Average college savings for children

[DLgal]

As far as we're concerned, it is up to our kids to fund their own college education. We both had to do it. DH chose to enlist in the military and use an ROTC scholarship to pay for his last three years. He had a loan out for the first year. I had a VERY small college fund that my grandfather had given me, and I had around 10k when I started school. I used that for the first year (state school) and took loans out for the rest. My parents took out a loan to pay for my apartment housing the last three years, as our school did not provide dorms past freshman year. I lived with roommates all those years, and my parents paid appox $5000 per year towards rent and an allowance that covered utilities and food. I also got a job at the end of freshman year and worked steadily about 30 hours per week for the remainder of my college time.

We did open up 529 plans for our kids as soon as they were born. We have contributed $100 monthly to each and we put in half of any money they get as gifts. On each kid's birthday, we make an additional $100 deposit. The point of this is to have some set aside while also being an amount we can EASILY afford to contribute, after our own retirement account contributions are maxed out. I have heard over and over again that kids can take out loans for college, but no one will give you a loan to pay for your retirement and that is SO true. We are not about giving our kids a college education for free. Rather, we want them to understand the value of that education and make smart choices regarding a major and future career path, so that they can easily pay back any student loans they take out. We also plan to suggest they start off at community college and then transfer. And, we are fully prepared to continue to support them at home should they choose to live at home either during or after college or both. Our boys are both on the Autism spectrum, so their future in that regard is VERY murky right now. However, we are preparing for any eventuality with them. If they end up not going to school, we will then have some extra money to help support them as adults, so the 529 plans are essentially insurance of sorts.

We did choose fairly aggressive portfolios with both of them, and they are now 7 and 8 and we have about $16k in the 8 year old's account and about $14K in the younger ones. I think we are doing just fine at this point.

 

[IUTBAM]

We did not set aside money for our DD's education when she was growing up. We opted to fund our retirement plan generously instead. DD worked hard in HS, graduated valedictorian, got a National Merit Scholarship and a few other scholarships, and made her own decision to attend the honors program of a state school here in our own town, so she lives at home and commutes. She's getting an excellent education at the top research school in our state.

If she had chosen to attend a school outside of our town we could have handled the cost beyond what her scholarships cover out of pocket (thankfully my DH's salary has increased 5x from what he was making when she was born). But, we raised her to be practical and frugal, and her choice of college was exactly that. She will graduate with NO debt from either her undergrad or grad/vet school degrees because 1) she made wise choices and worked hard for her scholarships, and AP credits and 2) she chose not to go to a school that cost $50K a year (for which we are eternally grateful lol). We do pay for the care, vet and farrier expenses of her horse (approximately $600 a month) willingly since she made such a practical choice for college. And I didn't even bother filling out the FAFSA after her freshman year since our expected contribution was $40K a year lol.

College can be done without saving up a huge nest egg for it if the student makes practical and frugal choices.

 

[mjkacmom]

In-state tuition here is about $13000, $25000 if you live on campus. Yikes - guess we should've moved! The plan is for dd16 to try to get some merit $ at a lesser school, and then hopefully get need-based $ when the rest of them go (because we are going to be SO POOR). We have about $100,000 saved, which would be awesome, if we only had one kid.

 

[Crystal824]

I'm still paying on my own student loans, DH is as well. Together we owe about $250k in student loans (college and law school for both of us) so...there isn't that much left to save for DD's education. We do put about $50.00 per month in DD's 529. We also put any money she gets for her birthday, Easter, Christmas, etc. in that account. She is only 2 so she doesn't really get the value of money yet. She hasn't asked to keep the money she gets on holidays, and until she does, I will continue to put that money in her 529. When she does ask me to keep it, I plan to offer to match any part of it she wants to save for college. She currently has a little over $4,000 in her 529. If we keep going at this rate she will have about $32,000 for school, which is good but not nearly enough.

I had nothing when I went to college except a tiny bit that I had saved from working in high school. It basically helped cover books and moving expenses nothing for tuition. While I want DD to have something, it will not be enough to cover all her college expenses unless something drastically changes between now and then. I also don't plan to take out loans for her unless that is the only way she can go. I took out my own loans, and she will have to as well. I think it is important to have a little skin in the game.

 

[sunlover13]

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.

Are your kids going to college soon? I have a 10 year old and it's predicted to cost around $200,000 for her 4 years.

We have 529 plans we started when the were born. We put $250 a month in each of their plans. It's not going to be enough, but it will help.

Our retirement is number 1. I don't want them to have to take care of us when we are old. College is next.

Dh and I both paid our own way and we turned out financially responsible.

