Conference quark::mennotes

I think you might find a lot more discussion in the INVESTING conference
(and/or COLLEGE).

I agree with those who say to not put lots of money in your kids' names.  The
reason for this is that the colleges will consider just about all of that
money available for college, whereas they'll consider a smaller portion of
the parents' assets.

If you want to maximize your potential for loans and grants, the system,
unfortunately, encourages parents to "bulk up" on debt - refinance that house,
buy a new car, owe LOTS of money.  Don't pay off the mortgage early - you'll
just be forced to remortgage.

On the other hand, if you are looking 10-15 years out, put money away
regularly in a stock mutual fund - often recommended are index funds that
track the S&P 500 (such as Vanguard Index 500).  If you use an index fund,
it will tend to generate little in the way of taxable distribution along
the way (which may or may not be a good idea from your perspective.)

				Steve

Oh, and to add a perspective relevant to this file, many courts have held that
divorced parents are obligated to pay for a child's college education, even
though there is no such requirement for married parents. You may not get a
choice of which college the kid attends - if he wants Harvard, you have to
cough up.  If you have remarried, your spouse's income and assets are also
included in the formula.

				Steve

    I'm interested in more info on why not accounts in kid's names.  I 
    don't have kids, but my brother and his wife opened accounts for their
    two kids the minute they were born.  My parents and I each find some
    excuse to put money in there occasionally towards their education.  It
    makes a nice addition to Christmas or birthday gifts to enclose a check
    towards their college fund.
    
    Karen.

    
    >    I'm interested in more info on why not accounts in kid's names.  I 

    When you fill out the Financial Aid Forms (FAF), they use a formula to
    determine how much money should be "available" form the parent and
    the child for their "contribution" the the child's education.  A
    much higher percentage of the money that is in the child's name is
    considered "available".

    I found out too that if I had spent all my money, gone into debt up
    to my eyeballs for house, new car, etc I would have qualified for
    more financial aid for my kids than I do by trying to save my money.
    Too late.

    Check out the book 'THE NEW COLLEGE FINANCIAL AID SYSTEM' by David
    Jaffe, Council Oak Books, ISBN 0-933031-82-3.
    
    fred();
    

    The other reason is that you can't control what happens to the kids'
    account.  When they turn 18, it's up to them to decide how to spend it.
    What if the kid doesn't go to college at all?
    
    It's better to keep the bulk of the money in an adult's name for better
    control (and less impact on financial aid applications.)  
    
    				Steve

    .2 Many courts have held accountable the NCP male. One man had for his
    only daughter $60,000.00. Which was in the mothers/CP name. And was
    spent before she was of college age. The state of New Hampshire and its
    beloved DCYS tryed to snooker him to pay, AGAIN, college tuition. He
    was bankrupt, lost his business in the divorce, sold off his machines,
    and was working at Tri-Angle Pacific. There was no way he could foot
    the kind of college he had set his daughter up with now. 
    
    Lucky, he was able to prove that DCYS was over the bounds in what the
    could and could not do. And was able to prove that the $60,000 was
    spent by the ex in a very high life style for a few years. Now his
    daughter, like many of us have, will have to work her way thru college.
    
    Insofar as .0 goes. Its best to talk to a finacial adviser. Someone who
    can help you plan it out, as well as a good CPA. And stick to your
    budget. I also know of a woman whose mom and dad went without and put
    up the money in stocks and bonds. And because of this, she could not
    get into some colleges because her parents made too much, and she could
    not get fincial aid to these colleges although there was a health stash
    of cash. But, this was not enough to carry her thru college. She was a
    former tenant of mine.
    
    

    Another big sore spot in financial aid is that if you pay child
    support, there is no way to deduct that on the Financial Aid Form
    (FAF), but if you receive child support, you must declare it as 
    income.

    fred();

    I don't think it's a bad idea to ask your kids to take out student
    loans and/or get work-study programs, to help pay for their own
    education. This will make them appreciate it more, think carefully
    about what kind of degree they want to pursue, and get the good
    feelings of accomplishment that come from doing something for yourself.
    I'm not saying you shouldn't help them--either now or by helping to
    repay the loans. i'm just saying, why should all the burden be on your
    shoulders? Your life counts for something too. Of course, I speak from
    a very personal perspective. I put myself through BU night school for a
    computer science degree, while I was a single parent (getting no child
    support, I might add, and working as a cleaning lady to support myself
    and my daughter) and graduated at age 31. I still owe about
    $10,000 in student loans. My daughter decided to go to Clark
    University, NOT a cheap school, four years ago. I told her at the time
    that I would help her however much I was able, but that she would have
    to take the primary responsibility for paying for her education.
    She is about to graduate this May. She's worked very hard and will be
    graduating with honors. She will owe about $23,000 in loans. I'm torn
    at times as to whether I should concentrate on repaying my own loan, or
    help her first. I'm finally starting to make decent money. But after
    being poor basically my whole adult life, I don't want to feel that,
    OK, I finally worked my own way out of debt, now I have to spend the
    rest of my life paying off my daughter's debts. I also married a man
    who has a lot of debt, and a job that doesn't pay well. I married for
    love, not money! It's a tricky balancing act. 
    I know that when I  start thinking that I'm just a
    machine whose purpose in life is to make money to throw into a
    bottomless pit, I get a little ornery! Anyway, this issue is a whole
    other note, I guess.
    
