How are your kids going to go to college? - Page 11

[Mulvah]

Originally Posted by CatsCradle 

Sorry, I'm smack dab in the middle of a raging flu and should be in bed, but this post caught my eye and I feel compelled to insert my personal experience.  Parents certainly have all the rights to financially plan according to how they see fit, but this particular post reminds me of the importance of setting up a trust for DD as opposed to "it will be yours when you're 18" type of situation.  Anna Bees, you mentioned in a previous post that your child's gift money, etc. goes into the savings account.  I'm just curious why you believe it is yours?  I mean, I can see you acting as trustee of her funds until 18, but just can't wrap my head around why it is your money until she is of legal age?

The reason this bristles me is that my grandparents put a considerable amount of money in the bank for me when I was a minor.  My bio-mom, Dad's ex-wife, fell in love with another man and used the money in my account to fund her wants, needs and desires.  She was able to do this because she was named a custodian on the account.  I don't mean to be all negative and stuff, but setting up a trust allows a legal recourse if one parent or custodian should hit the road with the cash.  Once I bequeath money to DD, it is hers.  When she receives gifts, it is hers.  Funny story, but DH and I were completely out of cash this past Sunday and we asked DD if we could borrow $10 until we went to the bank.  She obliged and we handed her an IOU.  We paid her back.  My parents actually borrowed money from me when I was a teen (I had a sizable account from working, saving, gifts, etc.).  They needed some additional cash for a down payment on the house and I agreed to help fund that.  We entered into an agreement and all went well.  Sounds weird but that's why I think it is important to differentiate between parental money and child money.  Just my opinion.
 

I completely agree. 

If I were in that scenario, as the child, I would cash my own paychecks and keep the cash hidden in a shoebox until I was old enough to have my own bank account.  I would also pay for every single thing on my own from the time I had a job.  Those strings are not worth it.

[AnnaBees Mama]

Thanks for the feedback everyone. We are scrapping the plan, because it is obvious it was heading us in a direction we did not want to go. We definitely want the money given to her from other people, and earned by her, to remain HERS, period, no strings attached. We NEVER intended on our set up to be a carrot-dangling scenario (I'm having all sorts of terrible flashbacks from the drama tv shows...), but we could see how the arrangement could bite us all in the butts, relationally and legally. (ETA: we would also never compel our children to give *us* part of *their* money to put in an account under *our* name. We were thinking we would strongly encourage her to put a percentage in this account since it was intended for her use later on----  but with that account being in our name---- even though WE know us well enough to know we would never touch it, nobody else would. And that's dangerous and super shady.)

I'm not quite sure where to go from here, though. It's obvious we need to keep the money her dad and I save separate from the money she is given from others. I suppose, stick the gifted money in the custodial account until she arrives at an age where she is aware of money and desires to manage it (she's now 16 months)? 

[captain optimism]

Oh, good, I'm glad you saw the difference between the custodial account and the grant funding scenario. 

I think the idea of two accounts is a good one. You might get a better deal on the taxes on an UTMA or custodial account than on a regular old savings account or CD, but you're paying for the right to both say no to things you don't want to fund, and yes to surprising your daughter when she wants something she can't afford, like a Master's degree. 

Originally Posted by AnnaBees Mama 

Thanks for the feedback everyone. We are scrapping the plan, because it is obvious it was heading us in a direction we did not want to go. We definitely want the money given to her from other people, and earned by her, to remain HERS, period, no strings attached. We NEVER intended on our set up to be a carrot-dangling scenario (I'm having all sorts of terrible flashbacks from the drama tv shows...), but we could see how the arrangement could bite us all in the butts, relationally and legally. (ETA: we would also never compel our children to give *us* part of *their* money to put in an account under *our* name. We were thinking we would strongly encourage her to put a percentage in this account since it was intended for her use later on----  but with that account being in our name---- even though WE know us well enough to know we would never touch it, nobody else would. And that's dangerous and super shady.)

I'm not quite sure where to go from here, though. It's obvious we need to keep the money her dad and I save separate from the money she is given from others. I suppose, stick the gifted money in the custodial account until she arrives at an age where she is aware of money and desires to manage it (she's now 16 months)? 

