You're probably right, but it seems counterintuitive to me. Consider what would happen if you invested in a 529 fund that didn't earn anything or (gasp) lost money. You've paid the taxes on your contribution, but still can't claim anything for the purposes of the AOA. It's hardly double dipping.
Kids in college after retirement (lower income version)
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You're probably right, but it seems counterintuitive to me. Consider what would happen if you invested in a 529 fund that didn't earn anything or (gasp) lost money. You've paid the taxes on your contribution, but still can't claim anything for the purposes of the AOA. It's hardly double dipping.
SecondCor521
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Intuition and taxes don't really go hand in hand. If you disagree with the rules, lobby your Congressional representatives - I won't debate them with you here. I'd like to keep this thread a useful reference on how best to pay for college given the status quo.
Sanstar
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West Point worked for our kid. Gave her a first class under grad degree, paycheck while in school, guaranteed job following graduation proved to be an effective academic prep for her eventual graduation from law school at a private college. Course there was that pesky 15 month deployment to a war zone to get through. I used the GI bill for my under grad and DH received tuition assistance from US Army for his grad degree. It surprises me that most families don't consider ROTC or service academies in their college planning.
We have a nephew that graduated from high school in 2015. During his senior year he joined the Air National Guard Reserves. He ended up taking a year and a half “gap year” to go to boot camp and then tech school and is an electrician on C130’s.
He received $10k after completing tech school and will receive another $10k soon. He’s currently going to school full time and receives $760/month on the GI bill while he’s in school. He lives at home and currently pays no rent. He also received some scholarship money. He gets paid for doing guard drill one weekend/month as well. During school breaks he has had the opportunity to pick up temp shifts, for which he makes $27/hr. The kid is socking away money hand over fist. He’s 20 and I’m guessing he has more money than 90% of the kids his age.
Unfortunately, from his parents’ point of view, a full time job may be opening up in his shop and he will most likely apply for it. If he gets it he will probably put school on hold for awhile or take part time classes online as he’ll be making over $50k/year. Initially this wasn’t his intent, but he really likes the job. Hard to disagree with him if he’ll be happy.
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One of my daughters was valedictorian. The other one was in the top 10 of her class. Neither of them got merit scholarships because they decided not to select a Podunk school, and they are not in an "under represented" demographic. The internationally ranked schools like Berkeley get all the valedictorian's they want...no need to offer incentives. Not saying it's impossible, just saying that if you son is not in an under represented group, it's an uphill battle. If you want a decent need based award, you're only part of the way there with low income; your non-retirement assets can't be very sizable either.
retiredunder50
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I didn't see it in the Senate plan (which was much more education friendly), but it could possibly creep in during reconciliation. That would stink for those of us holding lots of paper bonds.
My hand would fall off signing them for cash and then getting a 529 before the year is over. I hope we get the details with more than a few days to go in the year.Thanks for your input, I think I’ll share it with our son. He’s so sure he’ll get in and get scholarships based on grades alone, even though we continuously tell him he will need the other activities too. As I mentioned he is involved in debate, which schools apparently really like. Unfortunately for us, debate camps are quite expensive. Depending on which one camp he goes to we’ll spend approx $8k this summer for a seven-week camp, not including travel expenses.
I’m not so sure he’s in an under-represented group or not. He certainly used to be, but now not so much. Our kids are 1/2 Filipino so are considered Asian-American. There are a few investigations/lawsuits against top schools now discriminating against Asian-American students. Maybe he can pull off being Pacific-Islander, which is under-represented...
eastnortheast
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+1 to this. I currently have three in college. All did quite well in high school (top 10%, high test scores, fair amount of school/non school activities, etc.). I would say that they are all at upper tier colleges/universities, but as sengsational points out, merit scholarships were relatively few and far between.
Our experience is that most awards seem to be need based rather than merit based, especially at the upper tier schools.
+1 to this. I currently have three in college. All did quite well in high school (top 10%, high test scores, fair amount of school/non school activities, etc.). I would say that they are all at upper tier colleges/universities, but as sengsational points out, merit scholarships were relatively few and far between.
