Telling Kids about 529 plans

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills.
marcopolo
Posts: 8446
Joined: Sat Dec 03, 2016 9:22 am

Re: Telling Kids about 529 plans

Post by marcopolo »

stoptothink wrote: Fri Oct 15, 2021 3:08 pm
forgeblast wrote: Fri Oct 15, 2021 11:31 am
stoptothink wrote: Thu Oct 14, 2021 2:56 pm
forgeblast wrote: Thu Oct 14, 2021 1:30 pm I started telling my daughter as soon as we started saving for her 529 that we would have money for her to go to college. As my wife and I are both teachers, we also made sure to tell her she was not going into education. She asked what happens if I do I said you cousin gets your 529 and you have to take out loans. We will not pay for that degree.
Why? Teaching certainly is not one of the higher-paying professions for college grads, but it tends to pay median income salaries and has many other benefits. For some it truly is "a calling", it definitely is for my step-father and maybe my sister as well (she's still early in her career). I guess this is common with people of all professionals, as we are seeing multiple MDs saying they tell their children not to get into medicine. As an exercise physiologist and health scientist, I guess I should council my children to study something else because the data suggests there is little opportunity, even though it has worked out quite well for me.
The amount of education required for keeping the degree/teaching license puts teachers at a huge disadvantage when it comes it comparable education and salary's. The amount of behavioral issues coming to schools and the fact that we do more and more and more for the community that looks at us a glorified baby sitters is frustrating on so many levels.
Pa no long as a guaranteed defined pension for new hires. Medical is not paid for by the district, and we have high deductibles. The one saving grace was the retirement and they took that away for new hires. We have had teachers quit mid year, because they are fed up and can make more outside of education.
We are seeing that very few college grads are going into education so there are no subs. This translates to no break because you need to cover other classes on a daily basis.
The buildings are outdated with very little ventilation, it was 87 in my room in August and the humidity was so bad no posters would stay on the walls. I could go on an on, I am teaching 22 years and every year more gets dumped on us from a local and state level.
In my previous position I lost a handful of employees who went into public school teaching. I can tell you that teaching requires less education/credentialing and pays better, with fewer workdays, than working in a lab as a chemist or biologist (I oversaw our labs as one component of my previous position). I don't really get the poo-pooing of teaching as a job, for an "average" college grad. My sister started at $43k/yr, finished an online masters in 9 months and got an immediate bump to $47k/yr, and has awesome benefits. Not bad for a 26yr old who was a very mediocre student, never did anything else but entry-level work, and (to be honest) isn't really cut out for a lot of other careers. My step-dad now makes ~$80k in the same district, and he actually quit (almost 20yrs ago) his marketing job to teach because it paid as well (he is not one with the drive to move up the ladder), but with better benefits and much better stability.

IMO, if you are an average student and not super driven, you can definitely do worse. Of course, none of us want to think our kids are just average.
Boy, that does not say much for the teaching profession, or at least your perception of it. Does not bode well for our future generations if these are the people that will be teaching our kids to fill those other professions you put more value to.

Our experience was different, we found our kid's teachers to be well educated, and definitely very driven to support our kid's education. But, our kids were in a public school systems that pays teachers quite well, maybe that explains some of the difference.
Once in a while you get shown the light, in the strangest of places if you look at it right.
stoptothink
Posts: 15368
Joined: Fri Dec 31, 2010 8:53 am

Re: Telling Kids about 529 plans

Post by stoptothink »

