Jul 8, 2023

Paying for College: Make a Four-Year Plan (at least!)

Since my oldest is heading off to college next month, I've been deep in the weeds of figuring out how we're going to pay for it. And one thing I've come to understand is how important it is to plan not just for this first year, but for every year that he's in college. On his college's parent Facebook page, I've been seeing posts from parents who are confused, so I thought a post about this topic would be timely.

Here are some things to think about when planning out how you'll pay for college:

- What is the actual cost of attendance?

Every college will list an estimated cost of attendance (COA) on its website, but now that your child has selected a school, you'll want to figure out what your actual cost will be. That estimated COA should be accurate as to tuition and room and board, but the estimate will probably be off for costs like transportation. If you live far away, you can expect to pay more; if you live close by, your cost may be less. Other costs to evaluate include loan fees (I see a lot of schools including this in their estimate and they may not apply to you if you're not taking out loans); health insurance (many schools automatically bill for this but you can get a waiver if your child continues to be covered by your family policy); and lab fees (you may be paying a lot of these if your child takes a STEM-heavy course load).

It may be difficult to figure out the final, actual cost of attendance at this point of the summer, but just know that the estimated COA on the college's website is not the exact amount you'll be paying.

- How long will your child be in school, and what will the total cost be?

Sometimes students can't graduate in four years and need an extra year. Hopefully my son will graduate in four years, but he'll have the option of staying a fifth year to get a master's degree. Graduate school, possibly in the form of law school, is also an option he's considering. These are factors to consider when planning out payments. With graduate school on the horizon, there's no pressure to spend out the college savings accounts. A friend's son changed his major after two years, so he spent a fifth year in college to get his degree.

It's important to remember that each year, the COA will go up. It goes up more at some schools than others - my son's college's COA went up about 5% this past year, while the COA at a friend's son's college went up less than 3%. So when projecting the total cost, you'll need to factor in year-over-year increases.

- What are your sources of funding?

College savings accounts like 529s and even "regular" savings accounts are obvious funds to tap to pay for college. So is your current income, which I'll refer to as cash flow.

But other sources of funding include Roth IRAs (earnings can be withdrawn without penalty to pay for qualified education expenses), U.S. Savings Bonds (if you qualify, you don't have to pay taxes on the interest), home equity, and other loans. As one personal example, we re-financed our mortgage a couple of years ago to lower our monthly payment and free up cash we could put toward college instead.

Keep in mind that you should always consider the pros and cons of using various funds to pay for college, especially the long-term consequences, such as the risk of losing your house if you fail to make home equity loan payments.

- Are there benefits to paying out of pocket?

Even if you have the savings to pay for a full year or a full four years of college in a tax-advantaged account like a 529, there may be reasons to pay at least some of the expenses out of "regular" savings or cash flow (i.e., out of pocket). The most common reason is likely to be the American Opportunity Tax Credit (AOTC), as long you qualify. I'm finding that things get tricky here: for AOTC purposes, qualified expenses are tuition, fees, books, supplies, and necessary equipment. Expenses don't include room and board, which are qualified expenses for other purposes like 529 accounts. For the maximum AOTC credit, you'll need to pay $4,000 out of pocket.

- Which savings should you use first?

You'll want to think about which accounts you want to empty out first. If you have younger children, any accounts that can't be redirected to them should probably be used first in case you're lucky enough to have money left over. In our case, our children have custodial 529 accounts whose funds can only be used by them, so we'll use those up before we tap 529 accounts.

If you have a Coverdell education savings account, you might want to use that up first because those funds have to be distributed when the beneficiary turns 30, unless the funds are transferred to a qualifying family member. (There are no such age restrictions on 529 funds.) 

If you have a college savings account and a Roth IRA, you'll probably want to use the college savings before tapping into retirement funds.

- Should you take out loans?

When deciding whether to take out loans to pay for college, always keep your eye on the total amount borrowed. A student who takes out the maximum federal loan each year (discussed below) will graduate with $27,000 in debt - that's a $293 monthly payment for 10 years at the 5.5% current interest rate. A parent who borrows $20,000 per year will have $80,000 in debt at the end of four years - that's a monthly payment of $973 for 10 years at the current 8.05% PLUS loan rate. You'll want to make sure any monthly payment is manageable before committing to loans.

