Preparing for Your Children’s College Education While Saving for Early Retirement

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Saving for both early retirement and for your children’s college education is difficult. Each requires amassing a substantial amount of money in a relatively short period of time. For most people, those time periods for saving overlap. 

Saving money for college vs. retirementThis creates a challenge which may seem like an insurmountable obstacle. Many students and parents assume student loans are inevitable.

My wife and I are both first generation college graduates from middle to lower middle class families. We’ve each earned three college degrees with minimal student loan debt. 

Obtaining the skills to command a professional salary without the debt typically associated with those degrees was a complete game changer for us. We were able to get on the path to financial independence quickly, while many of our peers were drowning in debt. As a parent, this is an amazing gift to give your child if you can. 

I’ll share the framework my wife and I are using to enable our daughter to get off to a similar start. Our strategy is based on techniques we used to acquire our degrees combined with strategies of others featured in my book who have “hacked college.”

I’ll also share tactics that allowed us to confidently be done saving for our daughter’s education before I left my career when she was five years of age. 

Beyond Standard Advice

Typical financial advice around saving for college focuses on a few common themes. First is whether to prioritize saving for college or saving for your own retirement. 

Conventional wisdom says save for your own retirement first, then help your kids with college if possible. Those of us fortunate enough to be considering early retirement can likely do both. 

The question becomes whether to prioritize retiring as quickly as possible or slow our path to financial independence to save for both goals simultaneously. This is a personal decision. 

Our decision was to help our daughter. For others who have decided to help your kids with college, there are more questions. 

Is it better to save for college or cash flow expenses when the time comes? If saving, how much do you need to save? What accounts should you utilize? 

Those are important considerations. But there are more important things to consider first. I propose starting with a larger framework.

Building a Framework

This is a personal finance blog. It’s easy to focus on the finance aspects of our decisions and forget about the personal aspects. Planning for college gives parents a great opportunity to help launch our kids into the adult world and set them up for personal and financial success.

Determining the best way to help your child is one big piece of the personal aspect of this decision that is often overlooked. There are different schools of thought on this.

The Extremes

Some parents choose to pay for everything for their kids. Others feel it is not a choice, but a responsibility to do so. People in this camp often feel it is important to enable a student to focus exclusively on their studies while enjoying the “full college experience.” It is a privilege to attend college without having to worry about financial concerns. 

Others take a completely different approach. Even if it’s possible to pay for their kids college, they would argue that it is important for kids to figure things out for themselves. We all eventually need to become independent adults and learn to make decisions with real financial consequences. Gaining this experience early in life can be valuable.

Finding Middle Ground

Each of these approaches feels like a straw man argument. We feel the best approach is somewhere in between.

Even with school and work, it is possible to have the college experience. For a young student without family responsibilities, it’s an ideal time to learn time management. It won’t be any easier when they are older, have less energy and more responsibilities.

My wife worked full-time while going to school full-time, so we know it can be done and it has benefits. It taught her she was capable of more than most people assume is possible.

Her actions also provided a powerful talking point and resume builder which helped tremendously when marketing herself to future employers. She also developed real world experience and a professional network that gave her a leg up on other recent graduates.

However, it was stressful to the point of having negative health consequences. We want to help our daughter and not burden her with the choice of working that hard vs. starting out with crushing debt.

Thus, our philosophy is that the best approach for most students and parents is one of shared responsibility for paying for college.

Shared Responsibility

We plan to take a similar approach to what my parents took with my brother and I, sharing the responsibility of paying for college. This approach allows parents to provide financial assistance without fostering dependency. It also allows parents to assist in their students financial education by being actively involved in decisions and incentivizing the student’s behaviors.

Making the student have some skin in the game can encourage them to make better decisions as they see that their actions can have real financial consequences. At the same time, they don’t have to experience overwhelming responsibilities and crushing debt that can be the result of trying to pay the often astronomical costs that come with many college degrees without parental assistance.

Using this approach, it is important to understand the considerations and responsibilities of both parties in planning and preparing.

