How much financial support do you plan on giving to your kids after high school?

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D-Dog
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How much financial support do you plan on giving to your kids after high school?

Post by D-Dog »

My kids are currently in high school and I've been thinking about what level of financial support I will continue to give to them. I want them to learn to be financially responsible adults, but I also want to help them out financially to get them going in life. I'm wondering what others plan on doing (or have done) for their kids from a financial perspective.

My current plan includes:
  • I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
  • I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.
  • I will continue to keep them on my cell phone plan through college.
  • I will continue to fund Roth IRAs for them through college.
  • After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.
  • I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
  • I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
Any thoughts? What would you do (or did you do) differently? I'm also interested in whether you communicated your plan up front with your kids. Thanks.
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RickBoglehead
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Re: How much financial support do you plan on giving to your kids after high school?

Post by RickBoglehead »

You're going to communicate this plan to a high school kid? Good luck with that.

What you do you do as a parent. Sitting down and explaining a 10 step process will simply put them to sleep.

Our kids were required to have a job in high school, but that plan changed when the younger one had college math to take at night, and robotics, and no free time. He was required to work 10 hours a week during college for the first 2 years. Both had summer jobs in colleges or internships, or coops. That gave them spending money.

No free car promised for college. Both got cars to USE last 2 years, 10+ year old models. They paid all expenses with earnings from summer or school jobs. We covered insurance during the school year only.

We paid for grad school for both, one got most of it paid for by employer.

We did not fund IRAs, they did that with earnings. We matched an amount I think. We loaned one money for relocation when his employer only reimbursed, but made it conditional on full Roth IRA funding that year, paid for by us and then reimbursed within 6 months.

We paid for nothing after college. 6 months free room and board at home, then leave or pay room and board. Escalate cost starting at 6 months, every 3 months added 50%.

Oldest got married, they said they had it covered. We told them we were contributing $X (about 60% of the cost we had heard them discuss), they were very appreciative. Her parents don't have much. However, it was significantly less than what some discuss on this forum, which is insane IMO. Luckily they have same viewpoint.

It matters not what others do. You do you, and your children will either be appreciative or they won't. Doesn't need to be approved by a forum.
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Wannaretireearly
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Re: How much financial support do you plan on giving to your kids after high school?

Post by Wannaretireearly »

D-Dog wrote: Thu Jul 29, 2021 6:34 pm My kids are currently in high school and I've been thinking about what level of financial support I will continue to give to them. I want them to learn to be financially responsible adults, but I also want to help them out financially to get them going in life. I'm wondering what others plan on doing (or have done) for their kids from a financial perspective.

My current plan includes:
  • I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
  • I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.
  • I will continue to keep them on my cell phone plan through college.
  • I will continue to fund Roth IRAs for them through college.
  • After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.
  • I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
  • I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
Any thoughts? What would you do (or did you do) differently? I'm also interested in whether you communicated your plan up front with your kids. Thanks.
Oh God D-dog. This is a great (but scary) list. I will also do everything you state, for my 13 and 10 year old.
My parents did almost everything in this list, with less means. Will I ever be able to retire? Lol.
“At some point you are trading time you will never get back for money you will never spend.“ | “How do you want to spend the best remaining year of your life?“
sailaway
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Re: How much financial support do you plan on giving to your kids after high school?

Post by sailaway »

Many colleges are set up to deter on campus students from having cars (ie, expensive parking on the opposite side of campus from the dorms). If they are in a college town, they probably aren't necessary, unless you want them to have one to drive themselves home.
livesoft
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Re: How much financial support do you plan on giving to your kids after high school?

Post by livesoft »

We planned on giving our kids the minimal financial support they would need to stay afloat. Indeed, we expect them to support us instead. Already, the oldest has taken over the cell phone family plan, so we do not have to worry about that. The youngest does Netflix for us. I expect more support from them as time goes on.
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gubernaculum
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Re: How much financial support do you plan on giving to your kids after high school?

Post by gubernaculum »

Be flexible. Many things are kid dependent.
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FIREchief
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Re: How much financial support do you plan on giving to your kids after high school?

Post by FIREchief »

D-Dog wrote: Thu Jul 29, 2021 6:34 pm My current plan includes:
  • I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
  • I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.
  • I will continue to keep them on my cell phone plan through college.
  • I will continue to fund Roth IRAs for them through college.
  • After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.
  • I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
  • I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
Any thoughts? What would you do (or did you do) differently? I'm also interested in whether you communicated your plan up front with your kids. Thanks.
Your plan has the official FIREchief stamp of approval. I think you are a great parent and, assuming that your kids do (at least most of) their part, you'll all be happy in the end. 8-) I would share your plan if your kids were the type that would see the great opportunity. If not, I don't know what I would do.

What you've described is pretty much what was done for me (except no cell phones or IRAs back then, but gas was also covered). I did my part working my butt off on a STEM degree which served me well for decades at Megacorp. I have dear Mom to thank for that! :beer
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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FIREchief
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Re: How much financial support do you plan on giving to your kids after high school?

Post by FIREchief »

gubernaculum wrote: Thu Jul 29, 2021 6:57 pm Be flexible. Many things are kid dependent.
D-Dog indicated that the kids are in high school. We don't know his/her kids but D-Dog certainly does by this point. 8-)
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
finite_difference
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Re: How much financial support do you plan on giving to your kids after high school?

Post by finite_difference »

livesoft wrote: Thu Jul 29, 2021 6:56 pm We planned on giving our kids the minimal financial support they would need to stay afloat. Indeed, we expect them to support us instead. Already, the oldest has taken over the cell phone family plan, so we do not have to worry about that. The youngest does Netflix for us. I expect more support from them as time goes on.
Did you intentionally or unintentionally/subliminally push your offspring into high-paying occupations?
The most precious gift we can offer anyone is our attention. - Thich Nhat Hanh
Normchad
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Re: How much financial support do you plan on giving to your kids after high school?

Post by Normchad »

D-Dog wrote: Thu Jul 29, 2021 6:34 pm My kids are currently in high school and I've been thinking about what level of financial support I will continue to give to them. I want them to learn to be financially responsible adults, but I also want to help them out financially to get them going in life. I'm wondering what others plan on doing (or have done) for their kids from a financial perspective.

My current plan includes:
  • I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
  • I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.
  • I will continue to keep them on my cell phone plan through college.
  • I will continue to fund Roth IRAs for them through college.
  • After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.
  • I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
  • I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
Any thoughts? What would you do (or did you do) differently? I'm also interested in whether you communicated your plan up front with your kids. Thanks.
This is basically my plan as well.

The kid is out of college now. Still on my cell phone plan, but that’s about it.

They will eventually get my money anyway. So if it could benefit them now, I’d give it to them. I don’t really see that coming up though.

I will likely continue to invite them on family vacations and I’ll foot the bill for that.
livesoft
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Re: How much financial support do you plan on giving to your kids after high school?