Our experience is that most awards seem to be need based rather than merit based, especially at the upper tier schools.
This comports with our experience with public universities. Even when my kiddo located scholarships available through the university that were designated merit-based, the "merit-based" scholarship application required a current FAFSA EFC (expected family contribution) number. The result of this experience lead me to do some research.
I reluctantly came to the conclusion that universities have a "sticker price" and a "typical price" that appears to be set based on ability-to-pay rather than willingness-to-pay. For example, take a look at the website collegefactual.com. Randomly picking a university on this website, Bryn Mawr, we can find out a lot about the net cost of attendance: https://www.collegefactual.com/colleges/bryn-mawr-college/paying-for-college/net-price/?_ga=2.141678130.1811676175.1512264970-1809263372.1512264967. Scroll down and you will see a chart on the net cost of attendance by family income. There's a lot hidden behind these summary statistics, but clicking around this website gives you a better idea of the current trends in higher education costs and helps with planning for college costs.
OP here. Thanks again, everyone. Some thoughts ...
With our oldest we would definitely be looking at both FAFSA and CSS/Profile schools since somewhere like MIT is plausible, while State Unis and others need to be on the list. We have to figure what strategy to pursue when either method could be used. In the coming years we'll have choices about how to contribute to Trad/Roth/taxable (and later to withdraw or transfer between these), so there is flexibility, but there is a playoff between income and assets, where decreasing one increases the other. That's tricky to plan for, especially since the CSS/Profile method is somewhat unknown. Taking loans (including HELOC) is a way of spending your own money, plus interest, without it counting as income or assets, but that involves extra cost, risk and complexity.
There are college planning discussions all over the internet, but one additional ingredient for early retirees is that you basically have a fixed budget. If your kid gets into an expensive school, you may simply not be able to afford it (same for most people) whereas some still-working people may decide they think it's worth it, even if it means working longer.
I feel like we need to fix a budget, e.g. $20k per year (not sure the number), and tell the kids to work with that, or take responsibility for any excess, though I'd rather they'd not have debt. Places like Harvard/MIT are much cheaper than that (according to Net Price Calculators using our anticipated numbers) and local State U is cheap (especially with kid staying home) and some other types of Unis are cheap enough, but most unis seem unaffordable, so we'd cut them from the outset. You have to be discerning consumers and not pay too much.
We plan to try to use the Simplified Needs Test (though it's only for FAFSA) since AGI<$50k is easy to plan for when withdrawing from retirement accounts, and having modest expenses. (The even lower AGI for zero EFC is plausible but a stretch)
But the big difficulty is qualifying to use form 1040A by having no items in this list
FinAid | FinAid for Educators and FAAs | Simplified Needs Test Chart
So you can't need Schedule D, meaning you cannot buy/sell(/own?) any asset which could generate cap gain/loss, so only bank accounts or money market funds in taxable, which may not be otherwise optimal.
No reportable HSA activity. A dormant account is okay, but no contributions or withdrawals.
No Line 21 (Misc income) so if you get ten bucks for jury duty, you could lose thousands in college aid. Etc.
(Alternatively qualify for Free/Reduced School Lunch.)
It's worth planning for this, but things can go wrong.
From the comments, it appears Roth conversions are out, and that generally you don't want to plan on needing any special consideration, even though you may ask. You may be better relying on what a formula/algorithm outputs, rather than having a human scrutinize your situation.
For a while we saved in 529 plans and now have $50k per kid (3 kids) but at some point I realized that from a net worth perspective retirement accounts (and HSA) are far superior to 529s (and we could barely max those retirement/HSA accounts, so they are the priority). The 529 plans really just have some state tax benefits and tax free growth, though these can be clawed back, with penalties too, if not used for qualified expenses. So really 529s are not that great, and I almost regret using them, especially since at the time we weren't maxing all retirement accounts. Still, at least we have these savings for a designated purpose, and it provides part of a budget.