The Parent’s Role

Part of our role as parents is making good financial decisions so we’ll be in position to help pay for college. Having a comprehensive plan can reduce the financial burden on us, while also incentivizing behaviors in our children that will increase their likelihood of long term academic and financial success.

The cornerstone of our plan to save for college is to have enough to help our daughter substantially. However, we want to be careful to place limits on our help so there is no misconception that she has a blank check.

Incentivizing Behaviors

My parents saved as much as they could to help my brother and I with college. They didn’t have the option to save more without jeopardizing their own finances.

My parents showed me exactly how much money I had to work with. They then informed me that as long as I was spending the money responsibly, it was my money. If anything was left after finishing college, it was mine to help me get started in life. If I couldn’t get through school with what they provided, I’d have to take out loans and pay them back myself.

I’ve always been grateful for the financial help my parents provided. I’m even more grateful they didn’t sacrifice more in an effort to pay for everything.

Having skin in the game encouraged me to consider how I was spending their dollars. It motivated me to think outside the box to lower my education costs and living expenses. Learning to live within my means from a young age was as valuable as any formal education I received in college.

This approach has worked well with others I’ve talked with. Nothing is guaranteed, but I’m confident this provides the best balance of meaningful assistance without fostering dependence.

While my situation worked out well, it was in part a happy accident. My parents simply saved as much for my brother and I as they could with the income they had available.

We could have elected to keep working to save enough to pay full tuition, room and board for our daughter at any college if that was our priority. It was not. So we needed to decide how much was “enough.”

Saving “Enough”

We checked current tuition in Pennsylvania, where my wife and I went to school and lived when saving. Tuition in Pennsylvania is among the most expensive in the nation. Penn State University has the third highest in-state tuition for any flagship state university in the country, trailing only the University of Vermont and University of New Hampshire.

Future college tuition was not a primary factor in our relocation plans. However, we knew it would likely be a secondary benefit of our domestic geoarbitrage. The flagship university in our current home state, the University of Utah, has a tuition that is about half that of Pennsylvania’s ($9,498/year for U of U vs. $18,450/year for PSU).

We next looked at the current total cost of education. This is the sticker price that is typically referenced, including tuition, fees, books and room and board. 

According to, the current national average cost is $26,590/year for public colleges and $53,980/year for private colleges. Our experience showed us that with even a little bit of effort, you can pay much less than this price.

We didn’t do any future value calculations to determine what college would cost when our daughter will be that age. We simply used our gut instincts and came up with $100,000 as a target amount that felt right to provide meaningful assistance while requiring her to make thoughtful decisions and contributions.

Using the Rule of 72, we assumed that if we could accumulate $50,000 by age 6 and get a 6% return over the ensuing 12 years, we would be in the ballpark of this goal. We exceeded our savings goal by the time she was five years old, so we’ve stopped saving for college.

Using The Right Accounts

Once we determined how much was enough and figured out how to save that much, we needed to determine where to place the money. 

529 Plans

The most common consideration is a 529 Plan. These plans are broken into 529 College Savings Plans and 529 Prepaid Tuition Plans. 

For those unfamiliar with 529 plans, the link above provides an excellent overview of the different types of 529 plans, benefits of these plans, and links to individual state plans. Physician on FIRE provides an excellent overview of 529 plans from the perspective of an early retiree.

We elected to bypass using a 529 plan. The primary benefit of using a 529 plan is providing a tax shelter to save for qualified education expenses

The first tax benefit of 529 plans is a state income tax deduction on contributions. There is no federal tax deduction. Pennsylvania, where we lived when saving, has a flat state income tax rate of 3.07%. Making a contribution of $10,000 would have saved us $307 in state taxes.

Other tax benefits of 529 plans are state and federal tax-free investment growth and tax free distributions. These could be valuable. 

There are several downsides to using 529 accounts. The first is cost. Even the most highly rated 529 plans add additional fees. 

The other major downside of 529 accounts is restricting how the money is used. There is a 10% penalty to withdraw earnings from the account for anything other than qualified educational expenses.