Post by livesoft »

finite_difference wrote: Thu Jul 29, 2021 7:01 pmDid you intentionally or unintentionally/subliminally push your offspring into high-paying occupations?
Not that I know of. My oldest has essentially the same education, credentials, and career as my spouse: Civil Engineer, PE. My youngest has his dream job in sports medicine though not as a physician.
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MathWizard
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Re: How much financial support do you plan on giving to your kids after high school?

Post by MathWizard »

Other than the cell phone plan that is exactly what we have done.

My oldest is just in the process of buying a house.

He had talked about pulling money from his 401k for first time home buyers. I asked how much he would be pulling,since he'd also need to pull much more to at the taxes as well. I told him we could probably loan him the amount he would pull from the 401k and pay it back over the next few years.

He bought house for which he will still have a decent amount left over after 20% down, so this was not needed.

He's also the one we have in case we other not handle finances, so we certainly trust him.
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anon_investor
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Re: How much financial support do you plan on giving to your kids after high school?

Post by anon_investor »

gubernaculum wrote: Thu Jul 29, 2021 6:57 pm Be flexible. Many things are kid dependent.
+1. 1 kid may need $0 in help after college, the other a lot. Would you not help the one that did need help?
finite_difference
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Re: How much financial support do you plan on giving to your kids after high school?

Post by finite_difference »

livesoft wrote: Thu Jul 29, 2021 7:04 pm
finite_difference wrote: Thu Jul 29, 2021 7:01 pmDid you intentionally or unintentionally/subliminally push your offspring into high-paying occupations?
Not that I know of. My oldest has essentially the same education, credentials, and career as my spouse: Civil Engineer, PE. My youngest has his dream job in sports medicine though not as a physician.
Those are well-paying professional occupations. My wife could have been an amazing artist but was pressured/forced by her parents to become an accountant. Not to take necessarily care of them but herself, although the idea is similar.

It is eminently practical to encourage my kids to follow a professional career trajectory. But what if they have the dream and talent for something else?
The most precious gift we can offer anyone is our attention. - Thich Nhat Hanh
stoptothink
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Re: How much financial support do you plan on giving to your kids after high school?

Post by stoptothink »

-College (4yrs tuition at local U) is already covered.
-They are welcome to live at home, during college and after (for a short while). We're within ~6 miles of two large universities.
-They'll always have a room in our home should they fall on hard times.

Weddings, cars, cell phones, funding Roth IRAs...we have zero intention of contributing to any of those things. I suppose that could change depending on where we are at in 10-15yrs (their 9 and 6), but it never even crossed the mind of wife and I that we'd get financial help with school (or anything else) after high school so our kids are already incredibly spoiled IMO.
MarkRoulo
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Re: How much financial support do you plan on giving to your kids after high school?

Post by MarkRoulo »

D-Dog wrote: Thu Jul 29, 2021 6:34 pm My kids are currently in high school and I've been thinking about what level of financial support I will continue to give to them. I want them to learn to be financially responsible adults, but I also want to help them out financially to get them going in life. I'm wondering what others plan on doing (or have done) for their kids from a financial perspective.

My current plan includes:
  • I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
  • I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.
  • I will continue to keep them on my cell phone plan through college.
  • I will continue to fund Roth IRAs for them through college.
  • After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.
  • I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
  • I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
Any thoughts? What would you do (or did you do) differently? I'm also interested in whether you communicated your plan up front with your kids. Thanks.
My parents did:
  • 4 years tuition at state school
  • Older car
  • Lived at home rent-free while looking for job and a bit after finding job
For my siblings and me.
Cell phones were a non-issue as were Roth IRAs. My parents did not pay for weddings (that I know of)

We didn't have a specific schedule to move out of the house, but my parents basic model was that as long as we were actively looking for a job OR working a job and saving up (for a while ... months, not years) we could stay home rent-free. None of my siblings ever paid rent to our parents.

I am doing something roughly similar for my child
  • My wife and I budgeted 4 years tuition at a state school (plus room and board at school). Child went to community college for two years (and is transferring now). I was willing to pay a given amount, so two years of "free" would allow for two years of moderately expensive private, but none of the privates he got in to worked out, so ...
  • Car will be paid for if he wants and needs one. It isn't clear that this makes sense given where he is going, but we'll buy one if necessary. Used Honda Civic or something.
  • We might actually GET him a cell phone plan with data for college. Right now he has a dumb phone with minutes but no data. I expect he'll "need" data soon, so ...
  • Roth IRA is a no. We have never given him cash money.
  • Live at home would be similar to my parents. Except that he'll probably leave the state for a job and I've offered to pay living expenses if he want to move somewhere and look for a job rather than find a job first and then move. This is easier because his college costs are lower than budgeted.
  • I don't expect to pay for a wedding.
  • Unforseeen circumstances would need to be some sort of emergency. I'm fine with him being "poor" for a few years.
I *might* pay for a masters degree. His schooling was unusual (we homeschooled K-12 ... he isn't what I would consider "academic" ... he is doing very well at playing the school game, so if he wants to get a masters I'd consider paying for it).

I think launching kids with (a) a skill and/or education, and (b) not debt is a gift. My parents gifted it to me, My grandparents gifted it to my parents and I'm planning on paying that forward.

I also think that letting/forcing the kids to fly on their own has value, so the hope is that he launches and doesn't return to the nest.
smitcat
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Re: How much financial support do you plan on giving to your kids after high school?

Post by smitcat »

What our parents were able to do for us after HS was never a thought when considering what we would do. The list above is more or less what we had originally planned but as our daughter has grown and displayed mostly very good financial habits we will be tranferring more than we thought.
MarkRoulo
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Re: How much financial support do you plan on giving to your kids after high school?

Post by MarkRoulo »

finite_difference wrote: Thu Jul 29, 2021 7:12 pm
livesoft wrote: Thu Jul 29, 2021 7:04 pm
finite_difference wrote: Thu Jul 29, 2021 7:01 pmDid you intentionally or unintentionally/subliminally push your offspring into high-paying occupations?
Not that I know of. My oldest has essentially the same education, credentials, and career as my spouse: Civil Engineer, PE. My youngest has his dream job in sports medicine though not as a physician.
Those are well-paying professional occupations. My wife could have been an amazing artist but was pressured/forced by her parents to become an accountant. Not to take necessarily care of them but herself, although the idea is similar.

It is eminently practical to encourage my kids to follow a professional career trajectory. But what if they have the dream and talent for something else?
This is something I've had to deal with. My wife and I are good with computers. My child is good with people.

So ... guiding this alien life form that has been living with us for 20 years (and who has brought an incredible amount of delight ... I'm very happy he's part of our life) is a lot trickier than I was expecting.

He doesn't want to be an engineer. Or an accountant.

And I'm a HUGE believer in folks avoiding jobs they don't want to do because they will be competing with some people who DO want to do those jobs and you really don't want to be competing with people who will work on getting better "for fun" in their spare time. I was one of those folks regarding computer programming. Much better to be the one getting better because THAT IS HOW YOU WANT TO SPEND YOUR TIME.

