Multiple kids and college funds

Sleepy425

DIS Veteran
Joined
Jan 11, 2011
If you are saving/have saved for college for multiple kids, how will/did you decide what to do with the money if not all of them go to college? Did you take from the account for the kid who didn't go and use it for a kid who did go? Wait until they were a certain age and then just give them the money (minus penalties for not using it for college)? Wait until you had a grand kid and put it in their name?
We have college accounts for all 4 of our kids. We put in the same amount for each kid every month. But our daughters also have over $30k/year (as of now, it goes up as the cost of our state school goes up) towards college because they were adopted through foster care. So if they do go to a not very expensive school, they won't need as much from their college fund. To be honest, we are hoping the kids choose trades and won't go the traditional college route, but want to be somewhat prepared financially just in case. I still have many years before we have to figure out what we will do, but I wanted to hear from others what they have done.
 
We have four children and two fosters. Any money saved for college went for college. If a child opted to not go, the money that was saved for that child's education was held for a period of time in case they changed their mind. After that it went toward the college education of another child.
 
No experience myself but can tell you about a friend. Her ex husband's grandfather had a large trust set up for his great grandkids for college. This trust covered all the kids' tuition, even their masters. There is one who didn't go to college. After everyone finished school the money left over was to be divided up among them.
 
My plan is to move any money not used by any of my 4 kids to an account for me. My retirement plan is to audit a grad school program (probably in something law related), and while seniors can go to classes cheap or free at my local university, I'd still need to buy books, materials, etc...

So, if there's nothing left, then I audit very slowly and as money allows...if there's tons, I told my spouse he can join me in my plans:).

PS - Now, my kids' accounts won't ever have more than 4 years of in-state tuition in each, so I'm not starting from a place where there's $250K+ or something in an account...if I was, I might have a different plan...
 


I have been saving for each of my kids since they were babies. The money will all go to education, including grad school. If they get scholarships, you can take out that money penalty free (though not tax free) if I recall correctly, though I would let the 529 $ ride. I would apply any one kids remainder after finishing all education to fund the education of siblings. I would plan on letting whatever remains, if any, after all of that continue to grow tax free to pay for the education of grandchildren. There's no reason to take a penalty, and now 529s can be used to pay for elementary and high school as well. Education won't be getting any cheaper, and while I would like my kids to get through college debt free, the burden that they will face to fund the education of their children will be that much worse.
 
We have four children and two fosters. Any money saved for college went for college. If a child opted to not go, the money that was saved for that child's education was held for a period of time in case they changed their mind. After that it went toward the college education of another child.
As of now, this is my intention. But, if they all go to college right after high school, I will have all 4 in at once. In that event, it's hard to save money for later if someone wants to delay. I'm glad I have quite a while before I need to come to any concrete answers.
BTW - it's nice to hear from other foster parents. In addition to our 4, we currently have 3 teenagers. In the fostering community people don't give our large family a second glance. In the real world people think we're nuts!
 
This is a good question. I have 5 kids and the 3rd is starting college this year. The two youngest are twins, age 15. So far, they've all taken different paths. Oldest went into the service and didn't use his, so it went to the next in line (who was my only other child at that time). She used it on some college and a lot of alternative ed programs. When the younger 3 came along several years later, we started college funds for them and it never occurred to me to consider what we'd do if they chose an alternate path. They have far more money in their funds than the older 2 thanks for multiple reasons but as of I now I can see that it's unlikely there will be anything left from DD's after she's done with her schooling so the twins won't get any from that. If one of them ends up not going to college, which doesn't look very likely right now, then I guess the money can be used for grad school or something else. I already have something set aside for my grandkids.
 


we've always been of the mindset that we would try to help our kids with education funding but we want them to have a financial stake in it as well so for full disclosure w/ my reply-our savings for our kid's education has never been intended to meet their full need.