ESA and UTMA Accounts

A Coverdell Education Savings Account (ESA) is another tax advantaged option for saving for education expenses. ESA accounts may offer some advantages for those who would consider using the money for elementary or secondary education expenses.

ESA accounts have two features that make them less attractive than 529 accounts. First, you can only contribute $2,000 per child per year. Thus this account didn’t match our goals of front loading our savings. Second, contributing to an ESA doesn’t provide a state income tax deduction.

Another option we briefly researched was an Uniform Transfer to Minors Act (UTMA) account. This provides another tax advantaged savings option. 

Once you transfer money into an UTMA, the asset belongs to the beneficiary. They get full control of the money at age 21, and you surrender the rights to control how the money is spent. This was a non-starter that outweighed any potential tax benefits for us.

You may have a different opinion and want to do further research on the benefits and downsides of these accounts. 

Taxable Accounts

We ultimately decided our best option was using a taxable account in our names. It will provide most of the tax advantages of a 529 account in our scenario, while maintaining control of the money and flexibility in how it is spent.

We planned to start transitioning to early retirement while our daughter was young. Our low income in early/semi-retirement years means we pay 0% long-term federal capital gains rates on most of our investment income for the majority of the years the money is invested.

Our low income also allows us to use tax gain harvesting to keep the cost basis high and capital gains low. Thus, we will pay little to no tax when taking the money out.

We also are able to avoid any penalty if we do not need to spend the money on qualified educational expenses. A taxable account also provides options with lower investing fees than even the most highly rated 529 plans.

A 529 may be a better option than a taxable account for those with greater tax benefits.

529 plans are also less risky if you have multiple children, if you have other relatives you may want to assist, or if those saving desire further formal education themselves. You can change the beneficiary of a 529 plan at any time without penalty. 

None of those conditions applied to us, making a taxable account preferable.

The Student’s Role

It benefits both parents and the students themselves to be part of the planning process. Having the student be an active participant in the process increases their accountability and incentivizes them to lower educational costs. 

My wife and I were both actively involved in planning and paying for our education. Still there was a lot that we didn’t know, so we could have done better.

This is an area I will continue to explore for my daughter. I plan to share on the blog as I uncover new options and as educational opportunities evolve. The following areas are where we anticipate focusing her efforts.


Working is the first thing that a student can do to earn some income to contribute to their tuition costs and/or living expenses. This provides multiple benefits.

The most obvious is the economic benefit. Even if a student is only working a part-time minimum wage job in a field unrelated to their studies, it allows them to make a financial contribution while developing their work ethic and time management skills.

Working while going to school can provide opportunities to build a professional network. This can set a student apart from other new graduates. A network can be extremely valuable to provide professional references and an inside track to higher level jobs.

Another benefit of working while going to school is learning how far your dollars go (or more accurately don’t go) towards something as expensive as a college education. Most students won’t be able to earn enough to pay for tuition and living expenses.

That’s not all bad. It can encourage the student to think outside the box. There are more useful ways to spend time to contribute to their education than trading time for money in low paying jobs that don’t provide multiple benefits.

Some examples that stack benefits are paid internships or low level jobs in their field that provide experience and income, resident assistant positions that provide free housing, or graduate assistant positions that offer free or reduced tuition in addition to any stipend.


My wife and I each benefitted from scholarships when going to college. She received a few small need and merit based scholarships applied toward her bachelor’s degree. I received one large niche scholarship that covered over half the cost of my master’s degree.

In retrospect, we could have done much better in this area. We will certainly coach our daughter to do so. In the Choose FI book, we devoted an entire chapter to the idea of “hacking college.” One of the people we profiled was Cody Berman.

Berman has put considerable thought into optimizing the process of obtaining scholarships. One of his recommendations is applying for many small scholarships which tend to have less competition and thus increase your odds of getting them. 

He also developed a system of “templifying” the application process. He found that most scholarship applications revolve around a few common themes, so he put considerable time and effort into writing strong essays around each theme. This allowed him to mass apply for many scholarships, spending only a few minutes on each to customize the template essays.

