pushing out retirement to help kids with college

[rodi]

Here are my thoughts on the subject... take them for what their worth (not much)....

Assuming you've been honest with yourself about your retirement budget (haven't underestimated things)... you might find there are *easy* changes you can make, to reduce expenses, once you retire. After all you won't be commuting anymore, no need for dry cleaners, and your liquor bill might drop. Perhaps even medical bills going down as you find the time to relax, exercise, maybe do yoga to work on the muscle/joint issues you're having. You'll have time to focus on your health and quality of life. I was surprised at how much less we were spending once retired... Cooking at home as a hobby, vs expensive meals out. Favorite daily activity is a 2 mile walk on the beach with the dog every morning - great for my mental and physical health.

So look hard at your budget... does it seem likely that there may be opportunities to spend less than your 99% plan? If so, that can help offset any college funding you choose to make.

Funding college for kids is a nice goal - but not required in the parenting handbook. We chose to fund 529's monthly from when the kids were born... and are in a pretty good place for when our high schoolers hit universities in the next few years... as long as they go to public school. If we didn't have the 529 funds earmarked for them, we'd look at other ways to help them out... including having them stay at home or helping them with the finaid applications.

As mentioned above - your health is important... IMO more important than helping the kids through college...

I'd re-examine the retirement planned spending and see if prudent frugal cuts can make it possible to protect your health AND pay for 2 years of your son's college.

 

[KenZ71]

Wife & I are planning to tell our cherubs - 10 & 15 - it's all them. Then when they are in late 20s give a large check. Idea being they will work harder / play less while in school.

Besides, if by college age they can't sort stuff in life to get by I've failed as a parent. Time for me (parent) & them (kids) to try a different approach.

 

[pb4uski]

Wife & I are planning to tell our cherubs - 10 & 15 - it's all them. Then when they are in late 20s give a large check. Idea being they will work harder / play less while in school.

Besides, if by college age they can't sort stuff in life to get by I've failed as a parent. Time for me (parent) & them (kids) to try a different approach.

Good luck with that.

I don't see that as being a practical approach in this day and age, so let us know how it works out for them.

 

[Bigdawg]

Good luck with that.

I don't see that as being a practical approach in this day and age, so let us know how it works out for them.

I am surrounded daily by people young and old who's parents DID not pay for their college. A good percentage (I would say half) got their degree's the unconventional way. Slowely, out of pocket as they lived their lives. Many not receiving their undergrad prior to age 30. My DN (35 years old) recently told me that the best thing that happened to him is when he was cut off financially. He bought his first house a few months ago. I am very proud of him him. Too bad he will probably have to take care of his mom(my sister). Long story there.

Best of luck to OP.

 

[Golden sunsets]

Wife & I are planning to tell our cherubs - 10 & 15 - it's all them. Then when they are in late 20s give a large check. Idea being they will work harder / play less while in school.



Besides, if by college age they can't sort stuff in life to get by I've failed as a parent. Time for me (parent) & them (kids) to try a different approach.

I assume that when you say “it’s all them” you mean that you aren’t going to help pay for college. That’s your perogative, although if you can afford to help, I’m not sure why you would not choose to help. Your statement though, that “if by college they can’t sort it out” suggests to me that your expectations are unrealistic. I have 2 launched children, ages 35 and 33, who have been very successful professionally, but they sure as heck had not figured it out by the time they were in college. We were happy to continue to guide them through their 20’s and feel that they are socially and professionally successful. It takes time and patience.

 

[pb4uski]

I am surrounded daily by people young and old who's parents DID not pay for their college. A good percentage (I would say half) got their degree's the unconventional way. Slowely, out of pocket as they lived their lives. Many not receiving their undergrad prior to age 30. My DN (35 years old) recently told me that the best thing that happened to him is when he was cut off financially. He bought his first house a few months ago. I am very proud of him him. Too bad he will probably have to take care of his mom(my sister). Long story there.

Best of luck to OP.

That may be good for some kids.... but it makes life more difficult that it needs to be if the parents have some means. In the case of those not getting their undergrad prior to 30, realistically they start out 8 years behind their peers in career development.

While I totally agree that kids should have skin the game with respect to post-secondary education, given how expensive it has become if parents have means to help its is good. IME, kids are still developing intellectually emotionally from 18 to 24 or so.