My child wants to do something with sports. Play professionally (not going to happen ... he knows this), write about it, coach it (he's done that), broadcast (he's done this, too), film it (yep!), commentate (yep!) ... something.

So we are insisting that he get a "real" education, and then we're going to close our eyes and hope. And I expect him to do fine, though I have no idea how. Good things tend to happen to him ... possibly because he'll contact 500 people looking for an opportunity. And not get discouraged when the first 400 say "no."

We try to enable his dreams, while insisting on some sort of planning for the future.

So we'll try to let him play college baseball as long as he can, but still insist on some minimum level of reputation from the colleges he attends.

I'll know in 10 or 20 years if this worked :-)
teniralc
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Re: How much financial support do you plan on giving to your kids after high school?

Post by teniralc »

MarkRoulo wrote: Thu Jul 29, 2021 7:31 pm
finite_difference wrote: Thu Jul 29, 2021 7:12 pm
livesoft wrote: Thu Jul 29, 2021 7:04 pm
finite_difference wrote: Thu Jul 29, 2021 7:01 pmDid you intentionally or unintentionally/subliminally push your offspring into high-paying occupations?
Not that I know of. My oldest has essentially the same education, credentials, and career as my spouse: Civil Engineer, PE. My youngest has his dream job in sports medicine though not as a physician.
Those are well-paying professional occupations. My wife could have been an amazing artist but was pressured/forced by her parents to become an accountant. Not to take necessarily care of them but herself, although the idea is similar.

It is eminently practical to encourage my kids to follow a professional career trajectory. But what if they have the dream and talent for something else?
This is something I've had to deal with. My wife and I are good with computers. My child is good with people.

So ... guiding this alien life form that has been living with us for 20 years (and who has brought an incredible amount of delight ... I'm very happy he's part of our life) is a lot trickier than I was expecting.

He doesn't want to be an engineer. Or an accountant.

And I'm a HUGE believer in folks avoiding jobs they don't want to do because they will be competing with some people who DO want to do those jobs and you really don't want to be competing with people who will work on getting better "for fun" in their spare time. I was one of those folks regarding computer programming. Much better to be the one getting better because THAT IS HOW YOU WANT TO SPEND YOUR TIME.

My child wants to do something with sports. Play professionally (not going to happen ... he knows this), write about it, coach it (he's done that), broadcast (he's done this, too), film it (yep!), commentate (yep!) ... something.

So we are insisting that he get a "real" education, and then we're going to close our eyes and hope. And I expect him to do fine, though I have no idea how. Good things tend to happen to him ... possibly because he'll contact 500 people looking for an opportunity. And not get discouraged when the first 400 say "no."

We try to enable his dreams, while insisting on some sort of planning for the future.

So we'll try to let him play college baseball as long as he can, but still insist on some minimum level of reputation from the colleges he attends.

I'll know in 10 or 20 years if this worked :-)
I'm not sure that parents who have not experienced what it is like to have a kid who has an interest in the arts or some other type of creative area can really understand that you can't really force these young people into something they don't like. For us, the biggest lesson has been acceptance, support (emotional and a bit of financial) but most importantly, lots and lots of conversations, which means intentionally being in touch with her to know what's on her mind and being ready to offer some guidance at those occasional moments when she's ready to listen. Parenting, we find, is a two way street. Not working to mold them into what we think they "should" be. That's, at least, our experience. Some kids see the world differently. We have chosen to embrace those differences. And regarding having them pay my bills, I'm not sure what lesson that teaches, but if my parents did that to me, I would have pretty quickly lost touch with them. I'm puzzled by that type of parenting approach.
Reamus294
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Re: How much financial support do you plan on giving to your kids after high school?

Post by Reamus294 »

Your kids are very lucky that you are in a position to help that much. It sounds like you have a good plan in place and if I had kiddos, it sounds very similar to what I would plan. Flexibility is always key, and some kids may expect extremely fair treatment while others don’t care.
My spouse and I paid for our own schooling and an grad degrees in our 30s. We stressed a little during undergrad and didn’t focus on schooling as much as we could have because of having to work. I am also glad our parents paid themselves first and focused on saving more for their retirement than funding our school decisions because now we don’t have to worry if they have enough.
I knew my parents would be there for me if I needed it and that was the most important thing and still feel that way. Looking at my siblings and my spouse’s siblings, I think each one requires a different level of information and involvement so only you will know how much and when to share info.
My parents only discussed finances as needed. Their financial position was changing as their 4 kids were going through college so having anything set in stone would have been difficult. They have contributed more towards the grandkids education than their own kids which shows how times and expectations are changing. If you are thinking about it at this level already, I don’t think you can go wrong no matter what you do as long as there is some flexibility and compassion.
gips
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Re: How much financial support do you plan on giving to your kids after high school?

Post by gips »

D-Dog wrote: Thu Jul 29, 2021 6:34 pm My kids are currently in high school and I've been thinking about what level of financial support I will continue to give to them. I want them to learn to be financially responsible adults, but I also want to help them out financially to get them going in life. I'm wondering what others plan on doing (or have done) for their kids from a financial perspective.

My current plan includes:
  • I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
  • I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.
  • I will continue to keep them on my cell phone plan through college.
  • I will continue to fund Roth IRAs for them through college.
  • After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.
  • I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
  • I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
Any thoughts? What would you do (or did you do) differently? I'm also interested in whether you communicated your plan up front with your kids. Thanks.
here are some thoughts:

>>will pay for the cost of tuition and room & board for four years at an in state public university

we told out kids we'd pay > public school if they were admitted to demonstrably better universities. the public schools in NY are not great, they all managed to gain entry into better schools. Anyhow, so here's thing, if your kid get into a top 10 school, say MIT, and you can afford it, are you going to hold the line on your stance? Alternatively, what if one of your kids needs a lot more help/attention than he/she'd receive at a state school, are you going to hold the line?

>>will continue to pay for an older but reliable used car, including insurance, through college.

we didn't pay for a car for any of our three kids through college until this last year, and that was only due to the pandemic. I really don't think they need a car, we did pay for a bicycle though :) We were willing to buy them a used car as a graduation present if they chose to live in a place where one was needed.

have you thought about an allowance through college? we gave our kids a base allowance and explicitly told them not to work during freshman year. After freshman year it was completely up to them, they all worked, which we took as a good sign.

>>After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job

we allowed them to live rent free at home with an understanding that they treat the search for a job as full-time job. once they obtained jobs, we gave them some time to save money but really, they couldn't wait to be out on their own.

I think the other thing to think about is health care. you're going to need to keep them on your health plan until they land jobs. We have ACA and it's fairly costly.

overall, I think you have a thoughtful plan, I'd just be really careful about communicating your plan. My father told me he expected me out of our house 6 weeks after graduation. That a) put a lot of pressure on me and b) it made me feel like I wasn't welcome there for the rest of my life.

and as other's (and you) have pointed out, stay flexible: we plan, god laughs...
best,
MarkRoulo
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Re: How much financial support do you plan on giving to your kids after high school?