Getting Credits for Less

Another technique that Berman and others who have “hacked college” have utilized involve obtaining college credits at a reduced price. This can be accomplished in a variety of ways. They include taking A.P. classes and exams, CLEP exams, dual enrollment with high schools and local universities, and obtaining credits from junior college either while still in high school or between high school and enrollment at a traditional university.

Many of these options either weren’t available or we weren’t aware of them when my wife and I were going through school. They are a big part of our plan for lowering the sticker price of a college degree for our daughter.

I mentioned earlier that qualifying for lower tuition was not a big factor in where we would relocate. Almost everywhere outside of New England offers lower cost in-state options than Pennsylvania. 

These innovative opportunities to obtain college credits for less did play a big part in choosing our ultimate early retirement location. Other finalists were very small mountain towns with more limited educational opportunities.

Learning and Adapting

The final part of our plan will be a shared role between us and our daughter. If college costs continue to increase at a rate higher than wage growth or general inflation, we’ll continue to explore whether college makes sense. It will be interesting to see how the college landscape changes over the next decade before we have to make that decision.

College will likely always have a place in our society for professions like medicine, law, and engineering.  Other degrees are already becoming unnecessary or obsolete. Getting a degree in a field that doesn’t require particular credentials is becoming less attractive when skills can be obtained in non-traditional ways more quickly and at a lower cost. I’m excited to see what alternative educational options and opportunities exist in the future.

Having financial resources, flexibility and a curiosity to explore new opportunities as they present themselves give us confidence that we’re doing all that we can to give our daughter an opportunity to succeed without substantially sacrificing our own goals of achieving financial independence and retiring early.

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[Chris Mamula used principles of traditional retirement planning, combined with creative lifestyle design, to retire from a career as a physical therapist at age 41. After poor experiences with the financial industry early in his professional life, he educated himself on investing and tax planning. After achieving financial independence, Chris began writing about wealth building, DIY investing, financial planning, early retirement, and lifestyle design at Can I Retire Yet? He is also the primary author of the book Choose FI: Your Blueprint to Financial Independence. Chris also does financial planning with individuals and couples at Abundo Wealth, a low-cost, advice-only financial planning firm with the mission of making quality financial advice available to populations for whom it was previously inaccessible. Chris has been featured on MarketWatch, Morningstar, U.S. News & World Report, and Business Insider. He has spoken at events including the Bogleheads and the American Institute of Certified Public Accountants annual conferences. Blog inquiries can be sent to Financial planning inquiries can be sent to]

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  1. Great stuff! Always interesting to see how others in the FIRE are tackling college for their children. Do you keep the college savings in their own brokerage account for easy viewing or track it as part of bigger taxable brokerage account?

    1. Thanks Mark G. We keep it in a separate account. This makes it easy to see what we have for her there, keep it separate from accounts designated for our living expenses, and do tax planning so we can take anticipated large withdrawals in a tight time window without taking a big tax hit.

  2. Good stuff, Chris. We started out planning to fully fund a four-year education at the state flagship school (or anywhere with a pricetag equal to or lower). Now we’ve shifted our thinking and the kids will have skin in the game, including by being very active participants in hacking college. I agree with Mark G in that it’s great to see different — and often creative — ways to drive down college costs. This all said, I frequently bring up noncollege routes to the kids, such as trades and such, that could make ages 18-22 (and beyond) cheaper or highly profitable.

  3. My parents and grandparents paid for my college through a UGMA account, and I still have money left in there that’s now going towards FIRE. That gave me a lot of options when I was a new graduate, and I’m extremely grateful that they could help me graduate debt-free. I do wish they had involved me more in the process like you described so I could’ve had a better understanding of where the money was coming from, because it took awhile for me to really see how big that gift was.

    I opened a 529 for my stepdaughter when my husband and I got married. She was 6 at the time, so unfortunately we lost a lot of years of growth, but better something than nothing. We contributed what we could here and there for the first few years, and now that we we are receiving child support we use that money to fund the 529 to our state’s max tax deduction ($3400/year). We plan to help her financially while she’s in college in addition to the 529 funds, but if she goes to a traditional four-year school she’ll most likely have to take out some loans. So it goes.