 

[Brat]

We helped our children with college expenses and they applied for financial assistance at their universities. They also applied for college loans. They hustled academically and worked as their schedules permitted. Over time we paid off their college loans but in all honestly one grabbed a brass ring so maybe we should have not paid that loan off so quickly.

My advice is not to delay your retirement given your health. Sit down with your spouse, kids and be honest about the choices you face. If you develop health problems as a result of your employment you won't be able to help with college expenses. Ask each their goals and a proposal to finance their education. They could attend a local Community College for a year or two to complete required classes, make sure that the CC recognizes the classes the would take.

Encourage them to apply at the schools the would like to attend. Remember if you are retired the FAFSA (or whatever they call it these days) will reflect lower family income. See what the schools offer. Do not expect your children to pay you back.

The son who wants a degree in Environmental Science should visit the school's placement office to see where the other graduates landed.

My nephew earned an Associates degree from Portland Community College then continued with https://www.wgu.edu/lp/general?refer_id=73306&ch=PDSRCH while working full time and earned a Batchelor's Degree in Business Administration. https://www.wgu.edu/#close He didn't borrow a dime.

It can be done.

 

[Bestwifeever]

Wife & I are planning to tell our cherubs - 10 & 15 - it's all them. Then when they are in late 20s give a large check. Idea being they will work harder / play less while in school.

Besides, if by college age they can't sort stuff in life to get by I've failed as a parent. Time for me (parent) & them (kids) to try a different approach.

You should tell them immediately that they have to pay for their own college, seriously. The 15 year old especially might rethink the high school curriculum he or she chooses and how hard to work on it, and can start thinking now about what colleges to aim for.

To the OP: you said your plan was always to pay for two years of a state college (and do your kids know this?). Sounds like older son has not been in college since high school so you still “owe” him for it according to your plan? If you don't actually have the funds set aside specifically for your plan, time to sharpen the pencil to find them?

 

[Doribe]

Go "back" to school on your oldest? Did he drop out the first time or is this a second degree? I would not be very inclined to help with either. I like the idea of suprise gifts down the line if you want to help them pay loans down.

+1

 

[Bigdawg]

That may be good for some kids.... but it makes life more difficult that it needs to be if the parents have some means. In the case of those not getting their undergrad prior to 30, realistically they start out 8 years behind their peers in career development.

While I totally agree that kids should have skin the game with respect to post-secondary education, given how expensive it has become if parents have means to help its is good. IME, kids are still developing intellectually emotionally from 18 to 24 or so.

I don't know what the evidence shows but I don't know many folks who had it figured out from 18-22/24. I certainly did not. I would argue that my friends and acquaintences that didn't have it figured out and stumbled through the 18-24 years actually are doing better. They learned from their struggles. I do agree that we should help if able as I have with my kids. Conditions should apply. Benchmarks achieved, etc...

Because "IME, kids are still developing intellectually emotionally from 18 to 24 or so." I believe that they should not be given a funded green light to go off to a not well supervised 4 years of [-]drinking[/-], [-]chasing co-eds[/-],
study in whatever subject they think they may be interested in.

 

[flyingaway]

I'm basically FI. I'm doing OMY (or more) to build some buffer and help my sons in terms of possible inheritance. Although this is different from what you plan to do, the purpose is the same.
I'm 54, and my job is not stressful. But I still want to get out as soon as possible.

 

[LOL!]

I can see why the one son did not get much in the way of financial aid. Like many students, he has a job. He can probably work 20 hours a week somehow, somewhere while going to school. He can work full-time in the summers, but I do know that many students go to school in the summer, too, in order to get through college quicker.

Anyways, with tax breaks and part-time work, a student can come up with $10,000 to $15,000 a year on their own. I know the total annual cost of a Texas state university including tuition, fees, books, room & board is about $20,000 a year. With the Pell grant, that leaves very little money needed from loans.

Anyways, been there, done that.

 

[FI_RElater]

If 60k breaks your retirement plans... then you aren't prepared to retire in the first place. Drop [-]60k [/-] 100k from your assets and run firecalc again.

you need a healthy reserve for the expected unexpected- - - major car problems, new roof or HVAC, short term health issue (like hip or knee replacement, with associated co-pays and OOP costs including therapy) - - a good plan will include these and you will sail through without difficulties...a bad one, wellllll....