With our oldest we would definitely be looking at both FAFSA and CSS/Profile schools since somewhere like MIT is plausible, while State Unis and others need to be on the list. We have to figure what strategy to pursue when either method could be used. In the coming years we'll have choices about how to contribute to Trad/Roth/taxable (and later to withdraw or transfer between these), so there is flexibility, but there is a playoff between income and assets, where decreasing one increases the other. That's tricky to plan for, especially since the CSS/Profile method is somewhat unknown. Taking loans (including HELOC) is a way of spending your own money, plus interest, without it counting as income or assets, but that involves extra cost, risk and complexity.
There are college planning discussions all over the internet, but one additional ingredient for early retirees is that you basically have a fixed budget. If your kid gets into an expensive school, you may simply not be able to afford it (same for most people) whereas some still-working people may decide they think it's worth it, even if it means working longer.
I feel like we need to fix a budget, e.g. $20k per year (not sure the number), and tell the kids to work with that, or take responsibility for any excess, though I'd rather they'd not have debt. Places like Harvard/MIT are much cheaper than that (according to Net Price Calculators using our anticipated numbers) and local State U is cheap (especially with kid staying home) and some other types of Unis are cheap enough, but most unis seem unaffordable, so we'd cut them from the outset. You have to be discerning consumers and not pay too much.
We plan to try to use the Simplified Needs Test (though it's only for FAFSA) since AGI<$50k is easy to plan for when withdrawing from retirement accounts, and having modest expenses. (The even lower AGI for zero EFC is plausible but a stretch)
But the big difficulty is qualifying to use form 1040A by having no items in this list
FinAid | FinAid for Educators and FAAs | Simplified Needs Test Chart
So you can't need Schedule D, meaning you cannot buy/sell(/own?) any asset which could generate cap gain/loss, so only bank accounts or money market funds in taxable, which may not be otherwise optimal.
No reportable HSA activity. A dormant account is okay, but no contributions or withdrawals.
No Line 21 (Misc income) so if you get ten bucks for jury duty, you could lose thousands in college aid. Etc.
(Alternatively qualify for Free/Reduced School Lunch.)
It's worth planning for this, but things can go wrong.
From the comments, it appears Roth conversions are out, and that generally you don't want to plan on needing any special consideration, even though you may ask. You may be better relying on what a formula/algorithm outputs, rather than having a human scrutinize your situation.
For a while we saved in 529 plans and now have $50k per kid (3 kids) but at some point I realized that from a net worth perspective retirement accounts (and HSA) are far superior to 529s (and we could barely max those retirement/HSA accounts, so they are the priority). The 529 plans really just have some state tax benefits and tax free growth, though these can be clawed back, with penalties too, if not used for qualified expenses. So really 529s are not that great, and I almost regret using them, especially since at the time we weren't maxing all retirement accounts. Still, at least we have these savings for a designated purpose, and it provides part of a budget.
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SecondCor521
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
My flowchart is different than yours. If my kid gets into an expensive school and I think it's worth it and I don't have enough money saved then I will go back to work.
Your comment clarifies for me a tacit assumption I was making. Namely, once I leave my job, my career is over and I can't get back in. Obviously that assumption doesn't apply to everyone, but that's the way I view the finality of leaving. (That's mostly a fact about my general retirement planning, but for college specifically, I realize we have to work with a somewhat fixed budget, and any cost blowout is not an option.)
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daylatedollarshort
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We couldn't have done a $50K AGI for very long but California has a state grant program where the limits for a family were closer to ~$100K so that worked out for us.
We sent our kids articles like the ones below and said if you can make a business case for us to pay more than a public, in state school we will consider it or you can apply what our out of pocket costs would be elsewhere, but otherwise it seems like you can get top salaries like the ones in the Payscale reports from public schools in California:
San Jose State Alums Beat Out Elite School Grads For Tech Jobs - CBS San Francisco
Where to go to college if you want the highest starting salary:
https://www.washingtonpost.com/news...ghest-starting-salary/?utm_term=.cf0e2736c664
Payscale College Salary Reports - 2017 - 2018
https://www.payscale.com/college-salary-report
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duckcalldan
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We are in a very similar situation to yours. Our HS senior has a 1550 SAT, lots of extracurriculars and very rigorous coursework. She also wants to go private rather than in state. She knows the rules; we’re willing to pay costs equaling tuition at a top public in-state school, and she pays the rest. But where to turn for info on schools that are generous with merit aid?
