will you pay for your children to go to college?

lifeonthehill · December 2013

H and I have been big Dave Ramsey followers and because of this we have managed to pay off over $16,000 dollars of debt in seven months(three of which I was unemployed). We have gotten off track because H is not comfortable with the $1000 dollar E-fund and we decided to switch to saving our 6 months fund instead. We will be done in May and go back to attacking debt until the rest is gone($16,000 more).
We started looking into retirement because we know that is going to be the next step and H happened to flip a few pages ahead and see the section on college funds. He asked if we were planing to do it and I said I wanted to be able to help them in some way. Even if that means making nice sized payments on current loans when the can prove each semester they are doing what needs to be done.
I know paying it so they wouldn't have to would be great but if H didn't have any debt I don't know if we would be in as strong a marriage or have learned so much about finances. I almost feel like I would be robbing them of an experience.

What do you think?

WendyGR · December 2013

My parents didn't pay for mine and I turned out fine :-) I am childfree but if I did have children I wouldn't sweat it if we couldn't pay for it for them. We would help as much as we could if they wanted to go but my retirement would come first.

Xstatic3333 · December 2013

We plan to make some contributions to a 529 for our future LOs but with what we can expect to make, it won't be enough to cover full tuition (except maybe to a local public college). I do also feel like I've learned a lot from dealing with my loans, but families with the ability to pay for school can instill those same lessons other ways.

CuriousKiddosMama · December 2013

Both DH and I paid our own way through college, and it ended up being fine- so don't stress if it isn't something you can't help with. I worked during high school and college and until the last semester was able to manage paying cash for college, so I only ended up with like 5k in loans. DH took out loans and paid them off aggressively after graduation.
We are putting away $ for our kid every month, but our goal isn't to completely fund college, but to fund 1/2 or so. If we can afford more, that's a bonus. Another thing that I"m really stuck on is making sure our kid doesn't know that we are paying. My first room mate had her parents pay for college, and she partied, and got put on probation after the first semester because she never went to class. I'm hoping that if he thinks he's paying for it, he will go to class and do the best he can rather than be a self entitled brat like my roommate. We are planning on giving him any $ he pays toward college over the 1/2 we want him to cover back at graduation.

Ducktale · December 2013

I think we'll help with some but not all, partially because we won't likely be able to afford that, partially because I do think I learned a lot of financial responsibility, life lessons, and info on loans, etc by being responsible for paying my own way, and because I wouldn't want them to squander away their college years if they were going for "free". I would NOT pay a cent toward their college if our retirement wasn't on track. My parents did not pay a dime, I turned out fine. However I do feel like my friends who did not have student loans may have had a little more freedom to take career risks that paid off, or went on for more schooling since they did not have the burden of lots of undergraduate loans/responsibility to start paying immediately. We also delayed having kids by a little to get things in order financially, which would have been done sooner without all the student loans. It would be good for my kids to not start out their "adult" life not tens of thousands in the hole if possible like I did. However if that doesn't happen, that's fine. I never felt like people were going to take care of anything for me, and that if I wanted something I had to earn it. I think this came from being 100% financially independent at age 18.

hoffse · December 2013

Eh we will probably pay for a good chunk of it, if not all of it. When I was applying for colleges I was looking at places like Vanderbilt, Notre Dame, Emory, etc. At the time tuition + expenses ran about $45K per year (living expenses were extra), and there's no way I would have been able to take on that kind of debt as an 18-year-old. My parents were willing to pay for most of it, but did tell me I had to save then $75K over the 4 years if I wanted to go to any of them, and they would pay the difference. They said I could save them that money however I wanted - through loans, through scholarships, etc. I ended up choosing Vandy because I got a $60K scholarship through the school, and then I won $10K more through outside scholarships I applied for. I had a part-time job on campus that I used to pay back the remaining balance of $5K. I paid that back to my parents 3 days before I started law school.

So while my parents paid, and even though I didn't have federal loans, I had a massive incentive not to party it away - I had to keep a 3.0 GPA at Vandy to keep my $60K scholarship. And frankly, a school like that is a place where even the partiers study. A lot. Flunking out is not cool. Nor is staying more than 4 years. Something like 93% of their students graduate in 4 years. Vandy turned out beautifully for me - I graudated in 4 years with 3 majors, and I was actually admitted to Vandy law school as a freshman in college. I did apply to other law schools, but I had guaranteed admission to Vandy, so it let me be more selective.