 

[pb4uski]

.... Because "IME, kids are still developing intellectually emotionally from 18 to 24 or so." I believe that they should not be given a funded green light to go off to a not well supervised 4 years of [-]drinking[/-], [-]chasing co-eds[/-],
study in whatever subject they think they may be interested in.

Totally agree... B's or better and I keep writing checks.... if not, then they front the cost for the next semester and I reimburse once I gat a B's or better report card and they can use that check for the next semester's costs.

 

[daylatedollarshort]

We retired early and funded college without paying too much out of pocket. We found many ways to reduce costs for college including community college credits, in state and public 4 years, co-op / intern programs, tax credits, financial aid, summer jobs, tutor jobs, online courses and transfer degrees from community college to the 4 years.

It is not just the annual tuition for college that matters but also the years it take to get through the degree. In California there are transfer degrees at the community college that guarantee students have a contract to graduate in two more years once they transfer to the four years. It looks good on a resume to not just have a degree but work experience and references for the first job hunt so the work during college was not a draw back but an big asset. And the transfer degree plans result in two degrees in 4 years (transfer AA and BS or BA).

We either bought or partially funded good value cars for both kids, too, so neither one is starting off adult life with any big debts.

 

[gauss]

Wife & I are planning to tell our cherubs - 10 & 15 - it's all them. Then when they are in late 20s give a large check. Idea being they will work harder / play less while in school.

Besides, if by college age they can't sort stuff in life to get by I've failed as a parent. Time for me (parent) & them (kids) to try a different approach.

From my 10,000 foot viewpoint what I see is you setting expectations.

Nothing wrong with that in my book. My parents always said that they weren't sure where my college money would be coming from -- but it was clear I would be going to college (I always did well academically).

The alternative, that was often pointed out to me on numerous cold winter days over time , was working at the car wash. I think DF hated the cold.

As it turned out, I was motivated asap to attain financial independence from my parents. I was able to do this via the engineering co-op program at my school and then supplementing my salaray savings with loans / pell grants etc.

My parents ended up supporting me for the first two years, then I managed to take things over for myself after that.

In my case, a little fear and uncertainty was a good source of motivation and went a long way. This was probably also a source of motivation for my desire to attain FIRE quickly.

For your kids, perhaps instead of telling them "it is all on them", consider giving them the "we are not sure how we can pay for this" line. That may leave the door open for assistance and not totally drive them away as others have suggested.

-gauss

 

[kcowan]

Bad idea. You and your health are more important than your kids not having student loans.

What was your original "deal"/understanding ith the kids?

If FIRECalc is 99%, then there is a good chance that you will end up with more money than some bad case scenario. If you retire and your sequence of returns early on is good you can always gift your kids money to help with their student loans.

Yes this is an ideal alternative. Just get on with your plans.

...I'd re-examine the retirement planned spending and see if prudent frugal cuts can make it possible to protect your health AND pay for 2 years of your son's college.

Yes some combination of this and the above should solve the problem. And don't forget to communicate with them about the alternatives.

 

[pb4uski]

.....The alternative, that was often pointed out to me on numerous cold winter days over time , was working at the car wash. ...

Funny that you should say that.

My dad had a side hustle that were two self-service car washes... one about a half mile from where we lived and another about 5 miles away in a neighboring town. My high school job was the car washes' jack-of-all-trades.... I checked the closer one before going school in the morning, the one further away after school and the one closer to home again on my way home at night. I not-so-fondly recall working with water in -30F Vermont winters. I did repairs and maintenance, collections, painting in the summer, ordering chemicals and parts, and anything else that needed to be done. I'm still a fairly decent mechanic/troubleshooter as a result of that experience which picqued my interest in business.

Had I not decided to go to college, those would have been my future.

 

[Music Lover]

$60k works out to $200/mo at 4%. As others suggest re run your numbers reduced by 60k. There should be several ways to account for $200/mo. Maybe a less stressful gig. At any rate it’s not worth sacrificing your well being.

From my perspective, it's 1000 times easier and far more preferable to spend a small amount of time to trim $200 a month from my monthly budget than it is to work for another year.

Realistically, I can trim $200 from my monthly budget in 10 minutes. And, I bet that most people on this site can also do the same in 10 minutes (or less).

 

[gauss]

Funny that you should say that.

