Wednesday, March 03, 2010
Not Ready for College, But Getting There
Of the many things I am thankful to my parents for, their immigrant mindset of doing what they could to pay for college for me and my sister is way up there. Now that I have kids, I realize just how costly a commitment it is, especially with Penn recently announcing its annual "tuition plus room and board" amount is now over $50K. I recently punched in our current education savings, some return and inflation assumptions, and Jada and Aaron's ages, and was told I need to save about $15K a year for the next 15 years. Ouch! And we consider ourselves on the more diligent side, in terms of having socked away some serious change so far into their education accounts.
Although college savings is a pretty rare conversation among the other parents of young kids I circulate with, when it does come up, the responses are usually on the order of "scholarship or bust," or "they'll have to settle for less pricey options," or "student loans, here we come!" In fact, there's nothing wrong with less pricey options, and student loans are about the best debt you can take on; but a big part of me, influenced by my parents, also says, "well, if saving $15K a year for the next 15 years is what it's going to take, then let's do whatever it takes to do that." I know my parents sacrificed so I could get my Penn education, and I know I want to do what I can to make that possible for my kids, too. And if it takes socking some serious change away so that, when it comes time for them to make that big decision, they are not constrained in their choices by our unwillingness to prepare and be frugal, well then that's what we'll try to do.
All that said, I'd really like for the stock market to go on an extended bull run, and/or have college tuition not grow at twice the rate of inflation. Or, Aaron can get an athletic scholarship followed by a multi-million dollar contract. I'm not holding my breath on any of those transpiring, so big checks to education savings, here we're going to have to come.