    1. Liz,

      Sounds like you’re doing what most people ultimately do, which is make the best of the situation you have available. My only push back on your comment is resigning to the idea that loans are inevitable. It sounds like you have a solid foundation with savings. Don’t give up on any combo of scholarships, work, and getting credits at reduced cost.

      Best wishes!

  4. Chris,
    Thanks for sharing your $100k target for funding your child’s college education. We’re still trying to figure out the right amount and would be curious what other readers are targeting. I initially targeted about $120k (current dollars), which should be about enough to get through the flagship in-state program in 4 years where we live but since the market is doing so well, we’ve already exceeded this and we still have 3 years to go. We’re also providing incentives for our kid to strive for “top private out-of-state schools”. If he gets in, we will provide more funds provided we approve the school and major. We’re struggling with how much extra incentive to give for this scenario. I’ve been transparent with our kid on what he has and how it’s being invested and he’s seen how his 529 plan and UGMA has more than doubled due to index fund investing and the time-value-of-money.

    Like your parents, we are also following the: “as long as I was spending the money responsibly, it was my money. If anything was left after finishing college, it was mine to help me get started in life.” We encourage grad school so if our kid is frugal and/or gets a scholarship and/or finishes early due to AP courses, he can use any leftover money for grad school, backpack in Europe, put a down payment on a place to live, etc. That’s his call provided he finishes his undergraduate education.

    Other parents may have a different view or strategy for their kid(s) so I’m very interested in learning what other readers are planning.

    1. I always find it interesting to learn what others are doing as well. I really like the idea of hanging that carrot out there that the money is theirs to keep if they can find a way to get a degree for less. It worked very well for my brother and I.

    1. Agree. One thing that works against us with financial aid is having assets outside of retirement accounts, but if that’s your worst problem we have then life is pretty good!

  5. Hi Chris, thanks for sharing your thoughts on saving for college. We are near the end of the college cycle with our second child as he’s in his second semester of his junior year. We saved primarily in 529 accounts for each child but also saved in regular accounts as well. Our thoughts at the time were you never truly know if both your kids will actually attend college. The two types of accounts hedged our risk a bit with the taxes. We also were of the same mind that the kids had to have ‘skin in the game’ and were responsible for a small portion of the costs. Each was then able to offset some of their cost through scholarships and with my daughter, her becoming a Residential Advisor (which eliminated room and board for her senior year). Lastly, we were extremely lucky to be in a position to be able to cashflow about 25% of the cost each year. I found that its best to be extremely flexible to be able to adapt to the unique situation each child will present when its finally time to off to college. Again…thanks for sharing your approach.

    1. Thanks Mr. P2F. Agree 110% that it is great to have flexibility. Well worth the small tax advantages of 529 accounts or loss of control with UTMA for us.

  6. Tactics, planning, and effort are critical for this area. You have written a good overview of how to approach it. We came to the same conclusion on tax deferred education plans and just saved as much as we could in taxable form.

    We are finished with that game, but our experience might add to your article and maybe help others. We always figured on paying for a state school education, with the kids contributing through work, as possible. However, all of us thought a small college(almost all private and expensive) would provide a more supportive and much better place to learn how to think. We couldn’t afford it so told the kids: if they wanted that, they would have to pay the extra. We did a lot of research to find colleges that fit our kids, guided the kids in developing a resume that would work, and helped them though the decision process. They did the work to make it happen. Both got substantial academic scholarships, which made the actual cost of college much less than a state school.

    There are other routes, but planning, tactics, and effort work.

    One thing that most people do not realize: if you can find a private college that wants your kid, scholarships of various kinds are available that cut the cost to near or often below a state school. The trick is having a good resume that they will be interested in and finding the right school.

    1. Thanks for sharing your experience Connor. That’s awesome!

      Agree 110% that there are many ways to make college more affordable. The keys are to (1) not accept that the sticker price is the actual price that you have to pay and (2) be willing to get creative paying for college.