 

[aprilchem]

We have 3 kids, ages 3,5,7. Our goal is to have $100k saved up for each by age 18. We're pretty much on track for that level. We intend it to cover room and board (I'm a tenured college professor, so they'll get free tuition), plus pay for grad school if they choose to go or serve as a starter fund for a house if they don't.

 

[KennesawNemo]

Are your kids going to college soon? I have a 10 year old and it's predicted to cost around $200,000 for her 4 years.

We have 529 plans we started when the were born. We put $250 a month in each of their plans. It's not going to be enough, but it will help.

Our retirement is number 1. I don't want them to have to take care of us when we are old. College is next.

Dh and I both paid our own way and we turned out financially responsible.

Nah, they are no where near going to college soon. DS is 7 and DD is due this Saturday although I have a feeling she will drag me into next week.

I think 529 will be a very small part of my plan. It's just something there just in case. Also in Georgia, $2000 is the maximum to be state-tax free per kid per year.

I count more on the reduced mortgage payment and higher income aspect.

ETA: Both DH and my parents paid our college education in full, everything paid. We turned out to be fine. We are very finacially responsible. I think I can teach my kids a good sense of money while paying for their college education. I do personally view paying for 4 year in-state college as an obligation, but it's just me.

I agree retirement is No. 1. Our retirement accounts are very well funded. My company also has a pension on top of 401k. By the time DD is in college I should be able to retire early and get full pension. I can also take a 2nd job to bring in more income. That, however, is based on the theory that the pension will still be there.

 

[Tara619]

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.

I agree with this. Our priority now is saving for retirement, not for college. You can get a loan for college but not for retirement and we cant afford to save for both even with 2 full time professional jobs and college degrees. DH is a teacher. DS7 can take out loans like I did. My inlaws are saving for him and have about $10k so far. We'll also push for an in state public school and scholarships.

 

[BeachLove]

Many won't agree with this.

My parents saved about $600 for my education. That's right $600. What it made me do was be a self sufficient person. I paid my way little by little. It made me careful about making sure I took the right classes. Should I learn a trade instead? Is that a better investment? Things like that. Most of the kids I grew up with that had college money given to them didn't care about attending the classes or passing. Many took 6 plus years to finish a 4 year program or dropped out eventually. I feel that IF you save for a college education be open to your child going to trade school, using the money for a home, use it to start a business, etc. Whatever you do don't force your child into college.

 

[dhuba]

We never really saved for our kids college. We just paid as we went and just didn't save much those years. We did make our daughter get the subsidized student loans, which at the time was 2500 for freshman, 3500 for sophomore etc. She wanted to go to a school that was over 40,000 a year so those loans were nothing and she had a scholarship that covered about a third. So we were left to pay a good chunk each year. I didn't feel it was right for her not to pay for anything since she chose this expensive school. She eventually transferred to a different program so we paid 80,000 into her education and she has about 20,000 in loans. Many days I am tempted to write a check to pay off her loans but after all we've been through with her (long story) she needs to pay those herself. My son is still going to a state school where he commutes so we pay that in full so he won't have loans. I'm glad it's all coming to an end so we can start saving more. We pay for his gas and road tolls, which makes it almost better to live up there, but he works fulltime too, and doesn't want to give that up. It's scary to think of all of you with little ones and what it will cost in the future.

 

[Sam81]

Never saved. Both of my children are "gifties" and had full rides to multiple prestigious universities.

 

[ForMyBoys]

We currently save about $400 a month between the 3 kiddos. I've also put in additional lump sums from time to time. We didn't start the fund until my oldest was 5 so I have some catching up to do with him. We plan to raise the amount we put in each year as our incomes rise.

I'm hoping to have about $40k for my oldest by the time he graduates from high school, then progressively more for each kid. BUT I fully expect my kids to try to work for scholarships. Also if we are paying for it we expect to have some say in what they are doing with it and can review their grades, class choices, school choice etc. If they don't want us to have say then they can pay for it on their own.

I also think there is a lot of value in paying for part of your college education. Those first jobs offer great learning experiences.

IF one of my kids gets into an ivy league type school and has their heart set on a certain program AND they have shown the work ethic to complete it we will absolutely do everything we can to help fund it.

 

[gorkt]

Just because my parents paid for my education doesn't mean I frittered it away. I chose a very practical major (engineering) at a good school and finished in 4 years. I trust my kids can make the same good decisions - if they don't seem ready to chose a major, they can wait a year and work without a degree to see what that is like.