Post by MarkRoulo »

teniralc wrote: Thu Jul 29, 2021 7:47 pm
I'm not sure that parents who have not experienced what it is like to have a kid who has an interest in the arts or some other type of creative area can really understand that you can't really force these young people into something they don't like. ...
I think that LOTS of parents are raising kids without trying to force the kids into some predefined template.

It just isn't news and doesn't lead to a book.
MikeG62
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Re: How much financial support do you plan on giving to your kids after high school?

Post by MikeG62 »

D-Dog wrote: Thu Jul 29, 2021 6:34 pm My kids are currently in high school and I've been thinking about what level of financial support I will continue to give to them. I want them to learn to be financially responsible adults, but I also want to help them out financially to get them going in life. I'm wondering what others plan on doing (or have done) for their kids from a financial perspective.

My current plan includes:
  • I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
  • I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.
  • I will continue to keep them on my cell phone plan through college.
  • I will continue to fund Roth IRAs for them through college.
  • After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.
  • I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
  • I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
Any thoughts? What would you do (or did you do) differently? I'm also interested in whether you communicated your plan up front with your kids. Thanks.
I don’t know that my plan would work for you (and vice versa). Everyone’s situation is unique.

Having said that, here’s what we did with regard to your points above.

College costs - originally felt as you did (we’d pay the cost of a good in state public university). Ultimately, we paid for all costs (one stayed in state and the other went to a private university of our state). Just did not want to burden either of them (especially the one who went out of state) with a loan starting out when we had the money to allow them to avoid that.

Auto - we bought very low mileage newer vehicles for them to use while in high school. Wanted them to have vehicles that would be very reliable and with current technology. Shortly after each graduated college (approximately coincident with when they began working full time) we gifted each their car. They got their own insurance (and importantly got off mine) and began paying for all expenses associated with their auto.

Roth IRA’s - nope we did not do that.

Post college - they were welcome to live in our home rent and cost free for as long as they wanted. My oldest stayed about 4 years and my younger one about 3 years. Although they are on my cell phone plan, they began paying for the cost of their line. I think we did this largely because both had jobs that were paying/reimbursing them for their cell phone. I thought it odd that I should be paying and they were getting reimbursed. So I had them begin to pay me.

Wedding - we plan(ned) to give each enough to fund a wedding along the lines my wife and I had when we got married >30 years ago. My oldest is getting married next year and we decided to increase the amount we planned to give by about 25% simply because we concluded they could not have the wedding we were envisioning with the budget we set (our bad).

Oh, and I don’t think we discussed any of this in advance with our daughters. In high school they just didn’t have the perspective to really understand/appreciate it.

Our daughters are ridiculously responsible adults. Both save a sizable % of their income. Neither has ever carried a credit card balance over from one month to the next. And more importantly, they are just genuinely good people (my DW probably gets more credit for this than me).

Not sure how much that helps you, but that’s our story.
Last edited by MikeG62 on Thu Jul 29, 2021 9:00 pm, edited 1 time in total.
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Watty
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Re: How much financial support do you plan on giving to your kids after high school?

Post by Watty »

D-Dog wrote: Thu Jul 29, 2021 6:34 pm My current plan includes:
  • I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
  • I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.
  • I will continue to keep them on my cell phone plan through college.
  • I will continue to fund Roth IRAs for them through college.
  • After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.
  • I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
  • I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
Any thoughts? What would you do (or did you do) differently? I'm also interested in whether you communicated your plan up front with your kids. Thanks.
I am pretty middle class compared to a lot of posters here but that is pretty much what I ended up doing except for funding the Roth. It was not a grand plan, it just sort of worked out that way.

It helped that I only had one kid so the costs did not add up too much.

On picking a college major I joked with my son that I was sending him to trade school and that when I dropped him off at college I was going to drop him off at the college placement center and not the dorm. Us paying for his college was conditioned on him picking a major that had a good job placement rate even if it was not high paying major. That was never an issue since he choose to get a Computer Science major.

One thing I picked up on when my kid was maybe in middle school was that it is important to talk with them at least in general terms about how much you expected to try pay for their education. This of course is important so that if they want to shoot high and go to an expensive college then they will have plenty of time to figure out how to pay the difference.

A less obvious reason that this is very important is that many high school students hear a lot about student loan debt and college costing hundreds of thousands of dollars and they may feel intimidated and feel that college is not for them and not not try hard in high school.

Letting them know early on that you are planning to pay for their college also creates the expectation that they will go to college.

My parents paid for my college and I let me son know that part of why I was paying for his college was that I was passing on what got to him with the expectation that when the time came that he would pass it on and also pay as much as reasonably could for his kids college education if he ever had kids.
D-Dog wrote: Thu Jul 29, 2021 6:34 pm I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
With having a boy we never really thought much about wedding costs but there is no way that we would have paid for a huge wedding. He ended up marrying a woman who has a dad that is an executive and obviously doing well. I never heard the figure but for their wedding he gave them a set amount and they were free to do anything they wanted with it and then use any money that was left over however they wanted. If they wanted to spend more, then they would need to pay for that themself.

Much to my surprise they asked if they could get married in our backyard. We have a pretty typical non-McMansion suburban house but we have a large lot that is almost an acre and most of that is behind the house so we have a huge backyard. They were thinking about having about 40 people at the wedding.

They strung up lots of white LED Christmas lights and similar decorations, rented tables and chairs, and had a upscale BBQ restaurant that caters bring in the food for a buffet, but the food cost was reasonable since they did not pay a wedding venue premium. They had friends volunteer to help serve the food and thing like that. I think there were two or three "friends of friends" that they paid to be helpers too. Since there were not a lot of constraints the guest list grew and somewhere around 100 people came. It was more of a big backyard party than a typical traditional wedding which fit the couples personality well. The stress was an order of magnitude lower and everyone seemed to have a good time. It is not fancy but the subdivision I live in has a pool and a nice clubhouse and that was the backup location in case it rained. Some of the brides girlfriends who had big weddings said that the wish they had done something more like that.

I never heard a final figure but I would guess that the total cost was well under $5,000, maybe even under $4,000.

About six months after the wedding they used the rest of the wedding money to help buy their first house. Everyone involved with the wedding was happy with the way everything worked out.
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Re: How much financial support do you plan on giving to your kids after high school?

Post by rage_phish »

D-Dog wrote: Thu Jul 29, 2021 6:34 pm My kids are currently in high school and I've been thinking about what level of financial support I will continue to give to them. I want them to learn to be financially responsible adults, but I also want to help them out financially to get them going in life. I'm wondering what others plan on doing (or have done) for their kids from a financial perspective.

My current plan includes:
  • I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
  • I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.
  • I will continue to keep them on my cell phone plan through college.
  • I will continue to fund Roth IRAs for them through college.
  • After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.
  • I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
  • I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
Any thoughts? What would you do (or did you do) differently? I'm also interested in whether you communicated your plan up front with your kids. Thanks.
Pretty much exactly what my parents did
As well as paying for the first down payment of my home. What a leg up that was
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quantAndHold
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Re: How much financial support do you plan on giving to your kids after high school?