My H went to Emory. Similar experience, though he ended up taking out about $10K in undergraduate loans. He also graduated in 4 years, and ended up being the first student to graduate with a music composition degree. 3 weeks before graduation, the biggest law firm in Atlanta called HIM and offered him a job on the spot. He didn't even have to apply or interview for his first job. When he left to go to law school, that same firm offered him a job upon graduation - and they offered ME one too to try to intice him to come back. We didn't take it. But we could have.

Our parent-funded undergraduate educations opened doors for both of us to have some amazing experiences in college and after graduation. Most importantly, the schools we went to enabled us to get 1/2 tuition scholarships to the law school of our choice (we both went to Vandy for law school). Combined with minimal undergraduate debt, that has given us massive financial flexibility and has enabled us to pursue opportunities that our peers simply couldn't afford to do.

So that's why we will probably pay for our children. Undergraduate education is very important to us, and if our kids can get into Vandy, Emory, Notre Dame, Georgetown, Standford, Harvard, wherever, we don't want money to prevent them from going. By the time they are 18, costs are projected to be around $100K/year or more for tier 1 private schools. And state schools are projected to be in the $40K range. We won't be able to bring ourselves to saddle our kids with that much debt at such a young age.

All that said, retirement does come first. We will be able to afford to do it for our kids so we will do it. But if we couldn't fund our retirement in full, our kids would be on their own.

brij2006 · December 2013

We plan to put money aside for our children for college, but we will never tell them that we have that money. If they go to college and graduate, then we will hand them a check at the end for what their student loans are. If they drop out halfway through, then it's up to them to pay off their student loans.

Yes, we understand that we would then be paying interest over that course of 4 years they're in school and those student loans are in their name. But H's parents paid for 2/3rds of his college, and he partied and didn't care. I paid for all of mine, and rarely ever partied and did what it took to get as many scholarships and pay down the loans while in school.

So we want to set money aside for it, but there's stipulations on whether they receive that money or not.

Mom987 · December 2013

Unless our kids are super involved in sports and extracurricular, they'll have a part time job in high school. I do want them to contribute some towards college. We are saving each month towards college, but that's just to help us at that time, not to cover 100%.

vlagrl29 · December 2013

my parents didn't pay for mine and I think it's a good thing for learning responsibility. I would rather us be able to retire really well. we do have a savings for DD and the money we get from recycling, ebates, and any settlement claims I get in the mail goes into it. It's not a ton of money but we will plan on investing it at some point. It will help her but not pay for college 100%. Even DH had to pay part of his college, his parents paid the other half. We both agree that she can pay for it....we aren't made of money although that would be nice

sillygoosegirl · December 2013

Retirement is our first priority, but we'd like to be able to pay 80% or so of the cost of college for them. We know that smart motivated students will find a way to put themselves through school, and while we want to help them with that, we think it's most important that we don't burden them with taking care of us in our old age.

Like Alyssa, I think that having and paying down that SL debt was a good experience, and I think paying for part of college made us more invested. We had around $40K between us when we got married, but that was with our parents paying the lion's share of our private school education, and historically low interest rates. Without their help, we would have had well over $100K each, and I think that would have been a huge burden that would have taken away a lot of options.

Like hoffse, I feel that my top tier private education openned doors for me that most people don't get. Actually, at graduation I wondered if I'd squandered my parents money, but time and time again in the decade since graduation, I find myself way ahead of peers with otherwise similar backgrounds, and I believe it's mainly the higher quality education I received.

Finally, I'd like to help our kids financially if they want to join the Peace Corp or do something else low-paying but for the general good for a little while after graduation. I really wanted to spend a couple years in the Peace Corp after graduation, but I was really concerned about my debt and how it would grow while I was gone. I'd like to be able to make interest only payments on our kids' student loan debt to allow them to do Peace Corp or similar if they were so motivated.

I don't know yet if we'll be able to afford all that or not, on top of our own retirement, but it's what I want.

cbee817 · December 2013

We're hoping to have $100,000 saved for each- if they want to go to a private school or somewhere far away, it's up to them to come up with the rest. I went to a state school, stayed home, and had a partial scholarship- came out of undergrad with $0 in loans and my work paid for grad school except for $1,000 in fees (transportation, technology, etc). DH also went to a state school, stayed home, but his parents didn't help at all for undergrad or grad school. We paid off $37,000 in loans in January 2013.. it's not a ton, but it was still a burden. I don't want my girls to have that so hopefully we can start them out on the right foot as young adults.

vpine · December 2013

I'm with Wendy on this - My parents didn't pay for mine and I turned out fine

Wulfgar · December 2013

I will be almost 60 by the time that my LO will be ready for college. For me, retirement will have to come first. We did set up a 529 that we are putting $25 a month into for him. Our goal is to pay for a good foundation for him, at least through 8th grade so that he can get into a better local high school if we can't put him into a good Catholic High School. Our hope is that he will get a good scholarship offer or take up a sport that will give him a scholarship to help on college costs.

