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Author: 2gifts Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 8208  
Subject: Re: Getting started on the college thing Date: 2/12/2011 2:53 PM
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My concern is what actual college costs are. I see these nightmarish figures, but they're all so "average" and "rounded" and all kinds of other things. I don't know how to even begin to understand what college really costs.

Can someone please help me find someplace that will help me break it down?

Is there anything I can do other than save, save, save?


I agree with the save, save, save philosophy.

My twins are currently sophomores in college, and even with me not working for an entire year, they do not qualify for financial aid. That's OK, because most aid is in the form of loans anyhow, and I'd prefer that they come out of college with no debt.

We started saving when they were babies, and continued to add to it through the years.

We only put a very small amount into a 529 because I didn't like the lack of control over how the money was invested, and because with twins, if one child didn't go to college, I wouldn't have a lot of time to change the beneficiary to the other child.

We saved the vast majority of their college money in a taxable account in our names, and we started to move it to cash when they were freshmen in high school finishing when they were sophomores in 2007 so that I would have all 4 years in cash in time for college. That was good because they graduated high school in 2009 which was right after the market meltdown, and quite a lot of their friends' parents did not move the money to cash and could no longer afford for the kids to attend the college of their choice.

We will have our home paid off in about five years. That will give us a full four years before DS1 begins college (almost exactly).

If your mortgage payment is anything like mine, I would think this is more than enough to pay for their college. Given that you'd want to have the college money in cash anyhow at that time, I would say that just putting it aside will be enough to pay for their college.

You might want to decide what you are willing to pay for if you really want to have some real numbers to work with. For instance, if it is that you will only pay for state school tuition, you should be able to find out what that is. If you are willing to pay for any school, know that some costs can be around $50k per year for tuition and room and board.

I have a child at Bentley University and one at Johnson & Wales. The one at J&W gets a very small amount of merit aid, so between the 2 of them, we are paying about $75k-$80k per year, and that started in 2009 and will continue for another 2 years, hopefully, since I am still not sure if DS will manage to do the 4 year program or will stop at the 2 year degree if the extra 2 years prove too difficult for him.

In my case, I'm paying for 8 years of college in 4 years where you will be able to spread it out. I would think that would help you to continue to save and pay-as-you-go as though it were the mortgage payment. I'd calculate how much your annual mortgage payment is, and see how close that gets you to something like $50k per year. That will tell you how much savings you need to do to bridge the gap, assuming you are willing to foot the bill for the pricier schools.

One other thing. If you have a child with special needs as I do, be aware that there are colleges that cater to such kids, but they are among the most expensive schools there are. I knew that and planned accordingly, but that could be a bit of a shock if you needed it and weren't planning for it.
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