[Linda on the move]

Originally Posted by Imakcerka 

YAY... a post that solidifies my lack of hope...
 

Have you seen the book "Debt Free U"?

Our library has a copy and I've seen it in bookstores as well. It's a good read. It has a lot of information in it and makes a solid case for going to community college for the first two years.

I highly recommend reading it for any parent who is concerned about this topic.

We are closer to this stage of life than most on the board (my kids are in 8th and 9th grades) and the whole thing looks different to me than it did when they were little. It may look different again in a couple of years.

One of our DDs will most likely get some very nice scholarships. May be not a full ride, but something helpful. Our other DD will be expensive to get through school -- she is most likely not scholarship material, may need to take a light load (she is both gifted and has special needs,) and might not be able to work much, if at all, while attending college. Getting her an appropriate education is challenging. We are going to do what both of our kids need to reach their potential. Our kids aren't going to need the same things from us.

[TiredX2]

Originally Posted by AnnaBees Mama 


I'm sensing snark. I'm not sure why your tone is as such, maybe I am misreading it since it is hard to detect tone in writing sometimes.

I'm just going to let this go.  If I expressed snark, I think the reasons have already been gone over by others.  I was actually attempting to avoid snark, though.


 

Originally Posted by AnnaBees Mama 

I'm not quite sure where to go from here, though. It's obvious we need to keep the money her dad and I save separate from the money she is given from others. I suppose, stick the gifted money in the custodial account until she arrives at an age where she is aware of money and desires to manage it (she's now 16 months)? 

That's a hard one.  Since we are specifically saving for our kids' college we do put it in a 529 plan.  Since you're more open to them using the money for a business or the like that wouldn't really work.  At the same time, if it is going to be used for education it is financially beneficial (if finacial aid is a consideration in your situation) for the money to be in the parents name.

Hmmm... what is a good savings vehicle for a significant amount of money for a child?

[Super~Single~Mama]

Originally Posted by CatsCradle 

The reason this bristles me is that my grandparents put a considerable amount of money in the bank for me when I was a minor.  My bio-mom, Dad's ex-wife, fell in love with another man and used the money in my account to fund her wants, needs and desires.  She was able to do this because she was named a custodian on the account.  I don't mean to be all negative and stuff, but setting up a trust allows a legal recourse if one parent or custodian should hit the road with the cash. 

I'm sorry you had a shitty experience. I have had the opposite experience with my joint account with my dad! (it was opened as a custodial account 25 years ago or something like that, and I have not taken his name off of it) I still use the account very little, and he only has access to the savings account, not the checking portion. I use it to pay him for my phone (we're on a family plan, its much cheaper), and I put the money in the savings account, and call him to say "Ok, the money is there, take it out" - he would never touch my money otherwise. He's also the only one named on the account other than me - my mom is not named for some reason (although it would probably be fine if she were, it just didn't happen that way, and they've been married for 35years in August).

[jillybean720]

Originally Posted by Imakcerka 

YAY... a post that solidifies my lack of hope...
 

Why do you say that?

While I do wish I'd had more freedom to be a college kid during college instead of stressing about money and working all the time, it wasn't all bad. I'm very financially responsible and, despite "only" having a generic undergrad degree, I started earning a six-figure salary at age 28 (I'm now 29). On the down side, I think I've been shaped into a workaholic - I have a very hard time tearing myself away from work to try to take vacations or breaks, and I sometimes take work issues too personally.
 

We all do the best we can, and we all want the best for our kids, but that "best" is different for every parent - and for every child.

[KSLaura]

OP- Just curious, what kind of scholarships are available to kids of disabled vets?  I did a search and it didn't come up with much.  Is a specific percentage required (30% disabled, service connected)?  I definately want to look into this for my kids!  :)

I agree with certifications being very important in the IT world.  If my kids choose IT, I will definately push them towards as many certifications as possilbe.  Where I work, though, a 4-year degree is becoming more of a requirement.  This is in addition to the certifications.  Security clearance also helps. 

We are saving a little each month in a 529 for each kid.  I know this won't come close to funding all of their college expenses, but I'm hoping it will cover a large chunk.  My kids are 3 and 6 and they both know that college is expected.  They will likely have to take out some loans (as I did), but that is ok.