emily1004 · December 2013

No kids, but if we ever do I will set it up through the state education trust. The plan is good in our state and we have great public universities here. If they want to go out of state or private they are on their own and they will get nothing from us. That's going to be our deal. My H's parents paid for his via the trust, and I had to pay for my last two years. I had my student loans paid off in less than four years. We are huge advocates and products of public education and we turned out great. BUT, Retirement first. That's just common "financial" sense.

apa1620 · December 2013

Definitely make sure you're financially on track for retirement first. You can help the LOs as much as you want for college, but if they end up having to support you after retirement, is it really worth it? Kids paying for their own college helps build character. I paid and borrowed my way through college and I'm currently paying off my student loans. However, it's forced me to become more financially responsible.

chicagobride_07 · December 2013

Probably to the extent that we are able. My parents paid for my undergrad and grad school. They put parameters around the school I could attend (it was a top tier public university) to keep costs under control. I was disqualified from any need based aid at private schools due to my parents income.

At a projected $100K/year for a private school, I really don't see how a kid could finance that themselves without taking out massive student loans. It's not like a student job at a local mall is going to even put a dent in that.

sccrmgoldie · December 2013

I think it's very individual. I believe in helping but like other posters only if my own retirement/finances are in order. We expect our child to cover his own living expenses if he lives away from home, or if he elects to save money and live at home we would charge 100/week. I plan on covering up to the cost of attendance to the local state college as long as he maintains a 3.0 GPA and works 8 hours a week. Anything else he is on his own with scholarships, grants, loans, or making cash. I think that's fair.

mhwood · December 2013

In our case, we agreed that we would give my daughter money for her first year. She is required to apply for bursaries, and scholarships. Anything left over will be rolled over to the next year.

If she fails a course, she'll be required to pay us back for that course.

mrsvieira28 · December 2013

I am one of 6 kids so I didn't get any help with my college tuition. However I am the only one who went to college and am still going working on my 4th degree. Lol. We have 1 child so far and we set up an account for her when she was born and we have managed to put money away for her for the past 7 years in hopes she will use it for college. I'm not sure if we will be able to pay for all of it but I do expect her to contribute to her education in some way. Hubby & I decided that if she should choose not to go to college then we will use the money to either pay for her wedding (which we will have to do anyway ) or give it to her for a down payment on a house someday. But I don't want to just give her the money because I want her to be responsible and level headed. I think it's great if a parent can pay or help pay for their child's education but it's not necessary. We do what we can for our children but they do have to learn to be independent because let's face it .. We won't be around forever.

SmrBrd2012 · December 2013

We will most likely help pay at least part of it. We'll also be teaching them that it will be important to work and save up for part of college while they are in high school (unless as someone else said they are heavily involved in other extracurriculars). I worked during HS and saved what I could do go towards it and got summer jobs every vacation. My brother worked but he always spent all his $ on whatever he wanted. He is paying for it now as he still has school loans and I don't. I would also probably heavily encourage them to go to a state school. We have some good ones where I'm from.

pastalady · December 2013

I mostly lurk here but we are funding a college savings plan for DD. Here in Canada we receive grants matching 20 percent of our contributions to a maximum amount. DD's account will have more than enough to pay for a 4 year degree. If she chooses not to go to school, we don't get the grant money but we still get the interest.

So many things can affect saving for college. We received an autism diagnosis. One of my earlier thoughts was will she even be able to attend college? Saving every month is our way to show her we believe in her. DH and I never had student loans, and we want to start her off with no debt.

Our retirement savings are being funded well, we have savings and no debt besides our home so we save for college. Other things would come first if needed.

nicolen08 · January 2014

Yes. I don't have student debt, and that has been a great blessing. Out of nowhere, I became extremely ill during my last year of school, and now that I'm educated I cannot work full time due to my illness. I think if it's possible, pay for the school because it can really open up doors for people and remove stress. If I had 200 grand in loans (that is the value of my education), I'd be really depressed right now. I paid for my school with scholarships, but, that's not always possible, and so if I can afford to help my kids I will.

orangehills · January 2014

I plan to have a savings account just for their future. Not a 529, because if they don't go to college, this money can be used for some kind of other schooling. I want to help out as much as I can, but I'm not going to go overboard saving for them if that means not putting as much into retirement or having some vacations throughout their life. They can go to a junior college, or work their butt off for scholarships and work to save money as well. I had to do some of that and I was the better for it!

will you pay for your children to go to college?

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