Moreover, you might be able to pay for the current year of college, but what about later years? If you're likely to need loans to pay for future years, it might make sense for your student to take out the federal loan available to your student this year, because the loan won't be available in the future. 

To make sense of this, you should know that every student who files the FAFSA is eligible to take out a federal Direct Loan. Depending on your financial aid eligibility, the loan may be partly subsidized (meaning the loan does not accrue interest while the student is in school). The loan amounts vary by year: 

  • First Year - $5,500
  • Second Year - $6,500
  • Third Year and Beyond - $7,500
If a student opts not to take the $5,500 loan their first year, they can only take out $6,500 the next year (not $5,500 + $6,500 = $12,000). These federal loans are almost always the lowest-interest loans available, so it probably makes sense to take out the federal loan in the first year at that low rate (even if you have to pay the interest on the full amount), rather than take out $5,500 at a significantly higher rate in a later year.

There are loans available to parents, such as the federal Direct PLUS loan, and private loans (which will have the highest interest rates, and if you go this route, you'll definitely want to shop around for the lowest rate). Some families take out home equity loans or utilize a home equity line of credit, especially during times of low interest rates; just remember that you're borrowing against your home when you do this.

Another thing to keep in mind before you borrow is that the money needs to be repaid even if your student does not graduate, so if you're uncertain that your student will stick with college, it could make a lot of sense to make sure the school is affordable without loans.

- Do you have younger children who will also be attending college?

This question is especially important if you'll have multiple children in college at the same time, because unless you're paying for college entirely out of savings, your cash flow will be impacted when you have to pay for more than one student. You might decide to pay more out of pocket now and save the money in the college savings accounts for the overlapping years. Or you might realize you need to take out loans.

In fact, this question ties in closely with the previous question about loans because as a parent, you're probably not going to want to take out $20,000 per year for one child and then add on another $20,000 loan per year for another child. While this is a question that would hopefully be addressed before your child commits to a college that requires you all to take out significant loans, if you find yourself heading down this path, it's a good idea for a full stop and re-evaluation of your family's financial circumstances. Your options include contacting the college's financial aid office to see if they provide additional information, ideas or funding; taking a second job; having your student(s) work while attending school; or even having your child attend a different, cheaper college.

- Should you sign up for the college's payment plan?

Every school should have a payment plan to help you cash-flow your way through the payments.  The plan will allow you to make monthly (or at least some form of installment) payments instead of paying the full cost at the beginning of the term, and you can decide how much you want to pay monthly. For example, you might pay $10,000 before the semester starts, and then use a payment plan for the remaining balance. These plans are particularly helpful if you plan to cash-flow payments, but even if you're using savings, you can keep earning interest/income. There's often (but not always) a fee involved, and the amount varies by plan. Information about payment plans should be readily available on the college's financial services page.


What works for one person doesn't necessarily work for another, but in my case, I started by creating a spreadsheet. I estimated the COA for future years at about a 7% increase per year, to be conservative. Then, for each year, I plugged in how much money we would use from each account to pay for college. Our kids have several different college savings accounts, so I figured out the order in which I wanted to use up the money, and estimated a very conservative growth amount for future years (since the investments are age-based, they are all conservatively invested, which protects the capital but minimizes growth). I also calculated how much we would be cash-flowing each term.

I'll be honest, it's a sobering exercise. But it gives me the peace of mind of knowing how we'll pay for four years of college, and especially, that we can do it. I don't have to worry that three years from now, I'll be pulling out my hair wondering where we'll find the money not just for my son's last year of college, but also his brother's second year.

I know this was a loooong post, but I hope it was helpful. If there's something you'd like me to discuss further, please let me know!

Jun 3, 2023

I'm back! Updates, Favorites, and a new Freebie!

 Well, hello there! If you've been a long time CFO follower, thank you for still being here. It's been over a year since I last wrote, but would you believe this little old blog is now 18 years old??? It all started back in 2005, when I was on maternity leave with my oldest. He's graduating from high school in just a few days and will be attending college in the fall. Where has the time gone?!

That brings to mind my favorite quote by Gretchen Rubin, "The days are long but the years are short." Those words have always resonated with me as a parent, and no more than now, when life is about to change so much!