Google “(school name) common data set”. Each US university is required to submit an annual spreadsheet with all kinds of demographic info, including the number and average dollar amount of non need based financial aid given. Here’s an example from George Washington University: https://irp.gwu.edu/sites/irp.gwu.edu/files/downloads/CDS_2016-2017_0.pdf. Scroll down to H2A (same at every school) and that will let you know how generous they are with merit aid.
Another idea is international universities. She’s applying at McGill in Montreal. Sticker price is about equal to flagship in-state, and McGill is one of the top 2 schools in Canada. Lots more international school ideas out there. A good source is the blog Beyond the States.
LOL!
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Another data point / anecdote: I stopped working when I had two kids in college both of whom had no financial aid. The last time I filled out a FAFSA, our taxable income was only about 20% more than the total amount I paid to a college that year.
Despite any formulas or rules, college financial aid offices can see through some of your reported financial information. If you live in ZIP code where the average family income is $100,000 a year and plead that you are broke, then you had better prove it. Otherwise, no financial aid for you.
I always laugh when people are upset that 529 plans are counted towards college expenses. Of course they are! You wouldn't have put any money in a 529 plan that you did not intend to use to pay to a college.
Despite any formulas or rules, college financial aid offices can see through some of your reported financial information. If you live in ZIP code where the average family income is $100,000 a year and plead that you are broke, then you had better prove it. Otherwise, no financial aid for you.
I always laugh when people are upset that 529 plans are counted towards college expenses. Of course they are! You wouldn't have put any money in a 529 plan that you did not intend to use to pay to a college.
We never saved separate money for our child' education ... figured it was all just part of the big family money pot, and it would cost what it cost. When working I fully maxed out whatever tax-advantaged accounts I was able to ... but never bothered with trying to do any kind of tax-advantaged college funding.
We moved to Florida right before our child's senior year of high school, so what with her high grades/scores she qualified for the highest level of the State of Florida's Bright Futures scholarship available to all Florida residents, at different funding levels depending on one's grades. The Bright Futures program was one of (not the only) factors in choosing Pensacola area as our retirement destination.
Although she could have gotten into some more prestigious and/or larger Universities, she chose to attend the well regarded and modestly priced University of West Florida (another factor in choosing Pensacola to move to) where she also copped an additional academic scholarship from the school so she actually made money while doing her undergraduate. One plus to going to that school is that it's easier to stand out in a small pond. We never had to fool with the FAFSA or playing the scholarship game. She was able to live at home during her undergraduate & we funded her books and misc fees not covered by scholarships. I never took any educational deductions on my taxes and she never took any student loans.
We did have a goodly pot of money put back for her college from downsizing our house, so that was the backup plan had scholarships not come forth. We never had to use it.
She left this year for a highly competitive 4 year graduate program at Baylor where she has a full tuition waiver and a 20 hour a week job as a Research Assistant. Most in her cohort came from the Ivy League or other top-flight private Universities.
So, yeah ... I highly recommend good grades, scholarships, planning to retire near a modestly priced State University, and children living at home during their undergraduate as a college funding mechanism .. if one can manage to pull that off.
Being of relatively modest means, had we more than one child to get launched in life I probably wouldn't have retired at 49.
We moved to Florida right before our child's senior year of high school, so what with her high grades/scores she qualified for the highest level of the State of Florida's Bright Futures scholarship available to all Florida residents, at different funding levels depending on one's grades. The Bright Futures program was one of (not the only) factors in choosing Pensacola area as our retirement destination.
Although she could have gotten into some more prestigious and/or larger Universities, she chose to attend the well regarded and modestly priced University of West Florida (another factor in choosing Pensacola to move to) where she also copped an additional academic scholarship from the school so she actually made money while doing her undergraduate. One plus to going to that school is that it's easier to stand out in a small pond. We never had to fool with the FAFSA or playing the scholarship game. She was able to live at home during her undergraduate & we funded her books and misc fees not covered by scholarships. I never took any educational deductions on my taxes and she never took any student loans.