Post by quantAndHold »

We never funded Roths or bought cars, and by the time eldest got married, all three kids were making more money than their parents, so the kids paid for their own wedding.

As for college, eldest got accepted to an elite private, and we paid for what financial aid didn’t. For her, she was ambitious enough to make use of it, so we considered it money well spent. Middle child got her own scholarship to film school, and youngest went to State. After college, they all had jobs lined up. We helped them with apartment deposits and car down payments, but they’ve been on their own since graduation.

We told them as early as high school that we expected them to go to college and get a bachelors degree, and then support themselves, and that’s exactly what each one did. What we would have done and would have paid for if they had wanted to go to grad school or hadn’t gotten themselves successfully launched straight out of school? I have no idea. It never came up.
Freetime76
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Re: How much financial support do you plan on giving to your kids after high school?

Post by Freetime76 »

MarkRoulo wrote: Thu Jul 29, 2021 7:31 pm
finite_difference wrote: Thu Jul 29, 2021 7:12 pm
livesoft wrote: Thu Jul 29, 2021 7:04 pm
finite_difference wrote: Thu Jul 29, 2021 7:01 pmDid you intentionally or unintentionally/subliminally push your offspring into high-paying occupations?
Not that I know of. My oldest has essentially the same education, credentials, and career as my spouse: Civil Engineer, PE. My youngest has his dream job in sports medicine though not as a physician.
Those are well-paying professional occupations. My wife could have been an amazing artist but was pressured/forced by her parents to become an accountant. Not to take necessarily care of them but herself, although the idea is similar.

It is eminently practical to encourage my kids to follow a professional career trajectory. But what if they have the dream and talent for something else?
This is something I've had to deal with. My wife and I are good with computers. My child is good with people.

So ... guiding this alien life form that has been living with us for 20 years (and who has brought an incredible amount of delight ... I'm very happy he's part of our life) is a lot trickier than I was expecting.

He doesn't want to be an engineer. Or an accountant.

And I'm a HUGE believer in folks avoiding jobs they don't want to do because they will be competing with some people who DO want to do those jobs and you really don't want to be competing with people who will work on getting better "for fun" in their spare time. I was one of those folks regarding computer programming. Much better to be the one getting better because THAT IS HOW YOU WANT TO SPEND YOUR TIME.

My child wants to do something with sports. Play professionally (not going to happen ... he knows this), write about it, coach it (he's done that), broadcast (he's done this, too), film it (yep!), commentate (yep!) ... something.

So we are insisting that he get a "real" education, and then we're going to close our eyes and hope. And I expect him to do fine, though I have no idea how. Good things tend to happen to him ... possibly because he'll contact 500 people looking for an opportunity. And not get discouraged when the first 400 say "no."

We try to enable his dreams, while insisting on some sort of planning for the future.

So we'll try to let him play college baseball as long as he can, but still insist on some minimum level of reputation from the colleges he attends.

I'll know in 10 or 20 years if this worked :-)
If your kid can take 400 no’s and still be enthused, sales might be an area to consider (a no is only a step to yes) - sales is everywhere! Sports equipment, tickets, memorabilia, agent for athletes.... glad you appreciate the gifts he has!
Please spell out new acronyms. Thank you.
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Re: How much financial support do you plan on giving to your kids after high school?

Post by MarkRoulo »

Freetime76 wrote: Thu Jul 29, 2021 9:22 pm ... snip ...

If your kid can take 400 no’s and still be enthused, sales might be an area to consider (a no is only a step to yes) - sales is everywhere! Sports equipment, tickets, memorabilia, agent for athletes.... glad you appreciate the gifts he has!
Thanks!

Yes, my belief is that his destiny is sales. It will be interesting to see how this plays out ... :-)
neverpanic
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Re: How much financial support do you plan on giving to your kids after high school?

Post by neverpanic »

D-Dog wrote: Thu Jul 29, 2021 6:34 pm My kids are currently in high school and I've been thinking about what level of financial support I will continue to give to them. I want them to learn to be financially responsible adults, but I also want to help them out financially to get them going in life. I'm wondering what others plan on doing (or have done) for their kids from a financial perspective.

My current plan includes:
  • I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
  • I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.
  • I will continue to keep them on my cell phone plan through college.
  • I will continue to fund Roth IRAs for them through college.
  • After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.
  • I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
  • I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
Any thoughts? What would you do (or did you do) differently? I'm also interested in whether you communicated your plan up front with your kids. Thanks.
I'm cool with contributing a cake or something, but I am not paying for a dream wedding. That's a firm line in the sand for me. No, we haven't discussed any weddings, but she knows my basic financial principles.

Education and reasonable extras are covered. Sorority is not a reasonable extra, so she pays that on her own. I believe she knew there was no way I'd pay (I may have mentioned it at some point years ago), so she didn't even ask or expect financial support for that. She has a monthly budget and has to make it work.

She has a credit card for gas and for just in case. Thankfully, there have been no emergencies in the ~2 years she's had it. She forgot her debit card once, texted me to ask permission to use the cc for a minor purchase, then venmo'd me the charge amount 5 minutes later. Vehicle maintenance costs are covered, but she has to schedule those appointments. There was supposed to be no vehicle for minimum 1 year of school, but covid forced them to live off-campus, so I had to adjust the original plan.

I'm paying for undergrad, but she expects to cover the majority of her costs for any grad school.

As long as I have a place to live, she'll always have a room and a place to call home. That standing offer does not extend to any future boyfriends.

We're a very privileged family, but while it seems so many former friends have been spoiled into ineffectiveness (yet have enough family wealth not to have to worry about it), I count myself as extremely fortunate that our daughter has inherited my financial values.
I am not a financial professional or guru. I'm a schmuck who got lucky 10 times. Such is the life of the trader.
bluebolt
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Re: How much financial support do you plan on giving to your kids after high school?

Post by bluebolt »

My parents did the following and we plan on doing the same:

Use of a car from driving age through leaving for college (gas was my responsibility)
Pay for college tuition, room & board
Pay for grad school

They expected me to contribute earnings from age 14-23 to my tuition, room & board, and expenses. Ended up being 1 full year of tuition, room & board, and four years of expenses.
fyre4ce
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Re: How much financial support do you plan on giving to your kids after high school?

Post by fyre4ce »

A few thoughts.

Foremost, thinking about my own transition from childhood to adulthood, I wish my parents had given me a better financial education. Frankly, that will likely be more valuable to your kids than any dollar amount you could give them. If the graduate knowing how to save, invest, budget, etc then they will have the tools to thrive regardless of what level of support you provide. Any $ I would provide would be through that lens- ie. giving them a “daddy match” into a Roth IRA, having them manage their own accounts and make investment trades, maybe giving them a “high yield” (eg. 1% per month) parent sponsored savings account, having them cover their own discretionary expenses with their own money, etc. It took me many years after school to learn financial basics and I had many missed opportunities.