that said-we look at it as just one part of our larger savings plan. it's earmarked for education so if one doesn't go while another does then there may be more to help with that one (and basic economics shows that apple to apples college wise-it will cost more for a subsequent one to attend) OR that just means our savings (for retirement or home improvements or whatever) will remain larger and we won't be actively looking for places to spend it b/c no one knows what the future holds except that as people age/join the fixed income retiree niche their personal expenses still increase with the cost of living (i guess you can tell that i'm in the camp that doesn't believe in paying for a kid's education at the cost of not funding one's own retirement).

now, if you are in the camp that feels the education money has been saved strictly for the kids and 'belongs' to the kids i think what a family member (by marriage) benefited from makes some sense. his grandfather had saved for each grand kid a set amount for education. if the kid went to college or trade school it was used to fund that, if not it stayed in the account and anything left over in an individual account at the point the 'kid' turned 30 was (using the right methodology to avoid taxation) gifted to that individual. as it happened all the grands were college bound BUT while his sibs simply used the funds to pay in full their educations my family member was thinking further down the line and ACTIVELY applied himself in high school such that he earned a full ride scholarship for his undergrad degree where he also applied himself so that he got hired into a job that essentially paid him to get his graduate degrees (multiple). while the sibs had zero in those accounts when they hit 30 he had the full amount plus the accrued interest resulting in a large amount that he chose to use for a down payment on a home.


btw-like you, i'm also a BIG fan of the trades. i look at what some tradespeople earn per hour and the financial investment it cost for their training vs. what their college grad peers invested/are earning-frequently the trades person is well ahead of the game.


BTW - it's nice to hear from other foster parents. In addition to our 4, we currently have 3 teenagers. In the fostering community people don't give our large family a second glance. In the real world people think we're nuts!


if you're a little nutty it's only by virtue of having to deal with all the social service's foster care staff and regulations and...:crazy::crazy: (i'm allowed to say that, part of my career was spent supervising a foster care unit-i have nothing but the highest regard for foster parents, thank you for being one:lovestruc:lovestruc).
 
I would keep the college money set aside until the youngest finishes school. If one of your kids decides to go to trade school instead of college, you may be able to use the money for trade school. I’ve heard that some of those trade programs are expensive. Anything left over I would roll down to the next child. Chances are you are going to need every last dime you have socked away and then some.

We did 529 prepaid tuition accounts for our 2 kids. Even with tuition and fees already covered for their in state universities and DS’s $20,000 scholarship, we have to shell out gobs of money every month to cover room, board, books and DS’s tuition differential for his finance degree (529 prepaid only covers base tuition, not tuition differentials for value added majors). Thank goodness both kids’ schools have payment plans.

Our in state universities cost $25,000 to $30,000 a year now when you include tuition, fees, room, board, books, and tuition differentials. It is crazy expensive!
 
We have one education account for both kids. DD started university in our city last year and all expenses will be paid (tuition and books) until she graduates. Same will happen with ds. I am not keeping track of how much was spent on which child as they are both free to choose the career path that suits them and it will be funded. Any money left over belongs to dh and I, not them to be used for trips, cars etc. Those are things they will work for if they want them. They have been told from a young age that, as parents, our goal is for them to graduate from university debt free so that they can start their working life unburdened with large loan re-payments.
 
Since 529 money can be used for ANY type of further educational expenses, we are just going to hold onto the accounts for both kids. We have 2 kids who are autistic and college is likely NOT in their futures. They are 12 and 14 now and each has about $30k in an account. We will keep contributing, but are pretty sure they will end up going to trade school or a certificate program of some kind (one wants to be a pastry chef). 529 money CAN be used for these also, so we will use it as needed. We also want them to have funds available should they decide to pursue higher education later in life, so we will simply keep the accounts active until SOMEONE uses them. Who knows, I may decide to go back to school at some point so it could be used by me too with a transfer. The penalties for withdrawing the money are pretty hefty so I would likely not do that unless there was some dire circumstance where we needed the money.
 
As of now, this is my intention. But, if they all go to college right after high school, I will have all 4 in at once. In that event, it's hard to save money for later if someone wants to delay. I'm glad I have quite a while before I need to come to any concrete answers.
BTW - it's nice to hear from other foster parents. In addition to our 4, we currently have 3 teenagers. In the fostering community people don't give our large family a second glance. In the real world people think we're nuts!