We did have a goodly pot of money put back for her college from downsizing our house, so that was the backup plan had scholarships not come forth. We never had to use it.
She left this year for a highly competitive 4 year graduate program at Baylor where she has a full tuition waiver and a 20 hour a week job as a Research Assistant. Most in her cohort came from the Ivy League or other top-flight private Universities.
So, yeah ... I highly recommend good grades, scholarships, planning to retire near a modestly priced State University, and children living at home during their undergraduate as a college funding mechanism .. if one can manage to pull that off.
Being of relatively modest means, had we more than one child to get launched in life I probably wouldn't have retired at 49.
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SecondCor521
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Following up on this point.
I called the four schools that my son is considering. All four of them said that the admissions office has absolutely no information on the financial aid status of any applicant and so financial aid status has no impact on admissions results.
That being said, I now wonder if the financial aid offers are impacted by how much a school wants a particular student. I have to believe that they are.
What the universities are telling you is a technicality. The essays and other information provided on a college application can give a very good indication of the socio-economic background of an applicant even without FAFSA or CSS information. The common refrain I hear from some folks I know that serve on admissions committees is "perhaps what this student needs is to just be given a chance."
Texas Proud
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From some of the reporting and reading I have done the Ivy schools kinda collude and their offers are similar to a student... IOW, nobody is so far out of line that one school stands out...
Also, some schools do not have a lot of leeway on who they choose... Texas public schools have to accept students that graduate in the top 10%... University of Texas has 75% of their students automatically accepted because of this... but they have been able to lower it to 6% now since they would have more students automatically accepted if not...
https://admissions.utexas.edu/apply/decisions
SecondCor521
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@DrBrisket interesting. I am thinking through what a FA office would think of me and my son based on what they could find out from the application and essay and publicly available data. I am a millionaire next door early FIREee type so I have high assets but low income so the public picture on me is a decidedly mixed bag. In general I think FAFSA schools will be more accessible than CSS/profile schools for my kids because of this.
@TexasProud, funny you should mention automatic admissions there. My Dad grew up in a small town there and got accepted to a Texas public university but they said "Don't waste our time or your parents' money by coming." He got offended, got the "top freshman" academic award, went on to another Texas medical school and became a doctor.
Anyway, my son isn't applying to any Ivy League or similar caliber schools nor any in-state public schools. But he is applying to schools where his grades and test scores put him in the upper half or even upper quartile. He goes to a well-respected IB high school and he also provides "geographic diversity" to his target schools. So I like his chances for admissions to at least some of his target schools.
@TexasProud, funny you should mention automatic admissions there. My Dad grew up in a small town there and got accepted to a Texas public university but they said "Don't waste our time or your parents' money by coming." He got offended, got the "top freshman" academic award, went on to another Texas medical school and became a doctor.
Anyway, my son isn't applying to any Ivy League or similar caliber schools nor any in-state public schools. But he is applying to schools where his grades and test scores put him in the upper half or even upper quartile. He goes to a well-respected IB high school and he also provides "geographic diversity" to his target schools. So I like his chances for admissions to at least some of his target schools.
LOL!
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If your millionaire status involves a non-qualified account (a taxable account), then all that money will be earmarked by colleges for them. If one has to fill out a FAFSA or CSS/profile, then that money will need to be revealed.
If your million(s) is in IRAs or 401(k) or 403(b), then it is off-the-record, but the FAFSA will note your retirement account contributions that you make to reduce your annual income and colleges will assume you can stop those and just give the contributions to them instead.
In other words, they can see some folks who have money, but try to get financial aid. In such cases, they may just offer loans to cover expenses which to me is not really financial aid.
If your million(s) is in IRAs or 401(k) or 403(b), then it is off-the-record, but the FAFSA will note your retirement account contributions that you make to reduce your annual income and colleges will assume you can stop those and just give the contributions to them instead.
In other words, they can see some folks who have money, but try to get financial aid. In such cases, they may just offer loans to cover expenses which to me is not really financial aid.