marcopolo wrote: Fri Oct 15, 2021 3:49 pm
stoptothink wrote: Fri Oct 15, 2021 3:08 pm
forgeblast wrote: Fri Oct 15, 2021 11:31 am
stoptothink wrote: Thu Oct 14, 2021 2:56 pm
forgeblast wrote: Thu Oct 14, 2021 1:30 pm I started telling my daughter as soon as we started saving for her 529 that we would have money for her to go to college. As my wife and I are both teachers, we also made sure to tell her she was not going into education. She asked what happens if I do I said you cousin gets your 529 and you have to take out loans. We will not pay for that degree.
Why? Teaching certainly is not one of the higher-paying professions for college grads, but it tends to pay median income salaries and has many other benefits. For some it truly is "a calling", it definitely is for my step-father and maybe my sister as well (she's still early in her career). I guess this is common with people of all professionals, as we are seeing multiple MDs saying they tell their children not to get into medicine. As an exercise physiologist and health scientist, I guess I should council my children to study something else because the data suggests there is little opportunity, even though it has worked out quite well for me.
The amount of education required for keeping the degree/teaching license puts teachers at a huge disadvantage when it comes it comparable education and salary's. The amount of behavioral issues coming to schools and the fact that we do more and more and more for the community that looks at us a glorified baby sitters is frustrating on so many levels.
Pa no long as a guaranteed defined pension for new hires. Medical is not paid for by the district, and we have high deductibles. The one saving grace was the retirement and they took that away for new hires. We have had teachers quit mid year, because they are fed up and can make more outside of education.
We are seeing that very few college grads are going into education so there are no subs. This translates to no break because you need to cover other classes on a daily basis.
The buildings are outdated with very little ventilation, it was 87 in my room in August and the humidity was so bad no posters would stay on the walls. I could go on an on, I am teaching 22 years and every year more gets dumped on us from a local and state level.
In my previous position I lost a handful of employees who went into public school teaching. I can tell you that teaching requires less education/credentialing and pays better, with fewer workdays, than working in a lab as a chemist or biologist (I oversaw our labs as one component of my previous position). I don't really get the poo-pooing of teaching as a job, for an "average" college grad. My sister started at $43k/yr, finished an online masters in 9 months and got an immediate bump to $47k/yr, and has awesome benefits. Not bad for a 26yr old who was a very mediocre student, never did anything else but entry-level work, and (to be honest) isn't really cut out for a lot of other careers. My step-dad now makes ~$80k in the same district, and he actually quit (almost 20yrs ago) his marketing job to teach because it paid as well (he is not one with the drive to move up the ladder), but with better benefits and much better stability.

IMO, if you are an average student and not super driven, you can definitely do worse. Of course, none of us want to think our kids are just average.
Boy, that does not say much for the teaching profession, or at least your perception of it. Does not bode well for our future generations if these are the people that will be teaching our kids to fill those other professions you put more value to.

Our experience was different, we found our kid's teachers to be well educated, and definitely very driven to support our kid's education. But, our kids were in a public school systems that pays teachers quite well, maybe that explains some of the difference.
My sister teaches 6th grade, my step-father teaches freshman and sophomore English at the #2 ranked public school in the state. My step-father is fantastic at his job, having won multiple district teacher of the year awards. He also started and still coaches one of the top debate programs in the entire mountain west. Being a good teacher takes a unique skill-set, one that may not translate great to other occupations. I did undergrad at UCLA and went on to MS and PhDs at other top universities, my sister right behind me went to Brown (then Oxford and NYU), we had a ton of classmates go HYPMS - we were all taught by fantastic teachers, zero of whom went to a top university.

I don't have a low perception of teachers, I am realistic in that I don't expect our nation's top students to become public school teachers, nor do I think they would necessarily make the best teachers for our children. In fact, having taken classes from world-renowned professors myself, it is often the opposite.
Last edited by stoptothink on Fri Oct 15, 2021 4:33 pm, edited 1 time in total.
vinhodoporto
Posts: 300
Joined: Tue Dec 24, 2019 9:14 am

Re: Telling Kids about 529 plans

Post by vinhodoporto »

I think the answer varies a lot depending on the family and the kid.

When our oldest was a freshman or sophomore in high school we told them to focus on doing their best and that they didn’t have to worry about how to pay for college. They are naturally driven but prone to anxiety so I think this was a weight off their shoulders and helped them perform better. We have not explicitly told them that if something such as low grades or getting in trouble happened that we’d reevaluate but that is what would happen.

Our current high schooler knows the deal their older sibling got so we told them the same thing.

FWIW I 100% put myself through college and a masters degree and my spouse mostly put themselves through undergrad and got two masters 100% on their own. While this may have “built character” it also meant we missed out on a lot of opportunities.
marcopolo
Posts: 8446
Joined: Sat Dec 03, 2016 9:22 am

Re: Telling Kids about 529 plans

Post by marcopolo »

stoptothink wrote: Fri Oct 15, 2021 4:15 pm
marcopolo wrote: Fri Oct 15, 2021 3:49 pm
stoptothink wrote: Fri Oct 15, 2021 3:08 pm
forgeblast wrote: Fri Oct 15, 2021 11:31 am
stoptothink wrote: Thu Oct 14, 2021 2:56 pm