The list you give sounds reasonable. But you should remain flexible. For example, I didn’t work at all through high school, but I took college courses over the summer, took ten AP classes over 10-12 grade, and had extra curricular activities and sports. There would have been no time for a job. Likewise in college, I was involved with an unpaid research project that consumed all my free time (and then some) but was squarely in my desired career path. And it worked out well for me. But I did work hard during all three summers at paid internships and used the earnings to pay for food and other expenses during the year. Tuition was paid for by my parents and student loans, which I paid off in about 8 years. My parents bought me a cheap car on a 5 year loan when I needed one for an internship, and paid the expenses, but transferred the loan to me when I graduated and I took over the payments for the remaining 3 years.

When I graduated, I found an employer with a paid graduate degree benefit, and went and got my masters at night. My point is, while it’s good to plan ahead and think about what support you’re willing to give, be prepared to change the plan, or at least tailor it to the child’s situation. This is another reason why you shouldn’t lay it out in writing in advance.
RuralLivin
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Re: How much financial support do you plan on giving to your kids after high school?

Post by RuralLivin »

I did pretty much the same approach as D-Dog with some changes. My daughter received the state lottery funds (high GPA) for most of her tuition costs at UGA and I wanted to support her maintaining the scholarship. I paid board, full meal plan, lab fees, and other UGA fees from savings.

I also provided AAA membership, emergency charge card, cell phone, car insurance and maint. on old safe car, $200 every two weeks into checking account for misc stuff (fun, stress relief, eating out, clothes, toiletries, etc.) I didn't question anything she spent the $200 on (I could see her account every two weeks). She said the regular deposit intervals forced her to think in terms of budgeting while kids that had lump sums ran out of money toward the end of the term.

Between the sophomore and junior year, I paid for a study abroad summer program to New Zealand. She worked in the chemistry lab in her junior and senior year. The only student loan (because of solo apartment her senior year) was paid off a few months after graduation.

Once she got graduated and got her first job, I put $5000.00 in her account (apartments fees, initial car insurance, purchase professional clothing, first month living expenses, etc) I also purchased a new Subaru Outback since she needed an AWD vehicle due to job location.

I wanted to do my part helping her getting started in her career. I strongly believe in setting people up for success pays off and college should be fun.

If she had gotten locked up, Mom was going to bring the camera and take selfies outside the jail!
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Re: How much financial support do you plan on giving to your kids after high school?

Post by momvesting »

Everyone's situations are different and also unexpected circumstances come in to play. For example, we did something I would have never expected. We bought a brand new, $20k car for our 16 yr old. It isn't really "hers", it is "ours". We bought it because we needed her to have a car to take care of getting herself to/from school and activities as well as help us out. I had an older, gas guzzling SUV that we wanted to get rid of but I was driving less miles than everyone else, so I kept driving it. So for two years we had 3 cars, then got rid of the SUV. "Her" car is now my car, although we share it right now but it stays with me when she heads off to college in a few weeks.
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Re: How much financial support do you plan on giving to your kids after high school?

Post by invest4 »

D-Dog wrote: Thu Jul 29, 2021 6:34 pm My current plan includes:
1. I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.

2. I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.

3. I will continue to keep them on my cell phone plan through college.

4. will continue to fund Roth IRAs for them through college.

5. After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.

6. I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.

7. I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
I modified your post a bit by adding numbers to make it easier to match up the items.

Married with 4 kids. Single income.

1. Junior college and state university. Living at home. Grad school...also not sure, but small, if any.

2. Used car. Kids paying gas at onset, annual registration and oil changes at 18, car insurance at 19. Those who are old enough, have jobs. We help ensure an appropriate balance with school. We purposely give them increasingly more financial responsibility for themselves along the way. Discussion of financial matters including the how, what, and why of doing things begin at an early age and are regularly discussed as they grow.

3. On our plan...but they pay for their share beginning at 18.

4. We do not contribute to any investments. They can and do so for themselves.

5. They may continue living at home as long as they are productive and have a plan. I haven't thought about it too deeply, but could see we may ask for some contribution to expenses. Regardless, would be a very positive situation for them.

6. We will contribute...not sure how much.

7. No doubt.
jackholloway
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Re: How much financial support do you plan on giving to your kids after high school?

Post by jackholloway »

Your list is pretty close to mine.

We have saved about halfway between a state school and an expensive private school, and are prepared to pay whatever it ends up costing to go to the right school. What is not spent on UG will go to grad school.

The incidentals you named are about what we were thinking - we have a grandfathered cell plan that's only 30 bucks a month.

My wife had a car in college, I did not, but I had an inheritance that bought my first (used) car. Man, I loved that car.

My parents didn't cover my wedding, but they did cover my sister's. Seems only fair.

We have not come up with what we will do if Dear Child needs to move back home, but it has happened to various family members with various combinations of rent-free and rent-charged, and they turned out ok.
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Re: How much financial support do you plan on giving to your kids after high school?

Post by bltn »

livesoft wrote: Thu Jul 29, 2021 6:56 pm We planned on giving our kids the minimal financial support they would need to stay afloat. Indeed, we expect them to support us instead. Already, the oldest has taken over the cell phone family plan, so we do not have to worry about that. The youngest does Netflix for us. I expect more support from them as time goes on.
That s my idea of a retirement plan!
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firebirdparts
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Re: How much financial support do you plan on giving to your kids after high school?

Post by firebirdparts »

I guess you've noticed people just as long as I have. It's pretty alarming how dysfunctional people do get when parents supplement their lifestyles. To be honest I noticed it when I was your kid's age.

So I think it's important to give them the impression that you don't care how they live. They can just live according to their achievements. If you get in an I-don't-care contest, be sure you win. Mamas can't always pull it off.

I would say 100% tuition and fees, books, room and board, and even a car, is fine if they are studying something that people work at when they graduate. They should be pursuing internships, but the future benefit is more critical than the money.

To some degree, of course, you know your kids and how crazy they are, and what % of their brain actually works.

When he was in college, I told my son, "Son, if you get a job, work 40 years, live frugally, and save your money, someday after 40 years of hard work you can have the lifestyle that you've already got right now."
This time is the same
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Re: How much financial support do you plan on giving to your kids after high school?

Post by jharkin »

It’s a well thought out plan, D-dog.
Mine are still 8 years out from school so I haven’t put as much thought into it, but short of the Roth part your proposal is probably roughly what I will *try* to do.. assuming I can afford it. They will be expected to have skin in the game by at minimum work study and summer jobs for spending money.

Like another poster mid thread I am closer to middle/upper middle class than many of you. My wife and I are the first in our family to have any sort of means and neither of us got much help. My parents kept me in a 10yr old junker car, covered health ins and tried to pay a little of school but I mostly paid my own way on scholarships and loans. And we both worked during undergrad for spending money, paid our wedding out of pocket and paid for our first house completely on our own. I’ve already been partially supporting my own aging parents on and off since my early 30s ( please! Secure retirement first before supporting kids).
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Re: How much financial support do you plan on giving to your kids after high school?

