The Counter is Ticking
Want to scare yourself to death? Visit Savingforcollege.com and calculate how much money you will need to save to put your child through college from beginning to end, all expenses paid. This sight calculates for you the amount of money you will need to save per month based on your child's current age.
If your child is 13, you have five years to save for college expenses. The "Simplest College Calculator" on the site can adjust for the amount you want to spend. For instance, if you just want to pay for 80 per cent of your child's expenses, expecting your child to work or get a partial scholarship to pay for the rest, you can adjust the calculator down.
If you want to pay for 100% of your child's college expenses, your child is 13, and you haven't saved a penny yet, you would need to start saving around $1,268 per month to afford that kind of an education. It only gets worse the older your child gets, if your child's college savings account is sitting at nil.
The site also has information on 529 College Savings Plans and other savings instruments, but you don't have to buy anything. As the parent of two college-aged children (one in law school) I would advise you to check out this web site today. It will give you an estimate of what you are facing in the way of college costs. You may as well pay yourself, as pay one of the college lending institutions.
Another thing to consider is that loan money is drying up. Restrictions for student achievement to get and maintain student loans are being tightened. If your child cannot maintain a 2.0, loan money probably won't be there anyway.
There are so many things to think about when factoring college costs. Education is the best way to understand the savings process, as well as the borrowing process. The counter is ticking and you want it to tick in your favor, not in interest from college loans.
If your child is 13, you have five years to save for college expenses. The "Simplest College Calculator" on the site can adjust for the amount you want to spend. For instance, if you just want to pay for 80 per cent of your child's expenses, expecting your child to work or get a partial scholarship to pay for the rest, you can adjust the calculator down.
If you want to pay for 100% of your child's college expenses, your child is 13, and you haven't saved a penny yet, you would need to start saving around $1,268 per month to afford that kind of an education. It only gets worse the older your child gets, if your child's college savings account is sitting at nil.
The site also has information on 529 College Savings Plans and other savings instruments, but you don't have to buy anything. As the parent of two college-aged children (one in law school) I would advise you to check out this web site today. It will give you an estimate of what you are facing in the way of college costs. You may as well pay yourself, as pay one of the college lending institutions.
Another thing to consider is that loan money is drying up. Restrictions for student achievement to get and maintain student loans are being tightened. If your child cannot maintain a 2.0, loan money probably won't be there anyway.
There are so many things to think about when factoring college costs. Education is the best way to understand the savings process, as well as the borrowing process. The counter is ticking and you want it to tick in your favor, not in interest from college loans.
posted by Melony Carey and Chrissie Wagner at
10:55 PM
3 Comments:
That is helpful news. Any advice besides what is out there on that website? I have two boys, 8 and 5, very smart, wanting to become med specialists (wonder how their brain got wired that way!!!), do very well in school and so on. Any other tips to save? Hubby makes 112K/year. I stay home. More than half his income is gone in mortgage, cars, gas, and bills. We manage to save $100 for each child. I would love to know your personal experience and advice. I don't want my kids to wash dishes to make it through college.
Thanks in advance,
Amy.
That is from Anu, how did I type somehting else!
Oh, goodness, Anu - keep saving now, even any amount. By my calculations you will have over $12,000 per child and that's a start, but keep in mind that one year of non-commuting college currently costs about $12,000 at a state school. Private and Ivy League schools are a minimum $36,000 per year.
Also, bad news - at your current income level - and surely that will rise significantly over the next 10 years before your oldest is in college - the tuition deduction on income taxes is almost nil and so are need-based scholarships.
Unless you are willing to not buy any new clothes, turn your heat and air way down, or take only one shower per week, and use leftover meatloaf as the base for spaghetti sauce, I can't tell you any way to get more money out of your salary. There is a savings instrument called a 509 Savings Plan into which any family member can contribute and the good news is it's tax deductible without having to file the long form, but you will have to check with your state to see if it participates in the plan and if it's tax deductible.
My best advice in light of your stated income is:
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Make your boys study every night - have a place or time specifically for studying and monitor that they are doing it and continue to do it through their teen years (that's when people relax and stop studying/monitoring), so that it is a habit.
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Practice for the ACT and SAT (but not right now!). Take it several times. It has been my students' experiences that colleges start looking at 27 - 29, but 32-33 is preferred for scholarships at prestigious schools.
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Make them active participants in school, from course work to extracurricular activities and enrichment opportunities such as fieldtrips, summer programs, music lessons, sports teams, etc.
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Now, when they are little, make them save half of all the money they get from birthday presents, yard work/chores/allowance. It doesn't have to be half, but there is a great story about Rockefeller (I think) who taught his children the secrets of financial independence that way. Pay yourself first, in other words, and live on less that you have.
I have had so many students who have tried hard, earned good grades, been magna cum laude, only to find there is no scholarship money for the middle class. So, save, strive for excellence, and make sure your children understand the goal.
Good luck to you and your family!
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