I plan on paying for my kids education as much as I can without sacrificing retirement. I have been fortunate enough to get some assistance from their grandparents - they set up UPlans for my kids when they were 1 year old each and it covers 4 years of education at a state school, probably 1.5 at a private school. I also have another $10,000 for each kid that was left to them from a relative and that will go for remaining college expenses. The other part of the plan is once my kids are out of after school care, the money that has been going to pay for that will go into a college fund - so between all that they will be mostly taken care of. Granted, bad things could happen, but at least they will have the UPlans and inheritance money.

 

[crisi]

Never saved. Both of my children are "gifties" and had full rides to multiple prestigious universities.

I'd be terrified to take that chance. My daughter is really bright, but she is flaky and really I don't know if she could have a ninth grade meltdown on grades due to just being her. I know a lot of really bright people, and most of them didn't get the scholarships there parents had counted on. Good for you that yours did, that's great!

 

[Skatermom23]

Never saved. Both of my children are "gifties" and had full rides to multiple prestigious universities.

Well, unless your babies are born reciting their ABC's, I wouldn't count on this. With two in college at the moment, I highly recommend saving whatever you can. No amount is too small and the earlier the better. If it turns out you have "gifties" then you get to go buy a convertible... for yourself!

 

[BadgerGirl84]

I'm not sure how much my DH and I will save for our children, but I don't expect it to be anything substantial. Our focus will be on paying off our home and paying for retirement. We both would like to retire before we hit 65.

Most everyone in my family (me, DH, my sister, my dad...all his 10 brothers and sisters) made it through college without massive debt WITHOUT major contributions from their parents.

I got a full-tuition scholarship to my state's flagship university. My sister went to a technical college for her 1st two years, then transferred to a state university for her BSN. She needed some loans, but she also chose a career and education path that would allow her to pay that debt off. My parents couldn't afford to give us much, and we didn't expect them to. My DH is finishing his BA as an adult and he is paying as he goes.

If DH manage to get our home & cars paid off and have more than enough retirement savings...yes, we would be providing our kids with as much as we could afford. I just don't understand why it would be an expectation that parents did so.

 

[sunlover13]

Nah, they are no where near going to college soon. DS is 7 and DD is due this Saturday although I have a feeling she will drag me into next week.

I think 529 will be a very small part of my plan. It's just something there just in case. Also in Georgia, $2000 is the maximum to be state-tax free per kid per year.

I count more on the reduced mortgage payment and higher income aspect.

ETA: Both DH and my parents paid our college education in full, everything paid. We turned out to be fine. We are very finacially responsible. I think I can teach my kids a good sense of money while paying for their college education. I do personally view paying for 4 year in-state college as an obligation, but it's just me.

I agree retirement is No. 1. Our retirement accounts are very well funded. My company also has a pension on top of 401k. By the time DD is in college I should be able to retire early and get full pension. I can also take a 2nd job to bring in more income. That, however, is based on the theory that the pension will still be there.

Ok. I thought you were saying the $45,000 saved would pay for their college. Congrats on your upcoming addition! My kids are 8 years and 9 days apart.

 

[MrsPete]

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.

We don't actually have accounts labeled "First child's education", etc. We just saved, and we did it the same way you did, Crisi: We worked. We don't have high-paying jobs, but we started saving early, and -- as you said -- we underspent.

We told our girls that we will pay four years of in-state public school tuition and fees, dorm and meal plan -- that is, the basics. We'll buy them each a car at the point they NEED a car (for example, when our oldest begins student nursing as a junior). Anything "above and beyond" -- that is, a fifth year, an apartment, whatever -- they must figure out for themselves.

One year into college, I can say that it's going fine. Our oldest fell in love with not one but two schools that fit our criteria, and thusfar we've spent less than expected. She is very, very aware that she is fortunate to have her education paid, and she is working very hard to do her part: That is, to keep up with her studies and to work towards graduating in four years.

Our backup plan is to suspend new contributions to our retirement account, something that is possible because we've saved religiously since our very first professional paychecks. We have already saved more than the average person who's already retired, so we could "give ourselves a raise", if necessary, for a couple years.

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.

The problem with this theory is that all high school students -- even all who are bound for college can't manage AP classes, and all of them won't pass the AP test.

Dual enrollment in high school and a community college is more of a "sure thing", as any college-bound senior should be able to handle those classes academically.

Since my own child began college, I have picked up on a couple other things that're money-savers:

- Read the college catalog and make a four-year plan. Although the student may change this as time goes on, having a plan helps the student be sure that he or she's scheduling all the right classes to fit this or that requirement. My daughter was all over this, and she's flabberghasted at how many of the kids on her hall just sign up for things, not knowing how they're going to fit into their degree requirements. They even have a free computer program that helps them figure these things out!

