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The No-Nonsense Parent’s Guide to Saving for College

by Shawanda Greene

University BuildingGiven the shameful condition of the average American’s finances, it’s a wonder so many insist on funding their kids’ college education.

Albeit a noble endeavor, setting aside money for your child’s education, while your retirement portfolio lay coughing and wheezing on life support, is another form of living above your means.

I say let the kids fend for themselves. You need to focus on how you’re going to comfortably retire when Social Security benefits are drastically cut. In February 2011, a retired worker’s average Social Security check was a paltry $1,178.

We both know it’s all downhill from here.

“But, Shawanda, what about the children? Tuition is so expensive. I can’t have my kids saddled with burdensome student loan debt. They won’t be able to make a decent…”

Shh. Save it.

I don’t care about your kids. They don’t read my blog.

Now, I can’t speak with any authority as a parent. However, I am the daughter of a mother who saved a grand total of $5,000 for her child’s post-secondary education. I’ve done all right for myself – even with my mother’s college savings plan consisting almost exclusively of the sage advice, “Leave it in the hands of the Lord, and He’ll work it out.”

Really, mama? *tilts head to the right* Really?

Well, you should be a bit more sophisticated than that. If you feel some innate obligation to pay for at least some of your child’s education, then here are a few tips on how you should approach the process.

Save as little as possible

Don’t you waste another nanosecond worrying about how you’re going to pay for private school tuition. You’re not. You’re going to find out how much cash is required for two years of community college plus the cost of two years’ attendance at the average in-state university. Work on saving that and, let junior figure out the rest.

Make your child help pay for their education

They don’t get to lounge around while you scrimp, save, and sacrifice to put their butts thru college. Summer vacation? Never heard of it. Your child should spend the equivalent of a part-time job, i.e., 20 hours a week researching and applying for scholarships. If not, their full-time summer job will help pay college attendance costs once they leave the rent-free, eat free, and otherwise, bill-free comforts of your home.

Be honest

A 4-year university isn’t for everyone. There’s no doubt education is important, but it can come from anywhere. Vocational and trade schools – which may be more suitable based on your child’s academic experience, skills, and interest - are too often overlooked. If your child was a mediocre student in high school, that’s not likely to change when they get to college. You can send your kid to college if it makes you feel better, but, remember, it ain’t free.

Never cosign a student loan

Should your child default on a student loan, you’re on the hook for it. Regardless of whose education it paid for, student loan debt – public AND private – is almost never discharged in bankruptcy. And don’t take out any other debt to pay for college either. You’re old. Your child has far more working years left in him to pay off debt than you do.

If you’re rich, never mind me. Go crazy paying insane amounts of money for your child’s college education. Heck, don’t even bother calculating the return on your investment. If you’re average, I really do think it’s great that you’re even considering financially supporting your son or daughter beyond childhood. Just make sure that particular goal is towards the bottom of your list of things to do.

 

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{ 8 comments… read them below or add one }

Adria March 16, 2011 at 11:23 PM

This is exactly what I am doing with my son. He did start out at a 4 year college but soon saw that going to a community college was more economical. He wanted me to co-sign for a student loan but I refused and I am so glad I did. Thanks for the great advice and keep up the good work.

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Shawanda March 20, 2011 at 10:49 AM

That was smart. I remember my brother tried to get my mom to get a parent loan for him. She refused because she felt like he wasn't serious by college. After all, he wasn't serious about high school. Looking back, I'm pretty confident my mom would've been stuck paying for an unfinished degree.

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FabulouslyBroke.com March 17, 2011 at 8:23 AM

Exactly what I am doing with my future kids. Retirement first, their education second and they are DEFINITELY going to help pay for it.

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Ruth March 17, 2011 at 10:03 AM

I totally agree with this. My parents did this for us (made us pay for our own way through P/T jobs and student loans). Now that they're retired, I feel at ease that they're not in debt because of us and asking their kids for money…because they have their own.

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Shawanda March 20, 2011 at 10:55 AM

Parents should look out for themselves first. Many don't, and they end up burdening the very children they were supposed to help.

Although I thought my mother was a bit irresponsible due to her approach towards college savings, I don't blame her. Somehow, my education is totally paid for.

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kbt May 13, 2011 at 3:39 PM

I think I'm really lucky with my college education and one of the few kids who have very little debt out of college. My parents scraped, saved and invested so all (3 of us total went to UMCP for undergrad) had our college tuition paid for via credit cards in full. We were not allowed to take private bank loans; the only loans we accepted were Stafford subsidized loans that did not charge interest while you were in school.

I left school with about ~$5000 owed in my name. I should mentioned that all of us lived on campus for 1 out of the 4 years and that my parents are not "rich" or have high-paying jobs in any sense. They just knew how to save.

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Mark Anthony Morales September 2, 2011 at 1:43 PM

Being the first to graduate high school of my family no one knew just how expensive furthering my education would be!

When I turned 18 I asked my mom if I would be receiving my trust fund….. of course I didn't have a trust fund.

I then asked my mom how much I would get from her life insurance if something "mysteriously" happened haha she just said not enough.

Right now I'm paying college through grants and scholarships but oh how I wish my parents had saved even just a little bit for my college.

Too bad they never read this!

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Michael Deemer February 15, 2016 at 7:30 PM

You must participate in a contest for the most effective blogs on the web. I’ll suggest this site!

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