      I’m not saying student loans are always bad and that everyone can go to college w/o debt. Just that they should be viewed as a last resort rather than the first option.

    2. Our approach was similar to Connor’s. We avoided 529 plans feeling that they were too restrictive and plowed college money into low cost mutual funds. Both of our kids had average grades, and we told them that we could get them through without debt if they attended a community college for the first two years, then finished up their Bachelor’s at a state school. They would be responsible for trying to obtain scholarships and would have to take loans for any costs beyond those of a state school if they chose to go elsewhere. We figured it didn’t much matter where they took their basic courses, as long as they finished with a four year degree from a reputable college. Turned out to be a smart approach for our family. When he graduated from high school, our son (now 25) didn’t really want to continue on to college and only made it through his first two years. Our daughter (now 20), who had lobbied for an immediate move to a four year school so she could have “the college experience,” only made it through her first year of community college before deciding it wasn’t for her. Do my husband and I wish they had both attained their four year degrees? Absolutely. But both kids are gainfully employed at jobs they like and are making good money. Our son got his commercial driver’s license, drives for a major phone company and enjoys working outdoors with a small team of colleagues. Our daughter obtained her cosmetology license through a high school BOCES program and her Master Barber license after she dropped out of college. Although female barbers are in the minority, she is happy and quite content with her career choice. We’ve always told them to do what they love as long as whatever career they chose provided security and allowed them to be financially independent. The college savings path we followed worked out well for our family, but I understand that it would not have been the first choice for many. That’s what’s so great about personal finance – it’s “personal.” By the way, the leftover college funds have been placed in a fund earmarked for . . . Weddings.

      1. Mary,

        You make another great point that factored into our decision to choose the flexibility of a taxable account over locking ourselves into a 529 plan. Like your kids, my wife’s brother also has a CDL, but not before having the idea of college as “the” path to becoming a successful adult shoved down his throat by family and school. He is incredibly smart and he does very well financially, but I think he still struggles with the idea that he is not a “success” as he is the only one of four siblings not to have taken the college path. At seven, our daughter seems to be a kid that will excel academically, but it is still early and we want to make sure that she knows there are many paths to a successful life. If she wants to go to college great. If not, the money can be used in other ways to help her get started in life.

        Thanks as always for sharing your insights!


        1. So, out of curiosity, I checked to see what happens to funds in a 529 plan if your child doesn’t go to college. According to a 2017 article by Carrie Schwab-Pomeranz on the Charles Schwab web site, there are a few options. The funds can be used toward any eligible institution of higher education, including trade or vocational schools; you may change the beneficiary, as long as the new beneficiary is a family member (and that can mean not just another child, but a sibling, grandparent, cousin or even yourself); or you can cash out the plan and pay both federal income tax plus a 10% penalty on earnings. Interestingly, the article noted that the penalty is waived if the beneficiary received a full ride scholarship. All good to know.

          1. Yes. Some people have written that they could use the money to study abroad in retirement and even pay room and board in a tax advantaged way. Lots of potential creative uses.

            For us, it just didn’t seem worth the risk and hassle. But as noted, I can definitely see where a 529 would be a better choice for many people.

  7. You lost me at the saving 50k at age 6. Not many people have that wherewithall to save that. Up until then, I liked the philosophy of sharing the burden with the child, but not overburdening. We struggle with this tough choice. One kid got thru with 24k in debt while we paid 100k. The other is hopefully looking at less. Your overview is helpful – all kids should read it. Parents who are paying attention know all this. Rich folks won’t care, but middle class one will certainly relate to these tough choices.

    1. Joseph,

      Thanks for the kind words.

      I acknowledge that replicating exactly what we did may be tough for many people, particularly those saving for multiple children. However, it is probably not as hard as you may imagine.

      To add a little color, here is how we did it. My parents gave us $5k when my daughter was born and we matched it and invested it all immediately, so she had $10k by the time she was a month old. Outside of that, we didn’t get any other help saving, and we didn’t slow down our saving for retirement. I picked up a side hustle teaching an intro rock climbing course at a local university paying about $5k/year. I also started earning a couple hundred dollars/year from freelance writing. Neither are life changing amounts of money and this is very replicable by others who can make money in fun and interesting ways. The money added up quickly ($40k+ in contributions + a tailwind from a bull market) and we exceeded our goals.

