Saving for college

[JWIL4CY]

I was lucky to get some munchies sent back to school with me from my parents.

$250K would have made college life (& post-college life) MUCH more enjoyable. Just make sure they know how nice they have it when they get older.

My parents gave me a full ride to ISU which I am very thankful for. That is why I'd like to return the favor to my kids.

[Stewo]

Make them join the military. You win.

[ianoconnor]

Wow, that is insane.

[azepp]

How do you get $250k for 4 years of Tuition + R&B??

Even if it increases $400 a year for the next 18 years from current cost, it'd be $25,720/year.

$400 increase is less than 2.5% inflation this year (and even lower % as the cost grows, which is why you can't do it that way).

Tuition + books + room & board @ ISU is $16,490 per the earlier link for the 2012-13 school year.

4% inflation (conservative, given recent trends) puts the cost for the older child at ~130k. 6.5% for the same child puts it closer to $200k. It's all about which assumptions you use.

[kcclones]

I children under 1 year and was told to plan on at least 200k. i don't recall the % increase that was assumed, but over the past 30 years the increase has always been on par with the assumption

[ISUME]

Start teaching them to golf if they are girls or throw left handed junk if they are boys.

You play with any ISU female golfers lately?

[farminclone]

How do you get $250k for 4 years of Tuition + R&B??

Even if it increases $400 a year for the next 18 years from current cost, it'd be $25,720/year.

Your % increase isn't exponential. The increases in tuition have been exponential, meaning they go up 8% per year continually, building on the already increased 8%.

So to figure the cost of 1 year of college you would use an exponential function. y=a(1+b)^x where y is the cost of 1 year of college when your kids go to college, a is the cost right now for 1 year of college, b is the percentage increase per year, and x is the number of years.

So, y=$15,000(1+.08)^18 = $59,940 per year x 4 years = $239,761 for a total tuition cost.

It is going to be crazy if the 8% increase actually keeps up, hopefully someone finds a solution to the problem.

[azepp]

Well my goal is to do 100% tuition/room/board for an in-state school for 4 years. Considering my wife would like 4 kids that would mean I'd have to save about a million. Yeah that ain't happening.

The easiest variable to control in this equation is the one highlighted.

[JWIL4CY]

The easiest variable to control in this equation is the one highlighted.

Unfortunately, I don't feel like that one is too much under my control, haha.

[Rabbuk]

Marry a woman that is smart, be smart. Full ride.

[JWIL4CY]

Your % increase isn't exponential. The increases in tuition have been exponential, meaning they go up 8% per year continually, building on the already increased 8%.

So to figure the cost of 1 year of college you would use an exponential function. y=a(1+b)^x where y is the cost of 1 year of college when your kids go to college, a is the cost right now for 1 year of college, b is the percentage increase per year, and x is the number of years.

So, y=$15,000(1+.08)^18 = $59,940 per year x 4 years = $239,761 for a total tuition cost.

It is going to be crazy if the 8% increase actually keeps up, hopefully someone finds a solution to the problem.

Something definitley has to change. That doesn't even take into account an out of state or private school, or going more than 4 years. I can't imagine too many kids would choose a college degree + 200k of debt at that point.

[farminclone]

Something definitley has to change. That doesn't even take into account an out of state or private school, or going more than 4 years. I can't imagine too many kids would choose a college degree + 200k of debt at that point.

It will eventually get to the point where no one will be able to afford to go. Like you talked about, not many people have $1 mil to drop on kids' education.

[oldman]

My daughter started this year at ISU. We were told to figure just over $18,000 for one year, including R & B.

[aeroclone]

It will eventually get to the point where no one will be able to afford to go. Like you talked about, not many people have $1 mil to drop on kids' education.

Yeah, at some point market forces have to bring this back under control. It seems that tuition prices are rising far faster than salaries. The cost of college has always been a good investment because you make it back ten times over in improved earnings. As the tuition costs keep gaining ground on earnings, college becomes a good choice for fewer and fewer students, and I don't think schools can deal with dramatic decreases in enrollment.

[brianhos]

College expenses cannot continue to climb at the rate they currently are. At some point it will become too expensive to go.