Why? Teaching certainly is not one of the higher-paying professions for college grads, but it tends to pay median income salaries and has many other benefits. For some it truly is "a calling", it definitely is for my step-father and maybe my sister as well (she's still early in her career). I guess this is common with people of all professionals, as we are seeing multiple MDs saying they tell their children not to get into medicine. As an exercise physiologist and health scientist, I guess I should council my children to study something else because the data suggests there is little opportunity, even though it has worked out quite well for me.
The amount of education required for keeping the degree/teaching license puts teachers at a huge disadvantage when it comes it comparable education and salary's. The amount of behavioral issues coming to schools and the fact that we do more and more and more for the community that looks at us a glorified baby sitters is frustrating on so many levels.
Pa no long as a guaranteed defined pension for new hires. Medical is not paid for by the district, and we have high deductibles. The one saving grace was the retirement and they took that away for new hires. We have had teachers quit mid year, because they are fed up and can make more outside of education.
We are seeing that very few college grads are going into education so there are no subs. This translates to no break because you need to cover other classes on a daily basis.
The buildings are outdated with very little ventilation, it was 87 in my room in August and the humidity was so bad no posters would stay on the walls. I could go on an on, I am teaching 22 years and every year more gets dumped on us from a local and state level.
In my previous position I lost a handful of employees who went into public school teaching. I can tell you that teaching requires less education/credentialing and pays better, with fewer workdays, than working in a lab as a chemist or biologist (I oversaw our labs as one component of my previous position). I don't really get the poo-pooing of teaching as a job, for an "average" college grad. My sister started at $43k/yr, finished an online masters in 9 months and got an immediate bump to $47k/yr, and has awesome benefits. Not bad for a 26yr old who was a very mediocre student, never did anything else but entry-level work, and (to be honest) isn't really cut out for a lot of other careers. My step-dad now makes ~$80k in the same district, and he actually quit (almost 20yrs ago) his marketing job to teach because it paid as well (he is not one with the drive to move up the ladder), but with better benefits and much better stability.

IMO, if you are an average student and not super driven, you can definitely do worse. Of course, none of us want to think our kids are just average.
Boy, that does not say much for the teaching profession, or at least your perception of it. Does not bode well for our future generations if these are the people that will be teaching our kids to fill those other professions you put more value to.

Our experience was different, we found our kid's teachers to be well educated, and definitely very driven to support our kid's education. But, our kids were in a public school systems that pays teachers quite well, maybe that explains some of the difference.
My sister teaches 6th grade, my step-father teaches freshman and sophomore English at the #2 ranked public school in the state. My step-father is fantastic at his job, having won multiple district teacher of the year awards. He also started and still coaches one of the top debate programs in the entire mountain west. Being a good teacher takes a unique skill-set, one that may not translate great to other occupations. I did undergrad at UCLA and went on to MS and PhDs at other top universities, my sister right behind me went to Brown (then Oxford and NYU), we had a ton of classmates go HYPMS and we never had a teacher in high school that went to a top school.

I don't have a low perception of teachers, I am realistic in that I don't expect our nation's top students to become public school teachers, nor do I think they would necessarily make the best teachers for our children. In fact, having taken classes from world-renowned professors myself, it is often the opposite.
Your current response paints a completely different picture than the post i responded to.

Saying it is a good occupation for mediocre students with no drive does not really square with you now saying you don't have a low perception of them.
Once in a while you get shown the light, in the strangest of places if you look at it right.
bubbly
Posts: 288
Joined: Tue Jun 16, 2015 4:21 pm

Re: Telling Kids about 529 plans

Post by bubbly »

Dennisl wrote: Fri Oct 15, 2021 12:41 pm Fear is a pretty powerful motivator. I lived my life afraid to fail. Still do. My parents had no means of helping me pay for college. Between scholarships, loans and 2 jobs, I made it work. College was pretty stressful, but it had it's fun moments. My kids won't be getting any need based aid. That's because of my income, and isn't a reflection of them. The university I attended now costs $71k a year. It's not realistic for me to ask them to cover a significant portion of that. I'll probably have him cover beer money and maybe books. I'll make my expectations clear. I'll pay for 4 years of college, unless there is an extenuating circumstance. They can major in what they want. See what college costs. See what jobs are available based on major and what the expected earnings are to be. Might help them out for a few months to get settled after college, but they're on their own after that. By that time, they'll have had a lifetime of privilege and advantages, whether that be in the form of sports, tutors, music lessons, etc. If they can't make it work on their own by that time, I would see it as a personal failure as well as be severely disappointed in my kid. There were rough stretches where I rationed out a pack of oreos and tap water to make it work or lived off canned vegetables. Not sure that's what I want for my kids to create that same hunger and mentality. I had too much pride to ask my parents or anyone for help because I knew that my folks were scraping by and didn't want them to feel bad about not being able to help out. I'm not sure of the mentality of the current upcoming generation. You can call them soft, but I'm a bit scarred from my experiences. Maybe there is a better way, hence I come to this forum to pick your brains and experiences.
Stories like this are inspirational but for me, it goes the other way.

