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Warren Buffet and Bill Gates paid/are paying for their children’s education in full, and I believe Bill Gates has said he’s setting them with a small amount of money beyond that – small to Bill Gates could very well mean $1M. There is an enormous difference between telling your child they can count on a future $10 billion inheritance, and paying for their education. No one is saying people from state schools can’t be successful, but I don’t see why someone who can afford it wouldn’t want to pay for the best school their kids can get into. If your kids turn out to be lazy and unappreciative, you can always yank the money at that point – why not assume the best that your kids will still work hard and will appreciate the head start you’re giving them.
My parents have covered room/board/living expenses for four out of five children thus far. They were very involved in helping us look at schools and ensured we were fully aware of the costs we would be incurring. I went to a state university mostly on scholarship (turned down the flagship state U and elite private school because I didn’t want to take out the cost in student loans.) My other siblings have chosen a local state college, a in-state trade school and private school. All of us worked through college to minimize debt load. The fifth kid is still in elementary school, so we’ll see how that works out in the long run.
My parents were always up front and we had a lot of very frank discussions around financing school. Finances in general were always a point of discussion in our household and we were encouraged to both work for the family business and to work other part time jobs in high school. We had Roth IRA’s and also encouraged us to save for college in our own savings accounts.
And trust me when I say, I didn’t come from elite beginnings. Hicks from sticks is probably a more appropriate label.
Walnut – My parents helped me as much as they could, and what they could was what you mention–room, board, and flights home. And I turned out fine. Sure, it be great if I didn’t have law school loans, but given all that my parents sacrificed to give me as many opportunities as possible, no complaints.
This was my parents’ plan…but life happened, job situations changed, and paying for my college was a huge burden for them (and for me). I really wish they had saved something.
My parents saved nothing and life happened, and thanks to need-based and merit-based aid I was able to get through a very good state school without much debt and with zero parental contribution.
If something goes wrong, I would rather have my savings tied up in a retirement account that doesn’t count against my kid on the FAFSA, instead of in a 529 where it all counts towards EFC.
It’s the same pot though.  You can’t cash out of some investments for that.
I save, but want the flexibility of using my money as needed. Plus, I may want capital gains treatment (vs other tax treatment) of long-term savings $.
Ultimately, I want to send my kids to college w/ my house as paid off as possible. And my retirement as funded as possible. The best long term gift I can give them is a solvent momma who is $ savy, so while they can go to community college vs state u vs private u, they’d probably not like it if I had to come live on their couch b/c I spent all my $ on their schooling.
This is our philosophy also. We have a 529 for our son and hope to contribute additional money to his college from another savings account, but ultimately we want to put our money into retirement so he does not have to care for us in our old age. My parents weren’t able to contribute much towards my education, but they do not need any financial support from us and because of their frugality and wise investing, they never will. I have some friends who are now partially or fully supporting their elderly parents and believe me, I’m grateful my parents put their money into retirement instead of my college account.
This. If you are deciding between spending money on college or, for example, extravagant travel or luxury clothes, etc., then probably squirrel some away for college. But every single piece of financial advice I’ve read says save for retirement first and only if you have extra, save for college.
Now that I’m in my mid-thirties I have a lot of friends who are trying to figure out how they’re going to support their aging parents. Don’t put your kids in that position.
I am really curious as to what flexibility you are looking for. You can use it for any college, if you make a non-qualifying withdrawal–then it is a 10% tax on the amount earned (not the original contribution), you can stop and start contribution, others can gift contributions in. If you are looking for a household “slush” fund, then yes–not flexible enough. But that and saving for college are two very different things. 529 is a solid option that depending on the state offers decent tax deductions. There is a movement afoot to create a federal deduction as well–but it is low on the Congressional priority list right now.
I think the “flexibility” they’re referring to is the ability to use the funds in the event of something other than college– like a medical emergency or long-term unemployment. In that case, a 529 doesn’t make sense.
Yes, it is – but you can’t open a 529 without a SSN, so you’ll have to wait until she’s born. Once she’s born and has a SSN, there are a lot of different options…definitely do your research! We just went through the process with our 5 month old son. Good luck!
Actually, you can start the 529 before your child is born. Name yourself as the beneficiary and then change it to the child after she has been born and obtain the SSN. We did this for both kids.
I think the child needs a SSN (so has to be born first).
Yes, that’s the conventional wisdom. I like my kids’ 529 plans. They are age-adjusted portfolios, so the mix of stocks vs bonds changes according to how soon you expect to need the money.
Usually, yes. Remember you can use other states 529 plans also, though if you use your own state’s plan you may get some state tax benefit.
I think 529 is the way to go. In my state, you have to fund it with after-tax dollars (unlike retirement) but we get a state tax credit of 20% up to a certain amount. So if we put in $5k, we essentially get $1k back as a credit on our income taxes. And the money is not taxed when you withdraw it, so all the interest is not taxed. It seems like a pretty good deal compared to retirement and other investment accounts.
Yeah, it basically depends on what your state tax benefit is. Oregon allows you to deduct 529 contributions from state income tax (up to a certain point), and you don’t have to pay federal or state income tax on the gain. This makes the 529 much better for us than if we saved in a different type of account.
First child born a month ago. After a ton of research on conventional savings vs S&P 500 type investment account vs 529, we did a 529.
The Nordstrom posts above reminded me that I forgot to report back on my feedback to them. After the cusp sizes post this week I said I was going to contact Nordstrom to ask that they separate XL and XXL in their filter options so it wouldn’t result in items that were actually a size 12 showing up in a filter meant to show sizes 16 and 18.
I got a response within an hour and she said she has the same issue! She passed along my request to the web team. It can’t hurt to have others request the same thing. As seen above, there is power in numbers!
Ok how did autocorrect do that to my name???
I just discovered Cuyana, and their silk tops are so gorgeous. They’re also a little out of my usual price range for a standard top. Are they worth it?
I don’t have a top, but I have one of their silk dresses and it’s really, really nice. I’ve worn it to a rehearsal dinner, casual nights out, etc. etc. For me it was a splurge but definitely worth it because the quality is top notch and it’s so versatile.
I’ve found their quality to be really high – I have a lot of their things and they’re all going on years without showing wear and generally look new. I’m a huge fan and think they’re totally worth it.
Threadjack to ask–I am obsessed with Cuyana’s aesthetic, does anyone have recs for similar brands?
I’ll be watching the Super Bowl at home with my family — any suggestions for easy dinner/ party food that we can make ahead of time? Thanks!
Chili. Big sandwiches. Guacamole. Nachos.
My other post disappeared.
All the cheese dip, kept warm in the crockpot, plus pigs in blankets (prebake and reheat).
A crock pot of pulled pork or chicken and crusty rolls for sandwiches, broccoli salad, chips and salsa.
Ummm. Gee thanks J Crew for sizing all the way to XXXS, but not larger than XL. Super.
It