Post by chazas »

livesoft wrote: Thu Jul 29, 2021 6:56 pm We planned on giving our kids the minimal financial support they would need to stay afloat. Indeed, we expect them to support us instead. Already, the oldest has taken over the cell phone family plan, so we do not have to worry about that. The youngest does Netflix for us. I expect more support from them as time goes on.
Why?
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LiveSimple
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Re: How much financial support do you plan on giving to your kids after high school?

Post by LiveSimple »

livesoft wrote: Thu Jul 29, 2021 6:56 pm We planned on giving our kids the minimal financial support they would need to stay afloat. Indeed, we expect them to support us instead. Already, the oldest has taken over the cell phone family plan, so we do not have to worry about that. The youngest does Netflix for us. I expect more support from them as time goes on.
Following your guidance, our kids are supporting us with the cell phone plan and Netflix, as well. :D
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CyclingDuo
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Re: How much financial support do you plan on giving to your kids after high school?

Post by CyclingDuo »

D-Dog wrote: Thu Jul 29, 2021 6:34 pm My kids are currently in high school and I've been thinking about what level of financial support I will continue to give to them. I want them to learn to be financially responsible adults, but I also want to help them out financially to get them going in life. I'm wondering what others plan on doing (or have done) for their kids from a financial perspective.
You asked what others have done, so here goes...
D-Dog wrote: Thu Jul 29, 2021 6:34 pmMy current plan includes:
  • I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
We paid for undergraduate and graduate schooling for our children - both state university and private universities. They had skin in the game with jobs during high school and college, paid internships, talent scholarships, etc... but there was still plenty of costs to cover that our plan paid for as we had saved in their college education accounts for 18-22 years. Everyone graduated debt free and are into their working careers in good financial order as a result of $0 debt. There was plenty of remaining funds in what was their college education accounts that morphed into being their own individual brokerage accounts.
D-Dog wrote: Thu Jul 29, 2021 6:34 pm
  • I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.
Ours both had older used SUV's that we paid cash for and also paid for all the insurance, registration/tax, repairs. Both kids actually ended up hitting a deer with their respective SUV's during their college years, but we paid the deductibles. Gas came out of their slush funds - whether that was from their education accounts or the income they were bringing in from paid internships and summer jobs - does it really matter? :beer
D-Dog wrote: Thu Jul 29, 2021 6:34 pm
  • I will continue to keep them on my cell phone plan through college.
We did this as well, and still do thanks to a perk at work that includes a heavily discounted plan for the entire family.
D-Dog wrote: Thu Jul 29, 2021 6:34 pm
  • I will continue to fund Roth IRAs for them through college.
They funded their own thanks to summer jobs and paid internships. I did and still do their taxes since I enjoy the process, so am able to talk them into sending any refunds right into their IRA accounts from the IRS. I've been involved in other threads here at BH on the pros and cons of kids working in high school and in college, but we pretty much demanded it from ours and in retrospect are glad that we used that approach.
D-Dog wrote: Thu Jul 29, 2021 6:34 pm
  • After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.
Both of our kids remained on our health insurance plan (through our work place plans) until they hit age 26. As mentioned above, they both continue on our cell phone plan (due to my discount via work). They are now on their own health insurance and everything else is on their own. That being said, last year one did come home for 8 months during Covid due to shut down related job loss, but then went back after landing a great apartment deal and a new job. He had unemployment income during his stay with us and bought his own groceries, paid for his gas, etc... . He also took advantage of the time and picked up an additional certification for his career and paid for the training himself out of his unemployment and stimulus checks.

I wouldn't rule out us paying for an occasional airline ticket to fly home and see us from time to time in the future... 8-)
D-Dog wrote: Thu Jul 29, 2021 6:34 pm
  • I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
Certainly, we will pay for our daughter's wedding but no need to talk budget until we get news she is getting married. Rehearsal dinner for our son if and when that occurs as well. We're old school tradition like that.
D-Dog wrote: Thu Jul 29, 2021 6:34 pm
  • I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
Yes, life happens and being in a financial position to be flexible and help is key.
D-Dog wrote: Thu Jul 29, 2021 6:34 pmAny thoughts? What would you do (or did you do) differently? I'm also interested in whether you communicated your plan up front with your kids. Thanks.
Each family and household is different, so I wouldn't want to try and find any faults with your plans. In terms of communicating things to your kids, I think it came out in bits and pieces along the years. They were well aware of their college education funds and why we were saving for them. They were also well aware that going to college was the plan. The discussion of tuition and costs probably began during their high school years and got more focused in their junior/senior years as we visited schools, talked careers, and discovered their passions.

In retrospect, it all goes by rather quickly, so try and enjoy it each and every day.

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YeahBuddy
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Re: How much financial support do you plan on giving to your kids after high school?

Post by YeahBuddy »

I'll help but I'm not paying full boat. I'll help them buy reasonable vehicles. I didn't receive any help from my parents besides help with my vehicles and I believe it made me more financially wise than most of my peers, plus we don't have the means to support them 100% through college. They can live at home as long as they are trending in the right direction.
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backpacker61
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Re: How much financial support do you plan on giving to your kids after high school?

Post by backpacker61 »

I was able to lower the costs of going to university significantly by not having a vehicle for most of the time I was there. I lived on campus. Frankly, my grades were probably better by not having the distraction of having a vehicle to deal with. No parking permits, insurance, registration, maintenance, fuel, etc.

I did have a loaner car from my folks during my last year in graduate school.

My graduate school costs (tuition, room, board, books) were 100% funded by teaching and research assistantships funded by DoD (I was in STEM). I was on my Dad's health insurance, but that was their only expense for my graduate school.

At a point (much) later in life, my parents (realistically) worried about estate tax thresholds, and gave my sibling and I amounts up to the annual gift tax limits. By that point, it was clear that my parent's retirement was more-than adequately funded, and that my sibling and I managed our financial affairs in much the same fashion that my parents had before us.
Last edited by backpacker61 on Fri Jul 30, 2021 7:16 am, edited 1 time in total.
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dcabler
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Re: How much financial support do you plan on giving to your kids after high school?

Post by dcabler »

Not dissimilar to what we do but we never sat down and made a list, but rather discussed it over time.
By the time she was in high school she already knew:
- We had purchased a Texas Tomorrow Fund (the original one) which would pay for her tuition at any in-state college. And we told her we would not pay any additional tuition that this didn't pay for and that she would need to pay any delta, either via scholarships or her own savings that she may have accumulated or may accumulate via working. She ended up going to college at a public, in-state university.
- Over the course of her junior and senior year, we discussed more. Anything directly school related expenses not paid for by her TX tomorrow fund (on-campus room/board/books/etc.) we would pay for. By the time she actually started college, she got a decent scholarship. We then told her that we would pay whatever her TX Tomorrow Fund + Scholarship wouldn't pay for. We also pay her a monthly allowance for incidentals/entertainment. It's not huge and she has to manage this on her own. Overall, it's been surprisingly cheap for us!
- The baseline for the above is and has always been "as if she was living on campus". This fall semester, she is moving off campus. The delta we will pay will still be vs. the baseline of living on campus. Before she committed to the apartment, she ran the spreadsheet analysis and saw that this would still work for her. It helped that during the last year, she was doing all of her classes online and couldn't spend all of her scholarship money so she built up a nice reserve.
- She has my old Honda Civic, still titled to us, and we pay for her insurance (liability only) and she pays for gas. Hope it lasts another 1.5 years till she graduates. She uses our Netflix/Hulu/Roku/etc. accounts and we pay for her mobile as part of our family plan.

