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Grandparents give $1k a year and we put in maybe $500 a year.
If they don’t end up with a fully paid college tuition, they will be okay.
My parents always struggled and werent able to give me anything but a roof and home cooked meals after about 15 years old - watching them struggle and expecting to be their retirement plan is a stress I won’t put my kids under so I’d prefer to focus on making sure my kids don’t have to worry about me.
I have 5 kids. I do 4k total into their 529s and 2500 a month into a brokerage account. $34,000 a year with contributions increases. My annual target covers the cost of 1 kid to attend a state school for a year with room and board in todays dollars. I do not believe all of my kids will go to college, but all of my kids will continue education post high school. If any money is left unused I can use for my own early retirement or Able accounts as the situation seems appropriate.
Thanks dads! Really appreciate the data points.
Sounds like a pretty wide range, mostly between $2-10K annually (depending on plan limits), with some other vehicles being explored. Lot of individual variance, doesn't seem like an area where there is crowd consensus, either on the savings target or annual contribution.
Confirms my feeling that you could be all over the map depending on what you assume. But now worried less that I'm missing some obvious wisdom and more that should make a plan that works for our life and assumptions about our daughter's journey.
Check out the Paying For College FB group to see folks encountering the other end of this conversation… enlightening…
Been targeting half of projected need, after other objectives are being met (such as retirement). Any further savings I'll put into a different vehicle if I'm fortunate enough to be in that situation. Also won't put in more annually than the gift exception. This year is 17k/34k.
My goal is to have 200k each for my 2 kids for their college costs. I do 9k/year (monthly payments) for each kid. 15 years at 5% compounding interest should get me there.
How much do you anticipate needing for college? Should be able to back into monthly contributions with an assumed market return from there.
This can explain it better than I can in a single post. Check out the section specifically on taking out a loan against the policy.
https://www.allstate.com/resources/life-insurance/cash-value
We do about 5k a year for the New York 529, starting it now as we plan to try next year. Goal is to save about $230-$250k, roll over $35k into a IRA and the remaining the kid can take a loan (assuming they do private)
We are in MA so we put 2K(max allowed for tax benefits) in MA 529 plan and I have heard good reviews/performance about New York 529 plan, so another 3K(no tax benefit) in NY 529, total 5K per year for now. Started contributing as soon as my kid was born. Hoping that 5K per year should be helpful 18 years from now.
You can find a calculator online for that. I started contributing $160/month for mine when he was born. Projected to have ~$75k for his college which should be enough for the first 3 years and assuming the gift exception will be higher by then.
Yea my college cost $71k in 2011
Rising Star
Max out limit for tax benefits in New York (10K for married filing jointly) but might have to reduce that because of the added cost of childcare for kid number 2
We do $300 per month per kid, started as soon as I got their SSN numbers.
I’m actually foregoing the 529 and setting up a whole life policy for my child. The incentives are better, it’s no brainer when comparing to the 529
@MD1 - The withdrawals should always remain tax-free. By affordable, I actually mean you can structure the policy to whatever is affordable to you. I used to work in insurance and trust me, I do not want to sell you anything, I just understand how to use it as a financial tool especially when the biggest benefit is time accrued
I personally think its better to plan for life rather than 4 (or more) years of college - so for my situation I will personally stick with a whole life. I think this vide will explain how to compare both financial vehicles when deciding whether to use.
I think a 529 can be good in certain instances such as starting to save for college when in mid/high school and attempting to fast track some college saving, but when starting a really young age - imho its getting a life insurance policy.
https://www.youtube.com/watch?v=VPARU_re-ng
$200/mo for each kid
Max out Illinois tax deduction. 20k/year for the first few years and will readjust
Only applies to Illinois 529 above
My wife and I have three kids - 12, 10, and 8.
We opened up IRAs for all of them when they were born and contribute $6500 annually for each.
https://www.kiplinger.com/article/saving/t046-c002-s001-roth-rules-for-kids.html
I max it out every year $10k per kid
Roughly $100-$200 a month.
Will scale upward after we buy our first home but currently saving for that and after paying $3500 per month for a nanny stops 😂😂
Should be able to do 1k per month within the next 3-5 years
Currently doing $1,250/mo total across 3 kids aged 14, 7, and 4. We are definitely behind on the oldest one but on pretty good track for the younger ones (although market has been so brutal the last few years). As others mentioned, you can model what's required based on expected returns and forecasted college costs. If you have a financial advisor, they have this info readily available and run models like that routinely if they're servicing your plan.
I personally expect to have to shell out more monthly or even take out a loan for the oldest, but also expecting/hoping to be a PMD at that point with a lot more disposable income (knock on wood). Also still plan on increasing the monthly 529 contributions further over the coming years, although we've paused it for now while we're pursuing a few other financial priorities.
Like some others $200/mo and then an extra deposit at Birthday & Christmas
10k/year, started funding 529 when our son turned 1 and we’re at ~$60k after 5years. Rate of return has been lower than I expected with a 80/20 stocks/ bonds mix. Hopefully, the next 12 years generate better returns
Same here!