privates try to match that range, knowing their competition.)

For us, the fear of it was scarier than the reality and having a concrete plan really helped. You don't have to have the whole thing covered up front. You'll be able to cover some of it as you go. You'll be amazed at the difference even the lower food bill if they're out of the house, the tax break, etc. can make towards covering some of the expenses.

 

[crisi]

I'm atypical - my two kids are in 7th and 8th grade, Right now they each have $160k set aside.

How we did it - I worked, my husband worked - both in fairly well paying jobs. And we underspent.

 

[Colleen27]

We have some savings for the kids but I know it isn't nearly enough. I fully expect, based on existing cost inflation rates and the plans my kids have in mind, to need $25K or so for DS15 and around $175K for DD11. And no, we're not on track to have those amounts put aside. I'm not even trying to guess at what college costs will be like for DD4. I can't imagine the current trajectory can hold that long, but if it did we'd be looking at right around $275K for an in-state undergrad degree but I have to think by that point so many people will be priced out that something will have to give with regard to tuition increases.

How do we do it? We save what we can and plan to figure out the specifics when it is a more immediate concern with more concrete numbers to work with. I'm sure we'll cash-flow quite a bit, and as my girls move out of their private school (private K-8 but they'll attend a public HS) the money we are currently spending on tuition will simply go into their college accounts instead. And I expect there will be some tough discussions to be had about cost-benefit calculations, affordable schools vs dream schools, and other practical factors because I very strongly discourage my kids from taking on anything more than nominal amounts of student loan debt but I'm sure the temptation to borrow for the "perfect" college experience will still be there.

 

[tasha99]

Due to divorce, I was dirt poor when I should have been saving for their college. My approach now is to work more hours in a higher paying job and use that difference for college tuition. (not the sole reason for the switch, but I am leaving the education field for a while to work in private industry--higher rate of pay, and year round work)

 

[3boymthr]

Also, have your child target one of these schools as a dream school. The rating is based upon non loan based financial aid.

http://www.dailyfinance.com/2011/08/02/the-top-10-u-s-colleges-for-financial-aid/

 

[runwad]

We have 3 kids and there is no way we could fund all their college. Our family plan has always been for them to take post secondary/AP classes in high school to get some "free" college credit. My oldest is a jr and is doing this her senior year. I'm not sure she'll have quite a year done of college but pretty close. Then it's off to community college 10 miles down the road. My DH and I saved enough for each kid to pay 2 years tuition there. Then it's off to the main campus and we expect our kids to be able to fund at least 1 year on their own with working and then have to make up the rest with hopefully subsidized stafford loans. I'm hopefully they'll get out of school for less than a car note, then continue to live at home and pay those off before they go out on their own. That's our plan so far. We know we don't have the money for any other choices so there's no college visits for us unless one of them would get a full ride somewhere, doubtful on that.

 

[rainynight]

We live in a city with any college choices around so we will provide room and board for our son. Everything else is on him. Of course he is (and will continue to be) my parents only grandchild so he has 10s of thousands already in saving for him and he's only 4. He's not going to be having any trouble affording college. I am going to encourage him to work as a teen and start saving as well and of course work during college. His daddy has 2 BA degrees and graduated both times with no debt and paid his own way for all of it.

 

[DawnM]

We will pay whatever the current in state 4 year tuition is plus books and supplies if they live at home. If they choose to live away, they need to cover room and board. If they choose a more expensive school, they will need to cover the difference. We figure we will pay somewhere around $7K per year per child is what we will be able to cover.

Right now we are looking into the College Promise program for our kids. They can go to CC the first two years and have it count as their last 2 years of high school and their first two years of college. I don't know that it will work out, but that option is free if they are still in high school. Some people don't like the program for various reasons, but it may suit our children. We need to look into it more.

Dawn

 

[tvguy]

My kids are 4 years apart.

One Grandma gave both my kids $1,000 each on their birthday and $1,000 each for Christmas for college (until they turned 18)
Other Grandma passed away and we put her $25,000 life insurance money in the college fund. We put in $5,000 a year.


By the time the oldest hit college we had $200,000. $1,000 each month came out of our pay checks, and we ended up borrowing an additional $45,000. Oldest burned thru $200,000, youngest has burned thru $50,000 so far.

I cannot emphasis how important it is to save money for college from the day they are born.
Our combined gross income has never been over $100,000 a year. Just a matter of priorites. No smart phones, no big screen TV's, our family car will be 26 years old in October (purchased right after our oldest was born).
For some of our friends, parents night out was a $200 night out with dinner and drinks, for us it was an $18 dinner at Denny's and a bottle of Two Buck Chuck when we got home. But now that my kids are adults, they have made it clear they appreciate what we have done and plan to do the same for their kids. DW and I figured if we took care of them now, they will take care of us when we are in a nursing home.

 

[HM]

We started 529 plans for our two kids sometime when they were in elementary school. Unfortunately the downturn in 2008 really did in our accounts. It took nearly three years to get back to the amount we had actually put in ourselves. At that time it was getting close to our son entering college, so we barely made any extra on our money by the time he started. Where we thought we'd have close to the four years, we've only ended up with two and a half years worth of college expenses for him. And now it looks like he's on a five year plan. Our DD starts school next year and her account's not much better. Our kids are both going to state schools.