My dad had a side hustle that were two self-service car washes... one about a half mile from where we lived and another about 5 miles away in a neighboring town. My high school job was the car washes' jack-of-all-trades.... ... I'm still a fairly decent mechanic/troubleshooter as a result of that experience which picqued my interest in business.

Had I not decided to go to college, those would have been my future.

Thanks for the insight.

I think the guys that my Dad was pointing out to me at the car wash were not the owners -- Dad had no side hustles.

-gauss

 

[aja8888]

It is not just the annual tuition for college that matters but also the years it take to get through the degree. In California there are transfer degrees at the community college that guarantee students have a contract to graduate in two more years once they transfer to the four years. It looks good on a resume to not just have a degree but work experience and references for the first job hunt so the work during college was not a draw back but an big asset. And the transfer degree plans result in two degrees in 4 years (transfer AA and BS or BA).

.

Most states I have been in have the same systems of credit transfer between CC's and universities. This is not anything new. My daughters did this 20 years ago.

 

[daylatedollarshort]

Most states I have been in have the same systems of credit transfer between CC's and universities. This is not anything new. My daughters did this 20 years ago.

I don't think anything in my list like financial aid, co-op programs or internships are new - just options we found helpful for reducing costs.

However, the transfer degrees are relatively new in California. We found them to be real money savers. It used to be very hard to graduate in four years from public schools here, especially transferring from the CCs. California legislated it by law under college admin resistance because the 4 years were not accepting the CC credits and it was taking students too long to transfer and graduate, if they did at all:

https://edsource.org/2013/new-law-increases-transfer-degrees-between-community-college-and-csu/40349

"Padilla’s urgency on this issue stems from the abysmal completion and transfer rates at the state’s community colleges, and what that means for the students and the economy. A 2010 study by the Institute for Higher Education Leadership and Policy at Sacramento State University, called Divided We Fail, found that six years after enrolling, 70 percent of “degree-seeking” community college students had not transferred to a university, nor had they completed a certificate or degree.

“For California to compete in the 21st century economy, we must dramatically improve the rate at which students transfer from community colleges and graduate from four-year universities,” Padilla said in the Oct. 10 statement."

Now there are transfer programs for the UC system, too, starting 2019, so that is pretty new here. So new it is in the future -

UC and CCC Sign Agreement to Boost Transfers
https://www.universityofcalifornia....boost-transfers-increase-academic-preparation

 

[ncbill]

Military's an option, especially for public schools.

Don't know if it would help for the one in college, but for the other kid, the OP could encourage them to pick a public school where joining that state's National Guard pays for tuition, while the OP picks up room/board/books/etc.

The above was the backup plan for our #2 kid (for an out-of-state public school) though they would have had to defer (need to be in the Guard for a year in some states to get that tuition benefit)

Or they could go active and use the GI Bill when they get out.

 

[Potstickers]

California's move is a good one. Colorado also has a good transfer program. Unfortunately, a significant percentage of community college students require remedial coursework (especially in math and writing) that definitely slows graduation timeframes and reduces overall graduation rates.

WRT the OP's question: I would recheck your retirement calculations and determine the impact of a $60K expenditure now. Are there other adjustments you would be willing to make? This doesn't seem like a tremendous amount relative to retirement assets you probably have if you have a 99% success number.

Unfortunately, the student who works and earns $20K/year will lose a lot of Pell grant eligibility. That may affect other institutional gift aid. Most students working more than 15 hours/week will also not be able to sustain a full (15/16 unit) course load required to graduate on-time.

As an independent student, your older student will be eligible for a larger loan amount -- $12,500/year if he has enough units to be considered a junior. Could you supply partial assistance that together with the Pell Grant, any institutional aid and some loans would cover the cost?

Health is worth a lot. In the calculus of life, I'd optimize for that. Good luck.

 

[Ian S]

He took some years off after high school, attempting to start a career. He didn't drop out.

You said that your plan has always been to help out with college. If you are helping the younger one currently in college, I think it would only be fair to help the older one who has probably matured while working in the real world and perhaps has a better chance of succeeding in college now than he would fresh out of high school.

That said, I don't think you should jeopardize your health by slaving more than you need in your job. Redo the calculations; as others have said, $60K to the kids over a couple of years doesn't appear enough to alter your ability to retire early IMHO. Can you belt tighten your retirement budget a bit to make it work?