In the last year, I've walked with my son though the college application process (actually, he mostly ignored me until the very end, at which point it was nice to be needed). I watched as he and his peers got their acceptances, rejections, and in-betweens (aka the waitlist). We went to one accepted student day and were blown away. That is where he will be attending, and we're all quite thrilled, which is a wonderful place to be. The school is going to be a fantastic experience for my son and affordable for our family, so deposits have been paid, email is being monitored (so important and not something high school seniors are used to doing), hotel reservations for parents weekend have been made, etc.

Unfortunately, there are students who didn't get into any schools that satisfy them. Or their families can't afford the school they got into and want to attend. This upsets me so much that I will be getting certified as a college counselor by the end of the year. I still have to figure what life will look like beyond that. Do I want to be an independent counselor (aka, an IEC or independent college counselor) - working alone or for an already-established company? Do I want to work at a school? I can't work at a local public (LAUSD) school because they require all counselors to have a teaching credential (though not any counseling experience, which makes me want to bang my head against a wall), but I could work at a private or charter school. There are also some nonprofits that hire college counselors, or I could simply volunteer to help students somewhere. I have some time, but I do think college counseling is in my future in some way.

Where does that leave CFO? I'm not sure, but I've missed this. I've missed you, our shared conversations and especially the helpful tips that go back and forth.

So I plan on resurrecting CFO, although I won't commit to a posting schedule. And a lot of the upcoming content is going to center around our kitchen remodel. As soon as my son heads off to college, we're going to start a full remodel of our galley kitchen. We're talking new floors, new cabinets, new appliances. I'm even switching from a gas stove to induction. It's going to cost a lot because we are not DIYers. I'm already stressed about it and I haven't even officially hired a contractor yet! I'm open to any and all tips you want to share with me.

As for my younger son, he's wrapping up his sophomore year and I am focusing on his college application readiness. I'm hoping to be able to take him to look at some colleges this summer, but we'll just have to see how things shake out.

In the meantime, let me share some of my favorite things lately:

  • Fresh Hawaiian lychee from Hula Brothers - this was my Mother's Day gift from my husband and sooo much better than flowers! A 10-pound box of just-picked lychee from the Big Island, which took me only three days to eat (I shared some with my son, who's the only one who likes lychee besides me, but I ate most of it and I could easily have eaten more!). It's not cheap, but this is what I want for Mother's Day every year. 😂
  • Cozy mysteries by Rita Mae Brown - I started with the Mrs. Murphy series, and am now reading the Sister Jane series (all of these links are Amazon Affiliate links, meaning I get a small percentage of the sale price at no additional cost to you if you make a purchase using them - thank you!). I barely knew the term foxhunting before reading these books, and now I'm actually looking up riding lessons near me and hunts in California to see if there's any within driving distance that would let me join their hill toppers (the slower group geared toward beginners). I'm also getting more desperate for a dog, which I was already thinking about for when my kid(s) head off to college.
  • Formula 1 racing - Netflix's Drive to Survive docuseries about F1 racing was something my husband and I both enjoyed watching. They seem to have changed the format this last season so we didn't get through more than a couple of episodes, but our love for the sport itself continues and we watch it every weekend there's a race. It's one of the reasons we maintain our ESPN+ subscription (others being University of Hawaii sports, tennis, and European soccer).
  • Gymnast Ian Gunther's TikTok - I've laughed so hard at so many of these videos, which is crazy because they're doing extremely difficult things. But they make it look so funny and they seem to have a good time doing it.
  • Gotham Greens Green Goddess Dressing (also an Amazon Affiliate link, because I buy it at Whole Foods) - I've been eating a lot more salad, and my younger son actually eats them too. This is by far our favorite dressing. I've tried other brands, and I've tried making my own, and nothing's good as this. It's quite natural, which means it expires quickly, which isn't a problem if you just keep eating salad. (It would also make a good dip for crudite.)
Finally, I want to offer up a freebie: the 2020 edition of my book, LAUSD Magnets Handbook: A Guide to Getting Your Child into an LAUSD Magnet School. I know it's not relevant to everyone, but I've never offered this for free before and it's a project that's near and dear to my heart because I had to work hard to gather all of the information in it. 2020 was the last time I updated this book, which until now has only been available at Amazon (another affiliate link). I plan to update the book for fall 2023, but in the meantime, the information in the 2020 edition remains fundamentally sound (most especially the strategies for getting your child into the magnet school of your choice). To download the book (via Google Drive), click here.