 

[DisneyRunner2009]

My DH is a saver. He started saving for the kids education, the day they were born. My oldest DD just graduated from U of M in December. She has no loans. Two things that helped her were AP credits and scholarship money. She went in with 30 credits and over the three and a half years, she finished early, had about $20,000 in academic scholarship money over that time. We were able to pay the remaining tuition out of pocket, again my DH planned ahead. My DD never had to use the money my DH put into the earmerked education fund. She received that money upon graduation. DD number two is a high school sophmore. Now, my DH has 529 plans too. Hopefully, she will be able to get some type of althletic scholarship money and we can pay her tuition out of pocket for her as well. As a side note, some of the best colleges for financial aid are highly selective schools.

 

[goodfood4ursoul]

Oldest DS is a Junior in HS but I've been cursed with bad luck in my jobs in recent years.

This.
The whole topic of saving for college and college in general is so wide and deep, and circumstances are different for every family, every child, and differ greatly from college to college.
Many, many families struggle financially.
Just look at our economy- you know it's true.
But that does not mean that college is not affordable, and I hate to hear people stress out about it.

We just filled out our LAST FAFSA forms this winter.
Our son will graduate from college in May '14.

For 22 years of our marriage we had one income- mostly DH
then for a while just me, and only in the past 2 years have we both been fully employed.

And I make less than 30K.
DH and I are both public servants with an emphasis on servant
We work in a small rural community and while none of the jobs pay well, we have great job satisfaction in making a difference in our community.
We are frugal people, both on the job and at home- no cable, pack lunches, work our farm when we get home.

DS goes to a private Christian university, and before any financial aid hits the cost of one semester is $14,000. It's gone up a little each year.

His fed. financial aid consists of loans- about 4K per semester.
He gets a lot of in-house aid- about 4K per semester.
He applies for as many outside scholarships as he can, receives about $1,500 per semester.
He has a leadership position in his hall that will pay $890 each semester next year and that helps.
And we pay the rest, with help from grandparents who have saved for him since birth.
Last summer, about half his summer earnings went to help pay for his fall semester, so he is invested in this as well.

And it is totally worth it.
He is getting a fabulous education, the community on campus is simply amazing.
There is so much support for students, in their hall, in their classes, so many fun activities, and they have a fabulous career center to help launch them out after graduating.
Huge, growing, busy campus (12,000 students on campus) but intimate family dynamic and strong spiritual foundation.

Re: costs- it helps that he earned an associate degree while in high school, due to AP and dual enrollment classes.
And since he knew what his major would be, he carefully chose classes that would transfer properly instead of simply as electives.
So he is finishing in 3 years instead of 4.

He is considering applying to work at the university because he simply loves it there.
Also, after working 6 months, you can take classes tuition-free- a very nice perk!

I just wanted to share my experience because paying for college can be stressful for families, and we all deal with too much stress as it is~

 

[KennesawNemo]

My goal is to pay for everything for a 4-year in-state college for both kids.

We put $2000 each year in 529plan for each kids. I figure we'll have $35K-$45K for each by the time they enter college.

I live in Georgia. I do expect them to do well in school so that we can get some Hope scholarship.

I expect my mortgage to be significantly lower by then and my income higher, so the extras will be free to use.

Also, my kids will be 8 years apart in college. I can move funds between kids and take time to save again.

 

[angierae]

DD is going to college this fall. She will be attending the local community college and living at home for the first 2-2.5 years (maxing out her transfer credits.) This will cost about $3000 a year. She will work, and live at home. We will pay the majority of that, she will be responsible for some, depending on how much money she's making.

Then she'll transfer to a local four year school which will cost about $13k a year, and continue to live at home. At this point, she will take out loans (I think right now Stafford loans max out at about 5k a year? So she'll have about 10k in loans when she finishes, and I have NO problem with that.

The other 16k will be paid in a combination between her, us, and a smattering of grandparents who have all said they would like to contribute.

I know it's an unpopular opinion when I said that I do not believe I should or should be expected to fully fund her college. But it's how I feel. I will do what I can to help, and I will definitely shell out a good chunk of money. But she will work/take out loans, as well.

Your family may work differently, but this is mine.

 

[cvjw]

There are a couple of things that kids can be doing in high school to help lessen their college costs. They should be taking AP courses in high school, and then pass the AP test with a score of 3 or better. Lots of colleges accept a score of 3 or more, and each high school AP class counts as a college credit (if the test is passed).

Another idea is enrolling your high school junior or senior in a Dual Enrollment Honor Program, if one is available in your area. My 17 year old DS is accepted to our local university next year for their DEHP. He is spending his senior year at college, instead of high school (the college credits also count as high school credits).

Between his AP credits, and his Dual Enrollment credits, he will have a year and a half of college already completed before he enrolls in his "real" college of choice.

This could save parents tens of thousands of dollars if a child is planning on attending an out of state college.

 

[Colleen27]

Right now we are looking into the College Promise program for our kids. They can go to CC the first two years and have it count as their last 2 years of high school and their first two years of college. I don't know that it will work out, but that option is free if they are still in high school. Some people don't like the program for various reasons, but it may suit our children. We need to look into it more.

I'm looking into a similar program for my girls. I'm not worried about my son - he plans on attending a vocational HS program and will have a year's head start on an AS in an in-demand field when he graduates from high school. But our county offers a 5 year program that awards both a HS diploma and an AA in general studies from the local community college, and since my girls are both young for their grade (will graduate at 17) I think the extra year to earn a two-year degree at no expense to us is well worth considering. If they then went on to an in-state school, existing transfer agreements would allow them to enter as juniors and they should be able to finish in 2 or 2.5 years. If they go out of state, it is likely that fewer credits will transfer but they should still be able to shave at least a year off of their time at university.