Just a little bit of background, my father came from a poor farming background growing up in a communist country. Prior to 1977, there was no chance for a farmer to go to college and the ones that did go to college were generally well connected politically to the communist party. Everything changed in 1977 when sweeping reforms were enacted and an equal opportunity was afforded to anyone in the form of true college entrance exams. As you can probably guess, it was the most competitive time ever in the country’s history to get into college. The age ranged from high school grads to 60 year olds applying. He barely missed the cutoff and spent a whole year studying for a second chance and finally got in on that second attempt to a top9 university, the equivalent of an Ivy League here in the US. Even with that degree, it was not highly regarded when he immigrated to the US and he had to get a second phD from a top engineering school in the US in order to qualify for some of the better engineering jobs.

Fast forward to my college years and it was instilled in me from a young age that failure was simply not an option. They could not help me much financially but did everything they could to promote the importance of education: spending extra time with me on my schoolwork (my dad was great at calculus, a better teacher than my actual teachers and my mom had a great educational background up to algebra), extra prep materials for high school (I had to test into a competitive high school) and college exams. I ended up going to a top5 engineering school with significant loans and then as previously said, my grad school covered my tuition in the form of a teaching assistantship position.

As for my own child, my biggest fear is that with all of the advantages afford to him/her, he/she will simply squander it. With each passing generation, the bar for college admission gets lowered but I worry that if I simply agree to pay for their whole tuition, that bar will be too low, promoting complacency. I want them to do well but don’t want to handicap their potential by giving them a crutch to lean on. In addition, I also don’t want them to simply do well, I want them to do the best they can possibly do. In my mind it only makes sense given the struggles of my father and I, that if my child isn’t on the right academic track, then it is because the effort is lacking. They will have far better privileges and access than my father and I ever dreamed of.

Perhaps this is just the ramblings of an overbearing parent and there is a cultural barrier here so forgive me if I sound like a helicopter parent.
Last edited by bubbly on Fri Oct 15, 2021 4:41 pm, edited 1 time in total.
stoptothink
Posts: 15368
Joined: Fri Dec 31, 2010 8:53 am

Re: Telling Kids about 529 plans

Post by stoptothink »

marcopolo wrote: Fri Oct 15, 2021 4:34 pm
stoptothink wrote: Fri Oct 15, 2021 4:15 pm
marcopolo wrote: Fri Oct 15, 2021 3:49 pm
stoptothink wrote: Fri Oct 15, 2021 3:08 pm
forgeblast wrote: Fri Oct 15, 2021 11:31 am

The amount of education required for keeping the degree/teaching license puts teachers at a huge disadvantage when it comes it comparable education and salary's. The amount of behavioral issues coming to schools and the fact that we do more and more and more for the community that looks at us a glorified baby sitters is frustrating on so many levels.
Pa no long as a guaranteed defined pension for new hires. Medical is not paid for by the district, and we have high deductibles. The one saving grace was the retirement and they took that away for new hires. We have had teachers quit mid year, because they are fed up and can make more outside of education.
We are seeing that very few college grads are going into education so there are no subs. This translates to no break because you need to cover other classes on a daily basis.
The buildings are outdated with very little ventilation, it was 87 in my room in August and the humidity was so bad no posters would stay on the walls. I could go on an on, I am teaching 22 years and every year more gets dumped on us from a local and state level.
In my previous position I lost a handful of employees who went into public school teaching. I can tell you that teaching requires less education/credentialing and pays better, with fewer workdays, than working in a lab as a chemist or biologist (I oversaw our labs as one component of my previous position). I don't really get the poo-pooing of teaching as a job, for an "average" college grad. My sister started at $43k/yr, finished an online masters in 9 months and got an immediate bump to $47k/yr, and has awesome benefits. Not bad for a 26yr old who was a very mediocre student, never did anything else but entry-level work, and (to be honest) isn't really cut out for a lot of other careers. My step-dad now makes ~$80k in the same district, and he actually quit (almost 20yrs ago) his marketing job to teach because it paid as well (he is not one with the drive to move up the ladder), but with better benefits and much better stability.

IMO, if you are an average student and not super driven, you can definitely do worse. Of course, none of us want to think our kids are just average.
Boy, that does not say much for the teaching profession, or at least your perception of it. Does not bode well for our future generations if these are the people that will be teaching our kids to fill those other professions you put more value to.