We had a pretty large gap - oldest is nine year older than the youngest. The two fosters (twins) are the same age as DD #2.

We didn't have the money saved in a 529, just a regular savings account for each child in DH and mine's name. DS #1 went to college and then went on to get his masters, DD #1 did a couple of years of community college, but never finished, DD #2 got her undergraduate and is pursuing her masters now, DS #2 did a year of community college and then went into the workforce. One of the fosters did a year of community college and then went into the workforce. The other foster got married pretty much right out of high school and had a child, but is now divorced and going to college on-line. We took the money that we saved for DD #1, and our fosters to help pay for the masters programs for DS #1 and DD #2. We are helping with some of the expenses of our foster that is now doing on-line school - - stuff that isn't covered by her scholarships/grants. DS #2 is talking about going to trade school and if he does, we still have his money as he hasn't "aged out" (we saved the money until they were 25).
 
Both of our boys had money given to them for college and a new car by their grandparents. Each started out with the same amount. We have told them that any money left over will be theirs when they are old enough to know how to manage it.

The oldest went to college and grad school for free. He will have a lot left over.

Youngest wants to go out of state where tuition + living expenses will cost $50,000 per year. He will end up with much less.

We think their choices should play a roll in the funds. We would never take part of son # 1’s left over money to fund son #2’s desire to attend a more expensive school.
 
We are saving for both children. If they go the traditional route they willl have two years overlap. If they provide a compelling case for a gap year, program I am open to it but besides that if they do not want to go to college/junior college/trade School the money will fund the other child’s college. I don’t anticipate being able to fund either one 100% (hoping to be able to have 25% of State school costs saved- more would be nice but 25% is realistic at this point). We will also help cash flow, probably work extra jobs, expect contributions from them and probably some loans. If they don’t want to go that money we have worked hard to save will sure come in handy for their sister.
 
Both of our boys had money given to them for college and a new car by their grandparents. Each started out with the same amount. We have told them that any money left over will be theirs when they are old enough to know how to manage it.

The oldest went to college and grad school for free. He will have a lot left over.

Youngest wants to go out of state where tuition + living expenses will cost $50,000 per year. He will end up with much less.

We think their choices should play a roll in the funds. We would never take part of son # 1’s left over money to fund son #2’s desire to attend a more expensive school.

In your case, I agree. The money was gifted by another party to your children equally. It would be wrong to take money from one child to give to the other.

In our case, DH and I saved our money to fund our children's college education. The money belonged to us. It was never gift to our children.
 
Providing a college education for our children is a big priority for us, so we started saving before the children were conceived -- yes, literally. We didn't have furniture in all our rooms, we had bedsheets instead of curtains, and we were on a strict grocery budget, but we put money aside for children we didn't know for sure would exist. I'm not sorry we did it this way: it's easier to scrimp and save when you're young and just being married and being together is an adventure in itself.

We did not save in separate accounts, nor did we earmark money for this child or that child. We just saved. The money was always in our names. Our kids had a few savings bonds, which were gifted to them by family members over the years. We used those in their first semester of college to provide a nice laptop.

When the time came, we set limits. Kids don't need the whole world of choices for college; sometimes more is just more, not necessarily better. We told them each that we could pay 4 years of tuition /fees, dorm /meal plan for an in-state school ... we also said we'd pay for their phones, health insurance -- and we'd provide them with a reliable car at the point they needed it (not when they're still doing on-campus classes, but when they were required regularly to do off-campus work junior or senior year). They'd be responsible for books, gas and any "upgrades" to our basic plan.

Our oldest had a hard time choosing between two schools that both "fit the bill" for what we could pay. She earned a nice fat 50% scholarship, so we were able to pay for her education without touching our savings. When she was a junior, we bought her a late-model used car. She understood we'd sacrificed to pay for her education, and she really appreciated it when she heard other people talking about taking out loans. She did her part and worked hard to graduate on time.