Thank you again for still being here, and let me know how you're doing!

May 9, 2022

Easy Faux Boston Cream Pie (including a Ganache Recipe)

This post contains affiliate links that help support this site at no additional cost to you. Thank you for using them! You can read CFO's full disclosure here.

I wanted an easy dessert to take to dinner at my in-laws' house for Mother's Day yesterday, and I spotted Ina Garten's Boston Cream Pie recipe on my Pinterest Desserts board. But I didn't feel like making pastry cream or even a new cake recipe, so I improvised an easier pseudo-Boston Cream Pie.

I started with my favorite yellow cake recipe from Michelle Lopez's excellent book, Weeknight Baking, which I baked in two 8-inch round cake pans.

I whipped up a package of organic Vanilla Instant Pudding using whole milk to use as the cake filling. It's nowhere near as pretty as a good pastry cream, and actually not as delicious either. But it's still pretty darn good. 

And then I made the chocolate ganache (recipe below). Nothing was difficult, and you could even use a yellow cake mix if you didn't want to make a cake from scratch. The hardest part was the assembly, and that was mostly because I didn't let the ganache cool quite enough so it was a little too thin when I poured it on. (My kitchen was pretty warm, so trust your senses rather than the time.)

Here's a step-by-step process for clarity:

Easy Faux Boston Cream Pie
Serves 8-12

1. Make your favorite yellow cake in two 8 or 9-inch round cake pans. Bake according to directions and let cool completely.

2. Make a package of instant vanilla pudding. Use whole milk for the best consistency and let chill for at least one hour.

3. Make a simple syrup: In a small saucepan, combine 1/4 cup granulated sugar and 1/4 cup cold water. Bring to a boil, and stir until the sugar is dissolved. Simmer on very low heat for 15 minutes to reduce the amount of liquid. Let cool. (Note: Simple syrup is just a 1:1 ratio of sugar and water, so you could easily make more and save the extra to sweeten iced tea or coffee.)

4. Approximately two hours before serving time, make the ganache (recipe follows). Let cool for 20-40 minutes, until the mixture is slightly thickened and falls in ribbons.

5. To assemble the cake, use a long serrated knife to split each cake round in two to create four layers. Place one cake layer on a cake stand or serving platter, cut side up. Use a pastry brush to lightly coat the cake with simple syrup. Spread one-third of the vanilla pudding over the cake. Repeat with two additional cake layers. Place the final cake layer on top of the last layer of vanilla pudding cut side down. Slowly pour the ganache over the cake, allowing the chocolate to drip down the sides. If you made an 8-inch cake, you will have enough ganache to fully cover the sides if you wish (though you might need to use an offset spatula to push the ganache off the top in some directions). Let the chocolate set at room temperature for an hour before serving. 

Store leftovers in the fridge. Since my cake stand didn't come with a cover, I use a large mixing bowl turned upside down to cover my cakes. (Plastic wrap would stick to the chocolate and ruin the look but would work also.)

Chocolate Ganache
Makes enough to cover one 8 or 9-inch layer cake
Adapted from Ina Garten's Boston Cream Pie recipe

3/4 cup heavy cream
7 1/2 ounces semisweet chocolate*
2 ounces bittersweet chocolate*
2 tablespoons of corn syrup
1 teaspoon vanilla extract
1/8 teaspoon kosher salt
1/4 to 1/2 teaspoon instant coffee granules optional**

Combine all ingredients in a double boiler, or a medium heatproof bowl set over a small pot of simmering water. Once the chocolate starts to melt, stir until the chocolate is half-melted. Remove the bowl from heat and stir until all of the chocolate is melted and the ingredients have combined into a smooth mixture. Set aside and stir occasionally until it cools enough to thicken slightly and falls in ribbons.

*I really like Guittard chocolate. I always have their chips and wafers on hand - they are high-quality and free from peanuts, tree nuts, and gluten. Best of all, their chocolate is fair-trade certified, which is no small thing - according to the U.S. government, over 1.5 million children work in dangerous conditions on cocoa farms in Côte d’Ivoire and Ghana. And Guittard chips are widely available, including at Target!