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SecondCor521
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
I don't want to make this thread just about me and my kids' situation, but just to respond to LOL!s comments:
Without getting into details to protect my privacy, I am planning to qualify for the zero EFC rule on the FAFSA. Qualifying for zero EFC short circuits most of the FAFSA data collection, including information about assets, including taxable accounts.
I don't know much about CSS/profile except that it is much more invasive in terms of data collection and includes things that FAFSA excludes. If I have to fill out the CSS/profile, I think they will be able to understand my situation much better and so I expect less financial aid.
Obviously the net cost of the various schools that my son gets accepted to will be an input to his decision. Currently his projected top six include five FAFSA schools and one CSS/profile school.
I am retired so no longer make retirement account contributions.
I know the FA people are smart, and maybe or even probably they can deduce or infer that I can/would/will pay some amount towards my kids' college. I am just trying to play the game as best I can given my understanding of the rules and staying within my ethical boundaries. It will be interesting to see what happens.
Without getting into details to protect my privacy, I am planning to qualify for the zero EFC rule on the FAFSA. Qualifying for zero EFC short circuits most of the FAFSA data collection, including information about assets, including taxable accounts.
I don't know much about CSS/profile except that it is much more invasive in terms of data collection and includes things that FAFSA excludes. If I have to fill out the CSS/profile, I think they will be able to understand my situation much better and so I expect less financial aid.
Obviously the net cost of the various schools that my son gets accepted to will be an input to his decision. Currently his projected top six include five FAFSA schools and one CSS/profile school.
I am retired so no longer make retirement account contributions.
I know the FA people are smart, and maybe or even probably they can deduce or infer that I can/would/will pay some amount towards my kids' college. I am just trying to play the game as best I can given my understanding of the rules and staying within my ethical boundaries. It will be interesting to see what happens.
daylatedollarshort
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Our kids received grants and from what I read on Forbes others with exempt assets, like businesses and retirement plans, but low taxable income do as well.
From Forbes:
"The Fafsa business loophole. Fafsa, the only aid formula used by most public colleges and many of the less-selective private ones, does not count the value of a small business. “Small” means one with fewer than 100 employees. Mom’s and Pop’s little software firm could be worth $20 million and it won’t show up."
https://www.forbes.com/sites/baldwi...ss-owners-save-on-college-costs/#742f1bb332b5
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SecondCor521
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I'm already on this thread, but 43210 wanted me to explain a little bit what I'm planning here. See http://www.early-retirement.org/forums/f28/moves-due-to-tax-bill-passage-89889.html#post1984358 for context.
My plan is pretty basic. I have a junior and a sophomore in high school who are both college-bound. They are aiming at what I might call second-tier schools - good schools, but not Ivy League and not the level just below Ivy League. You might not recognize the name, but for the degrees they want the schools have good reputations and programs and placement numbers.
I have saved 4 years of public university tuition/room/board/books/fees/travel for each of my three kids (I have a 22 year old who has finished about 2 years of college but is working now and deciding whether to go back and for what). These savings are in a combination of 529's and ESA's.
Like every other parent out there, I'd like to see my kids get the most financial aid and scholarships they can get so the money I have saved will get them across the finish line. I think there is a decent chance that they will get scholarships from the schools since they are not applying to reach schools; they are applying to schools where their grades and test scores will put them in the top quartile of the student body at those universities.
If there is money left over when they all three have degrees, I'll either split it amongst them or save it for potential grandkids' college expenses. If I run short, I'll either go back to work, have them take out loans for their last year or so, or figure out something else.
I have been FIREd for about 2 years now and have a Roth pipeline in progress that is - at least currently - fully funded for the next five years or so, but I'd like to keep feeding it each year as much as possible. Many people Roth convert up to a certain limit; for me I plan to convert this year and next year up to the FAFSA zero EFC limit.
The reason for this year and next year is that those are the two years that will count for my younger two kids' freshman years. I don't have much to back it up, but I like to think that the schools anchor their financial aid packages a little bit to what they offer the freshman year (so they at least minimize the chances of being accused of bait-and-switch).