Our youngest opted to stay home and start at community college; she wasn't ready to go out into the big, bad world, and when she was given a nice scholarship that allowed her to attend tuition-free, that made her decision for her. When she finished her general degree requirements, she didn't really look around at universities -- she already loved the school her sister attended. She's still attending and is on track to graduate on time, but she also understands that we worked hard to provide this opportunity for her. Because we paid only a small amount for her first couple years, we are "ahead" financially with her, but we're paying sticker-price at the university. She's going to be gifted my current car, and I'll get a new one. Because my husband has retired, we will need to dip into our college savings for the first time to cover her college expenses.

In the end, paying for college has been considerably easier than we anticipated. Our oldest chose a major that's very scholarship-heavy, and our youngest chose a community college, where she was a big fish in a small pond. They worked hard to earn those scholarships, and they were exceedingly fortunate; as a high school teacher, I assure you that fewer and fewer students earn scholarships every year, and essentially no one gets a full ride anymore. We will have money left in the college fund when our youngest graduates, and that's our money. We covered their expenses and they'll each have a bachelor's degree and no debt -- we're almost done with what we set out to do. The extra money is going to turn into a camper and a pool.

If I were young and just married again, I'd do some things differently -- but I wouldn't change a thing about the way we approached college savings.
 
My dad who initially wanted to help all of his grandchildren with some of their college expenses has two who have not gone (both only did community college which wasn't very expensive) and they are now 22 and 23. Maybe one or both might go back, but probably not in the near future (you never know). Once those two started working, he has been giving each $5500 a year to fund Roth IRAs, so they have some in retirement savings (have an earlier start on that than they would without the financial contribution specifically for that). Also for the one of the two who was in a position to buy his first home, dad made a contribution to the down payment which meant no PMI. He also has been quite generous with the grandson with the house on some home improvements his grandson wanted to make (The grandson is very talented from as a do it yourself home improvement standpoint, (my dad is quite skilled on this type of thing too), and my dad helped fund a hurricane proof shed that will store lots of his grandson's tools and contributed toward a really cool do it yourself deck addition (really nice). My dad's thoughts are that he wants to eventually help both these grandchildren as much as the others who went to and graduated from college / grad school. But it's not like he just wants to hand them the money, but he does want to help out with certain things he supports that they might not be able to do very easily with just their own funds when he sees the opportunity and is gung ho about the idea. He doesn't want money, though, to have them doing things that aren't really appropriate for their life situations or fund a lifestyle that they really can't afford, so is careful about what he does to help them out.
 
My kids are 4 years apart. The money went into one account. The kids had no rights to the money when they were done with College. We paid 100% of their College expenses of the oldest from account, from our paychecks, and took out a couple of Parent loans. The final line of financing was the equity in our house, which was paid for 5 years before the oldest hit college, but we didn't have to tap into that.
Oldest went to a Private University and his tuition was many times the youngest's who went to a public university. Our house payment had been $1,100, and that money out of our paycheck every month was more than enough to cover the youngest's Public College costs so youngest ended up getting no money from the money set aside for college.
 
Trade schools are not cheap either so why shouldn’t that child get money as well? There are a lot of people who do better in life knowing a trade than with a college degree. Question regarding OPs post - Does your state pay for their college because they were adopted through foster care?
 
Trade schools are not cheap either so why shouldn’t that child get money as well? There are a lot of people who do better in life knowing a trade than with a college degree. Question regarding OPs post - Does your state pay for their college because they were adopted through foster care?
The post about trade schools was mine, and I'm the OP. I would still pay for trade school. But around here there are great high schools where you start your trade, so it is much more affordable to do. If either of the girls choose to pursue a trade, the money from the state would more than cover that expense, so their college funds wouldn't need to be touched.
Yes, the state pays up to what it costs to go to UConn because they were adopted through foster care. They need to complete their schooling by age 23 and maintain a certain GPA, and also prove that they have applied for other scholarships in order to qualify for that money. Also, because they were in foster care they get automatically get a certain amount after we will out the FAFSA (it isn't much because they were adopted young - kids who are in care after I believe age 15 qualify for more that way). We are thankful to know we have that money, because otherwise having 4 kids in college would be a much bigger burden.
 

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