Our experience was different, we found our kid's teachers to be well educated, and definitely very driven to support our kid's education. But, our kids were in a public school systems that pays teachers quite well, maybe that explains some of the difference.
My sister teaches 6th grade, my step-father teaches freshman and sophomore English at the #2 ranked public school in the state. My step-father is fantastic at his job, having won multiple district teacher of the year awards. He also started and still coaches one of the top debate programs in the entire mountain west. Being a good teacher takes a unique skill-set, one that may not translate great to other occupations. I did undergrad at UCLA and went on to MS and PhDs at other top universities, my sister right behind me went to Brown (then Oxford and NYU), we had a ton of classmates go HYPMS and we never had a teacher in high school that went to a top school.

I don't have a low perception of teachers, I am realistic in that I don't expect our nation's top students to become public school teachers, nor do I think they would necessarily make the best teachers for our children. In fact, having taken classes from world-renowned professors myself, it is often the opposite.
Your current response paints a completely different picture than the post i responded to.

Saying it is a good occupation for mediocre students with no drive does not really square with you now saying you don't have a low perception of them.
You can read into it what you want and are free to decide your own definition of "average" and "mediocre". The best teachers do not necessarily go to top schools nor do they have the drive/personality to climb a corporate ladder.
Flyer24
Posts: 5233
Joined: Sun Apr 08, 2018 4:21 pm

Re: Telling Kids about 529 plans

Post by Flyer24 »

Thread has derailed about teachers. Stay on topic please.
MrBeaver
Posts: 491
Joined: Tue Nov 14, 2017 3:45 pm

Re: Telling Kids about 529 plans

Post by MrBeaver »

Agree that waiting until high school is the right timing. Early on with money, it’s more important to show generosity, openness about talking about money, budgeting, and a healthy view of the work/money/time relationship.

Once you get to the right time though, consider using it as an opportunity to show them how achieving scholarships, choosing a more cost efficient school, or working in high school or college to defray the cost could allow them to accomplish longer term goals:
  • Stretch funds to pay for grad school
  • Leave some unspent to fund their kids education also
Use it as an opportunity to explain compound growth. Assuming they have kids around 30 years old, just 20k left in a 429 (transferred to them) would grow to 100k in inflation adjusted dollars (assuming 5.5% return after inflation) over that time period.

I stretched mine this way by getting a small scholarship starting in my second year making my tuition in-state, and then applying for residency after I had worked for one year in the new state. That saved me $30k in tuition over three years. The extra proceeds were in a UTMA account, so I used it to max my Roth IRA when my income was very low.
bikechuck
Posts: 1474
Joined: Sun Aug 16, 2015 9:22 pm

Re: Telling Kids about 529 plans

Post by bikechuck »

bubbly wrote: Wed Oct 13, 2021 10:14 am Friend of mine had their parents give them a gpa requirement for college. Basically, above a 3.0 gpa, the parents would cover that semester of school. I believe he was informed of it during the initial stages of the college application process, so around junior year or so?
That works for some but not all kids. I had two daughters, one with a learning disability, both worked hard. One got excellent grades and eventually went on to a fully funded PhD program. The other struggled. graduated with lower grades and eventually went on to a partially funded Master's program. It would not have been fair to penalize my daughter with the learning disability and to tie my financial support to a particular gpa.
bubbly
Posts: 288
Joined: Tue Jun 16, 2015 4:21 pm

Re: Telling Kids about 529 plans

Post by bubbly »

bikechuck wrote: Fri Oct 15, 2021 5:30 pm
bubbly wrote: Wed Oct 13, 2021 10:14 am Friend of mine had their parents give them a gpa requirement for college. Basically, above a 3.0 gpa, the parents would cover that semester of school. I believe he was informed of it during the initial stages of the college application process, so around junior year or so?
That works for some but not all kids. I had two daughters, one with a learning disability, both worked hard. One got excellent grades and eventually went on to a fully funded PhD program. The other struggled. graduated with lower grades and eventually went on to a partially funded Master's program. It would not have been fair to penalize my daughter with the learning disability and to tie my financial support to a particular gpa.
I addressed the issue of a learning disability in a later post. I also would not tie a gpa requirement in that scenario either.
User avatar
Nords
Posts: 293
Joined: Sun May 20, 2007 9:55 pm
Location: Oahu
Contact:

Re: Telling Kids about 529 plans

Post by Nords »

Soon2BXProgrammer wrote: Wed Oct 13, 2021 10:07 am this is a pretty good book.
https://www.amazon.com/Raising-Money-Sa ... UTF8&psc=1
It is written by "Nords" ( https://the-military-guide.com/ ) and his daughter.
Thanks, Soon2BXP! We had a good time writing it, and it's been well received.

For those who are interested, it's in public libraries (and military base libraries) in all formats.
* | * | Please see my profile for my next book. I don't read every post, so please PM or e-mail me to get my attention.
Post Reply