Another reason is that there is a small chance that I will get outside income and gifts in the next few years that I can use to support myself in the case where my Roth pipeline may get a little starved of funding.
Another option, if my Roth pipeline gets starved of funding, is to bail on the zero EFC limit of $25K and Roth convert up to the higher FAFSA no asset AGI of $50K.
Fortunately for me, the numbers all sort of line up with regards to the zero EFC limit ($25K), what I need to live on (also about $25K), and the funding of my Roth pipeline (also about $25K, obviously).
As I noted in my reply in the other thread, five of the six schools that my junior is looking at are FAFSA schools; one is a CSS profile school. My sophomore wants to go to school in Germany, so I'm not even sure yet how that works. But basically IF my junior likes the CSS profile school AND IF he gets accepted there AND IF he doesn't get accepted to any of the FAFSA schools that he likes better AND IF it turns out to be more expensive AND IF he decides to go there, well, that's a lot of if's but we'll figure it out. While I want to provide him (and the other two) with a college education, he decided last year to use part of his college funding to go to a fairly pricey private high school. It's been a good decision, but one condition of that decision was that his college funding might run out for his junior or senior year of college. So I have that flexibility point as well.
Hope that helps explain. 43210 or others, if you have questions let me know.
My plan is pretty basic. I have a junior and a sophomore in high school who are both college-bound. They are aiming at what I might call second-tier schools - good schools, but not Ivy League and not the level just below Ivy League. You might not recognize the name, but for the degrees they want the schools have good reputations and programs and placement numbers.
I have saved 4 years of public university tuition/room/board/books/fees/travel for each of my three kids (I have a 22 year old who has finished about 2 years of college but is working now and deciding whether to go back and for what). These savings are in a combination of 529's and ESA's.
Like every other parent out there, I'd like to see my kids get the most financial aid and scholarships they can get so the money I have saved will get them across the finish line. I think there is a decent chance that they will get scholarships from the schools since they are not applying to reach schools; they are applying to schools where their grades and test scores will put them in the top quartile of the student body at those universities.
If there is money left over when they all three have degrees, I'll either split it amongst them or save it for potential grandkids' college expenses. If I run short, I'll either go back to work, have them take out loans for their last year or so, or figure out something else.
I have been FIREd for about 2 years now and have a Roth pipeline in progress that is - at least currently - fully funded for the next five years or so, but I'd like to keep feeding it each year as much as possible. Many people Roth convert up to a certain limit; for me I plan to convert this year and next year up to the FAFSA zero EFC limit.
The reason for this year and next year is that those are the two years that will count for my younger two kids' freshman years. I don't have much to back it up, but I like to think that the schools anchor their financial aid packages a little bit to what they offer the freshman year (so they at least minimize the chances of being accused of bait-and-switch).
Another reason is that there is a small chance that I will get outside income and gifts in the next few years that I can use to support myself in the case where my Roth pipeline may get a little starved of funding.
Another option, if my Roth pipeline gets starved of funding, is to bail on the zero EFC limit of $25K and Roth convert up to the higher FAFSA no asset AGI of $50K.
Fortunately for me, the numbers all sort of line up with regards to the zero EFC limit ($25K), what I need to live on (also about $25K), and the funding of my Roth pipeline (also about $25K, obviously).
As I noted in my reply in the other thread, five of the six schools that my junior is looking at are FAFSA schools; one is a CSS profile school. My sophomore wants to go to school in Germany, so I'm not even sure yet how that works. But basically IF my junior likes the CSS profile school AND IF he gets accepted there AND IF he doesn't get accepted to any of the FAFSA schools that he likes better AND IF it turns out to be more expensive AND IF he decides to go there, well, that's a lot of if's but we'll figure it out. While I want to provide him (and the other two) with a college education, he decided last year to use part of his college funding to go to a fairly pricey private high school. It's been a good decision, but one condition of that decision was that his college funding might run out for his junior or senior year of college. So I have that flexibility point as well.
Hope that helps explain. 43210 or others, if you have questions let me know.