**If you don't want to taste any coffee in the ganache, use a scant 1/4 teaspoon. Use the full 1/2 teaspoon if you don't mind a hint of coffee.

Apr 6, 2022

Book Review: The Price You Pay for College by Ron Lieber

This post contains affiliate links. Read our disclosure policy here.

I just listened to Ron Lieber's book, The Price You Pay for College: An Entirely New Road Map for the Biggest Financial Decision Your Family Will Ever Make. It's a great book, and one that every parent who wants their kid to go to college should read. I wish it had been around when my kids were little, or at least when they were in middle school. But even now, with as much as I've learned over the last five or so years, I picked up useful information that I'll be implementing immediately.

The book covers a lot of ground in five sections:

  • Part I: The Price and Cost of College and the Systems Behind It - This includes discussion about why college costs so much, an explanation about the FAFSA and EFC, and different kinds of financial aid.
  • Part II: The Unhelpful Feelings You May Feel - The feelings are fear, guilt, and "the pull of snobbery and elitism." 
  • Part III: Value - I loved this section, because it asks what is worth paying for, which will differ by family and student. Some families might find it worth paying for a women's college. Others might want to pay for small class sizes at liberal arts colleges. Still others might shell out for robust mental health programs, and so on. The chapters on different considerations contain questions to ask so you can get deeper than the college's public relations message.
  • Part IV: Money-Saving Hacks That Will Tempt You - The "hacks" include community college, honors colleges, college abroad, gap years, and athletic scholarships. I appreciated the hard truths in this section, such as the rarity of getting an athletic scholarship (particularly at one's first choice school), and the importance of immediately identifying one's desired four-year institution upon starting community college in order to be able to transfer in two years (you have to jump through the right hoops). I was pleasantly surprised by the data about gap years. The information in this section is all couched in terms of financial value, which is a different perspective than you'll find elsewhere.
  • Part V: The Plans - The plans include a "big financial plan," talking with your child about money for college, and "shopping" for college. There is also information on college savings plans, when and how to find professional help, appealing financial aid awards, and the basics of student loans. The chapter on "shopping" for college has some very practical tips that I hadn't come across anywhere else, which is saying something.
There is so much information in this book that after listening to it, I got the written version so I could easily make notes on the ideas I wanted to make sure I keep in mind. I especially wanted to get down the questions to ask of colleges to find out where they stand on the considerations that are important to my children and our family, and of course, the "shopping tips," including how to find merit aid data.

Because the focus is on paying for, rather than getting into, college, the book doesn't get into the nitty gritty of the application process. But it does cover a lot of the initial phases of the process, particularly list-building. (In college application parlance, "the list" is the list of colleges a student will be applying to.) For most families, I think this is one of, if not the most, difficult parts of the process because it's just hard to know where to start.

I had listened to a podcast about this book before I listened to the book itself, and there had been a mention that the book includes tips for talking with grandparents about whether they plan to help pay for college. I couldn't help but start at that chapter (Chapter 28, in case you're like me), but it turned out that the conversation was aimed primarily at parents of young children who were just starting out the college savings process. Which made me think at first that the book is aimed at new parents, but it's really not. 

Chapter 28 and Chapter 30 (which is all about 529 plans) are definitely relevant to parents with very young children. But the rest of the book is more useful to parents of middle schoolers and up, especially if money is an issue. Even if money isn't a factor, however, the book would be helpful in identifying schools that are a good fit for a student.

Verdict: I am adding this book to my list of must-reads for parents planning to send their children to college.

Mar 26, 2022

Recipe Roundup: Fish Tacos, 2 Cakes, 3 Dips

It's been a while since I've posted, and even longer since I shared a recipe roundup. So here are some recipes I've made recently that I would make again. Let me know what you've made recently that I should try!

Fish Tacos - Fish tacos often seem to feature breaded fried fish, so I loved that in this recipe, the fish was marinated and then seared. I was surprised at how much my husband liked the fish, and I loved the red cabbage slaw that goes with it. I'm definitely making this again, especially because it worked great with frozen defrosted tilapia.