Beyond all of that, we're still her parents and we shall remain flexible since the future is unknowable.

Anyway, not the college experience I had based on my and my family's financial situation at the time, but more than happy to do this differently for her. And it more closely matched my friends' situations in college and it appears we've all done well, fortunately!

Cheers.
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Re: How much financial support do you plan on giving to your kids after high school?

Post by livesoft »

chazas wrote: Fri Jul 30, 2021 6:45 am
livesoft wrote: Thu Jul 29, 2021 6:56 pm We planned on giving our kids the minimal financial support they would need to stay afloat. Indeed, we expect them to support us instead. Already, the oldest has taken over the cell phone family plan, so we do not have to worry about that. The youngest does Netflix for us. I expect more support from them as time goes on.
Why?
It will make them feel better. Some of the ways to feel good are to be kind, generous, and experience gratitude. Also, they don't have to worry about other gifts on birthdays and holidays, as in, "We got you Hulu, so what movies do you want to watch?"

OK, the real reason is that they thought our internet and phone plans sucked so much that they they couldn't use them at all when they came to visit, so they just took matters into their own hands.
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jeep5ter
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Re: How much financial support do you plan on giving to your kids after high school?

Post by jeep5ter »

I will provide the same as my parents did.
1. Four years of university tuition and room and board.
2. A year of living at home after graduation while looking for a job.
3. A portion of the down payment on their first home.
4. Give a set amount to each child to use for a wedding, which they can spend or save as they wish.
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Re: How much financial support do you plan on giving to your kids after high school?

Post by ClevrChico »

We are planning to cover most/all of their undergrad. That will depend on the cost of the college they choose and any scholarships. We'll do as much as we can.

I'll let them borrow our cars if needed. We have two barely used cars sitting in the garage. That's IF they want to drive, as they have expressed little interest so far.

After undergrad, they will be on their own.
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Re: How much financial support do you plan on giving to your kids after high school?

Post by KESP »

D-Dog wrote: Thu Jul 29, 2021 6:34 pm My kids are currently in high school and I've been thinking about what level of financial support I will continue to give to them. I want them to learn to be financially responsible adults, but I also want to help them out financially to get them going in life. I'm wondering what others plan on doing (or have done) for their kids from a financial perspective.

My current plan includes:
  • I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
  • I will continue to pay for an older but reliable used car, including insurance, through college. They can pay for gas, any traffic tickets, and the deductible if they get in an accident.
  • I will continue to keep them on my cell phone plan through college.
  • I will continue to fund Roth IRAs for them through college.
  • After college, I don't plan on paying for much, but would allow them to live at home rent free as long as they are working and have a plan to move out. I might bend this a bit if they are still searching for a job.
  • I will contribute to the cost of a wedding. I haven't decided how much, and I haven't told them I will do this.
  • I'm sure there will be unforeseen circumstances so I know I will have to be flexible.
Any thoughts? What would you do (or did you do) differently? I'm also interested in whether you communicated your plan up front with your kids. Thanks.
We did all those things, except funding a Roth. It helped we had 2 kids who never gave us any trouble and made good decisions. The summer they graduated, both got jobs and moved out 2 weeks later. That was it. I don’t understand parents who are able to pay for a college education and don’t. This results in debt for your kid and a much longer stay at home.
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Re: How much financial support do you plan on giving to your kids after high school?

Post by TomatoTomahto »

As our financial health has improved, it’s been clear to us that we are a family as much as a couple with kids; it’s a matter of perspective.

I know in the eyes of many BHs, we spoiled our kids. On the basis of observation and reading (eg, The Nurture Assumption), I feel more strongly than ever that my kids’ financial natures are not as much influenced by us as I might have thought a decade ago. The spendthrift kid who had jobs in HS needed every new piece of hockey equipment. The frugal kid who didn’t work for income in HS didn’t want a new hockey stick even though he had grown 3” over the summer.

I am hoping that the spendthrift matures financially by the time he’s 30. The frugal kid is killing it in his job. The two kids from my first marriage are doing well. It matters greatly to me that we treat all of the kids equally (but not necessarily identically), so we gift them to the max annual limit but we use a Crummey Trust for one, direct payments to others, etc. They know that this gifting is not forever, but we will let them know with some advance warning that it’s ending; better they make use of some of it while we are still alive.

Re cars: we bought brand new Volvo XCs for our kids but kept the titles in our names. I made it clear to them, although I’m not sure that it sunk into their teenaged brains, that we did this for our sakes: I did not want to ever get the phone call that are a parent’s nightmare and spend the rest of my life wondering coulda/woulda/shoulda. None of the kids had an accident (other than maybe scraping the curb while parking).
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Re: How much financial support do you plan on giving to your kids after high school?

Post by NotWhoYouThink »

A good start, but a couple of things to note -

They are spending and probably earning money before college. What do they buy? How do they budget? By the time our kids were 16 they had accounts from which they budgeted and paid for clothing and entertainment. We contributed to the accounts, but since one liked to save and not spend and one was the opposite, it gave them both early practice in actions and consequences, and we had an easier time making sure they were treated evenly or "fairly" since we weren't paying for "stuff" for either.
I will pay for the cost of tuition and room&board for four years at an in state public university. If they want to go to a more expensive school, they can pay the difference themselves or take out loans. I'm not sure if I would pay for grad school. I lean towards no, but not sure.
Common misperception on college costs which I have trouble understanding, because parents posting today can't be that far out of college themselves. Or maybe your parents paid. But your kids CANNOT take out big loans to go to private school unless you co-sign, and of course that would be a terrible idea. Neither you nor your kids should take out loans. If you can afford to pay for state schools they can get a great education if they want that, or they might be able to go to a private school cheaper than instate public if they get merit based aid. (Beware of course that a lot of non-stem, non-finance majors will fill their heads up with goop these days, liberal arts in American academia aren't what they used to be.)

What is this grad school of which you speak? MBA? (why would you pay for that before they have spent some time in the working world?) Law? (Huge expense with low likelihood of earnings power to match unless they go to a top school, in which case they can earn enough to repay their loans.) Med school? (Huge expense with high likelihood of high earnings, no reason for you to pay unless you are drowning in money.) STEM? (PhD track programs are funded by the university through federal grants. If your kids can't get into sponsored programs they are wasting their time on PhDs) Non-STEM grad or PhD track programs? (Oh heck no)
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