  8. Not everyone likes to research things but I do. I asked parents who had children a few years older than ours what they were doing to select a college and the answers sent me checking things out. I also read the colleges’ websites as it related to scholarships and learned some colleges only give help the first year and then it switches to loans. My assumption is that the college figures the student will not want to switch schools thereafter. I also read on the websites the financial situation of the school. Some have huge endowments and fund a certain number of students partially every year for need and some for academics. Where both of my kids went was a smaller Christian college in PA and the school assured us that if we were eligible for financial aid because of need the student would receive it every year, not just the first year which happened to my niece at a different college. The college we chose was a fiscally conservative school which upgraded their facilities when they had raised the money do do so. That was another plus in my mind because they would not be raising tuition so rapidly to pay off the school’s building loans, they already had the funds. The other college we were considering was in the process of a large building expansion seemingly in every department. Their tuition and fees were much higher and only one student in each entering class received a full ride scholarship. In 2012 and 2013 both of my kids received their BA degrees. Both worked between 1 and 2 years part time (resident assistant, security monitor, dish room) on campus and also had to earn $2k or so for the summer toward their tuition. With our savings of less than $20,000, the college scholarships and our putting $6,000 for each of their expenses every year the rest was covered for both of our kids. We found the private school cost at this college almost identical to the NY SUNY cost for tuition, room and board. Better yet, they both made lifelong friends and now live near their best college friends in Raleigh and Boston where there are a lot of good jobs. I agree there are a lot of ways to make it work for your kids and having them involved is key. I think the only change I would have made is having our son think about taking a gap year and investigate careers and work that year to gain more maturity and experience.

    1. Wow Lee! Great comment with lots of ideas to chew on. Thanks for taking the time to share your experience and insights.


  9. Research, research, research. Its key if you don’t want to get scalped by college. There are a huge number of hidden hookers in selecting a college and the admission offices are not your friends. Lee did right!

    To add to the “non college” path, All my family for several generations has gone to college. There wasn’t any other “path”. I got an advanced degree, went to work and achieved a fairly high level before it got extremely unpleasant. Quit/got fired at 39 and started working with my hands. You know, get dirty, blue collar kind of work, anathema in my family. But, it lead quickly to my own business. Did that for 30 years, loved it, and made a fine living. College isn’t the only path. The financial trick to that approach is “own the business”.

  10. Our oldest has graduated and our youngest has just started college. We saved in aggregate but never specifically for college for our two children — 1) b/c we agree with that conventional wisdom to prioritize your own retirement first; and 2) b/c we felt that the college market would change considerably by the time our kids went. In the 90’s when we had our first kid, college was rising at twice the level of wages. It’s actually still doing that but I thought things would change. I also thought there would have been more innovation and a decrease of costs in education. I still think these things may happen for kids who are toddlers/ elementary school today. So saving based on today’s college costs may not make sense.
    In our case, even though we didn’t save for college specifically, it still worked out. Our oldest got a full-tuition scholarship in our city so ended up living at home. Her college costs were almost nothing. Our youngest is actually much more expensive than we expected b/c she’s doing the opposite — far away and private with far less covered by scholarship money. Still, it’s a cash flow issue to help her with the costs, and the general savings we did earlier on may or may not be used.
    If I could do it all over again, I would earmark specific real estate for each kid and pay the college costs from the rental income. We got into rental real estate too late to do that but I do see our rentals helping us cover at least some of what we plan to contribute for our youngest, and certainly the real estate will provide a legacy for our kids, grandkids, etc in years to come.

    1. Thanks for sharing your experience and insight Caroline. I love the idea of using real estate for this purpose. I heard Scott Trench of Bigger Pockets talk about this a few years ago and it’s been in the back of my mind since. You may have just moved it to front of mind. 🙂

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