    I will say that my daughter has told me a number of times that she's
    very proud of herself for accomplishing this pretty much on her own.
    She has a very down-to-earth, adult attitude, unlike some of the kids
    who got everything handed to them. This feeling of self-reliance will
    be a big asset in her adult life.
    
    Hope this perspective helps.
    
    Anne
    

Hello,

   how about a child that never asks, or asks like this "I picked the colledge"
"There is an event this saturday"  I got tired of asking, "well?"

   Should a step-dad pay for step childrens college even if the child
does not ask for it?

   Some history.  She doesn't want to work.  Doesn't want to go
in the military because she would have to clean her bed.  Wants a car. 
has picked her college in OK, even though we live in CA.  Poor grades
allowed the CA schools to say she is not atadmitted.

I just invested 4000.00 to save 200000 on the house loan.

college is 40000 for four years, what is the return on my investment?

and yes, I need a attitude adjustment.

We have 10 rules in the house, she has broken 8 of them.  We have had the
house for 3 years.  I have been married for three years.

Andrew

    If grades are poor, and money is tight, try a two year college to get
    her some sort of bread and butter degree vs a lovely degree that is
    wonderful and nice.... but doesn't make her a living that would allow
    her to find that financial independence.
    
    Sould a step dad pay? Gee. Mine helped. I didn't free load, I worked
    pumping gas, flipping burgers, and framing houses, and got some help
    from the folks. It wasn't easy.:)
    
    

    
    My opinion is that you are not obligated to pay.  I told my kids, "If
    I pay, then you are going to a school I can afford".    If you do feel
    like contributing, if it were me, and with the poor grades, I'd offer to 
    help out with the first two year at a junior college, then base my 
    further contribution on her performance (read grades, etc) in the
    juco. 

    Truth be told, this is a better strategy with the large universities
    anyway.  The first two years of the big universities are designed to
    "weed out" "no-performing" students.  A juco is designed for you to
    succeed the first two years.  Many students end up wasting a lot of
    tuition $$ to go the the big school, flunk out, then got to a smaller
    college or a juco for a year or two at least before returning to the
    big university.

    fred();

     

    What's wrong with saying how much you will give towards college,
    say a state university rate, and that if they want to take on
    after college debt, that that's their choice?  It makes it a
    shared responsibility and is good training for life.

    justme....jacqui

    p.s.  Worked well with both my kids...college grads '86 and '89!!
    	  Both have own homes and jobs.

Nothing wrong with it, but the courts have their own rules for divorced
parents.

				Steve

    It becomes out of control when neither parent have a college education,
    and now DOR/DCYS become instrumental in making it happen. What of both
    parents putting it away. It always seems the walking wallet has to foot
    a bill that can be abused. 
    
    I have a co-worker who is footing the bill
    for his daughters college ed. And the ex is also using it to fund her
    education. They take turns going to college one on, one off term.
    Sounds real fair... but they are able to slip it to the system, and
    again take advantage of the walking wallets.
    
    It will be me who will foot the bill for my daughters education, as my
    ex will take her vacations, have a dam good time, and I will do working
    vacations, stock money away. And pray that our daughters grades are
    good enough for scolarships and such.
    
    Then again, women need men like fish need bicycles.....
    
    

re: .12

   > What's wrong with saying how much you will give towards college,
   > say a state university rate
   > ...

Sounds good.  She finally got a job a couple of weeks ago.  I think
it finally dawned on her that I meant it when I said 
"If you don't get a job, then no driver training.  It costs 1000.00 out
here in California"

She waited two years expecting me to buy a car, pay her insurance and
give her driver training all the while I said get a job or walk.

I still think she thinks everything is magic and the college money will
just drop from the sky and be taken care of.

oh well.

we have concidered having me give her a loan for the money, since I
am just the step-dad.

Andrew

PS.  Yes I know I should not just ramble, but it has been 95 out here
for the last couple of days, so it is hard to get to sleep.

AJ

    AAah!! Pennies from heaven. Money grows on trees, the streets are paved
    with gold and a man giving out gold bricks on the corner so you don't
    get any idea of digging em up.... 
    
    My ex, was making more than me before we had our daughter. I would have
    to work overtime to exceed her weekly pay. And afterwards, when she
    went back to work. She wanted to become under employed. Hey. Just keep
    workin over time...