- Register the very minute you're able to do so. My daughter was motivated to choose her classes and signed up as soon as she could, but most of her high school friends didn't see the point -- after all, in high school the counselors worked with them, and they always got their first or second choices. What's the big deal? Most of them insisted that they didn't feel ready to register prior to attending orientation. Those who waited missed out on important classes like Biology 101, and that can easily mean that they either attend summer school (more money) or they need a fifth year.

- If you don't get all the classes you want, keep looking. Online registration is so much better than the old-fashioned way we used to register back in the 80s. If you can't get what you want, just keep watching. When she registered for her second semester, my daugther couldn't get into one of her core classes . . . but she watched the computer every day, and eventually someone dropped the class, and she swooped in and grabbed it. Just for funsies, she checked the classes the day after bills were due, and she saw that several seats came open in that class.

- Do not count on your advisor to do your homework for you. You may get a great advisor, you may get someone who really doesn't care. Regardless, no one cares about your degree as much as you do, so read your degree requirements and KNOW what you need to take. Question your advisor, but don't take the lazy way out and assume that he or she is going to spoon feed you everything you need.

- Be realistic when you choose your school. I know so many kids who transfer after a semester or a year -- sometimes it's about money, sometimes it's about academics, or whatever. But transferring, while sometimes the best choice, almost always means extra semesters in school.

Well, unless your babies are born reciting their ABC's, I wouldn't count on this. With two in college at the moment, I highly recommend saving whatever you can. No amount is too small and the earlier the better. If it turns out you have "gifties" then you get to go buy a convertible... for yourself!

I totally agree that this is a dangerous plan. As a high school teacher, I assure you that THE VAST MAJORITY of our students, even the tip-top students, do not receive full-rides. In my daughter's graduating class last year, one student received a full-ride, and it was to a military academy -- not something that appeals to everyone. This year I am aware of exactly one student who has received this type of offer (and at this point in the year, full-rides are usually already offered).

Another big issue is what the student plans to study. If your student wants to be a teacher or a nurse, he or she has a pretty good chance of getting at least a partial scholarship. On the other hand, if your student's going into business, architecture, accounting, art, music -- the list could go on -- it's a whole lot harder. Scholarships in those fields are harder to come by.

A much better plan: Save. If your child ends up getting a big-time scholarship, wonderful! You can retire earlier, travel more, or build a bigger retirement house. There's no downside to saving and not needing the money. There's a HUGE downside to assuming you'll win scholarships.

I'm not sure how much my DH and I will save for our children, but I don't expect it to be anything substantial. Our focus will be on paying off our home and paying for retirement. We both would like to retire before we hit 65.

Most everyone in my family (me, DH, my sister, my dad...all his 10 brothers and sisters) made it through college without massive debt WITHOUT major contributions from their parents.

It's quite possible to pay for your home, save for retirement, and save something for your children's educations. My husband and I aren't big wage earners, but we've done these three things.

I don't know how long ago you and your siblings paid their own way through college, but it's harder than it used to be. I did it in the 80s, and it was HARD. Honestly, it was harder than it should've been: I lived in unsafe places, walked around with holes in my shoes, and sometimes was hungry -- of course, I was used to those things from my teenaged years, so they weren't a big surprise. Today, however, without either help, scholarships, or loans, a slightly-above minimum wage job that one can get with a high school diploma . . . won't see you through a four-year university. It's genuinely much harder than it used to be.

 

[danygirl]

Best thing I did to pay for college - took at a job at the state U. I work 20 hours per week, my kids get half price tuition at any of the schools in my state system, and we have some good schools.

Middle child got a big scholarship from a foundation, which she can use at any university. The first semester she went to community college, the scholarship covered it all. Because I get the tuition discount, DH and I cover tuition. Kids have to cover room and board, because they do have some choices in that. Our U has BEAUTIFUL off campus apartments, the kind with granite counter tops, top of the line stainless appliances, pools, hot tubs, beautiful gyms, etc, for $1350 per month per student. Since they are paying for their own my kids have opted not to pick those apartments, though many of their friends did.

DS had a bad first year, we made him move home and go to CC until he was able to prove he could do it. He paid for that.

make sure your kids can swim, lifeguard is a job they can get on any campus!

 

[Christen99]

We homeschool, and have alternative college plans. My oldest is about to start high school, and has been taking random college classes here and there (special interest). When he is 10th, he will take the proficiency exam and complete his high school at the local community college. When he finishes up his general education, he will also have shaved off 2 years of his bachelor's degree. This is very common in the homeschooling community where we live. We will have saved approximately $20,000 for college, since we aren't paying for private school (we use a public charter, and we receive funding to pay for classes and any curriculum of our choosing). That should help offset any educational costs. He may need to take a student loan out for the remainder, or he may end up with a scholarship...who knows.


We are planning on the same path with our youngest as well.