Chocolate Stout Cake with Irish Cream Frosting - I've been a Patreon supporter of Hummingbird High for a couple of years now, and it gives me access to exclusive monthly recipes. I made this one for St. Patrick's Day, and it was a hit with my family. I think I overbaked the cake a little because it was a bit dry, and I discovered that I don't love Irish cream. So in a way, it was the perfect cake for me - my family ate it all, and I wasn't tempted!

Pineapple Upside-Down Cake - As classic as this dessert is, I'd never made one before. RecipeTin Eats is one of my go-to sites, and as usual, her recipe was a hit. I loved this cake - it's not one-bowl easy, but there's nothing difficult about it. I did have to get a 9-inch cake pan* because I only had 8-inch pans, but that worked out because I used the 9-inch pan for the Chocolate Stout Cake too. Usually, I only love cake with chocolate, but I will definitely make this one again. (*This is an Amazon affiliate link so I'll earn a small commission if you order anything using it - thank you! Read my disclosure policy here.)

Cannoli Dip - I think this is one of those recipes that's more fun in theory than practice. It tasted good, but you can only eat a little bit. So maybe what I really mean is that this recipe is for a party, not a small family. Even though the leftovers last a while, we didn't finish them. But I could see this dip being a hit at parties, with cookies and even fresh fruit.

Buffalo Chicken Dip - This dip was, not surprisingly, on the spicy side. The teenager who loves spice liked it. The teenager who doesn't like spice hardly touched it. I froze the leftovers and gave the container to my in-laws, and my father-in-law loved it.

Spinach and Shrimp Dip - Recipes from TikTok usually aren't easy to follow, unless there's a link to a full recipe or it's written down in the comments. So I used this video as more of a guide (e.g., I cut the shrimp into bite-size pieces instead of putting them down whole). But it was quite tasty, and I would make it again - it's great as an appetizer or a main dish.

Nov 19, 2021

THANK YOU for reading CFO! (What are you cooking for Thanksgiving 2021?)

I know Thanksgiving isn't until next week, but I love cooking for Thanksgiving, and usually I've planned my menu by early November. For some reason, this year, I haven't been able to get into it until now, but I've finally figured out what I'll be making. 

As always, we'll be eating our main Thanksgiving feast at a relative's house so I don't have to cook a turkey. Since we don't get leftovers, for the last few years, I've made a turkey just for our family anyway. But if I'm being honest, no one in my family actually loves turkey - so I'm going to skip it this year, and make a beef tenderloin or ham instead. 

I will, however, be cooking up a storm for the big day. Since we don't come home with leftovers, I like to prepare all the sides because we do enjoy those - and it doesn't really feel like Thanksgiving without them on Friday and Saturday. Here's what I'm thinking: 

Streuseled Sweet Potato Casserole - I've been making this every Thanksgiving for 20 years. I'll be doubling the recipe, because we'll take one to the family dinner and keep one for ourselves.

Zucchini, Rice and Cheese Gratin - I've recently gone gluten-free on my doctor's orders (a "let's see if it makes a difference" kind of thing), so I can't be eating traditional stuffing this year. I'm thinking this casserole will be a satisfying substitution. (But I'll probably pick up a package of traditional stuffing for the rest of the family, and maybe make some chicken gravy to go with it. Or maybe I'll give traditional stuffing a try with gluten-free bread - Breadblok is always at the farmer's market, and my friend says their bread is pretty good.)

Aunty Toki's Cranberry Sauce - I promised to share the recipe last year, but never did. Instead, I just posted a photo of it on the CFO Facebook page. Not surprisingly, I didn't follow the recipe exactly, so I shared the changes I made to create the best cranberry sauce I've ever had.

Pumpkin Flan - Over the last few years, I've really come to love flan, and this will be a perfect Thanksgiving dessert.

Spinach Artichoke Dip - I've been asked to bring this to the family dinner also, and this is my go-to recipe.

I might also make some Instant Pot Mashed Potatoes, mostly so I can use the leftovers to make cheesy Mashed Potato Puffs.

And of course, I'll make some green vegetables, probably some roasted Brussels sprouts and maybe some roasted carrots.

What's on your Thanksgiving menu? Anything I should add to mine?

Most of all, I want to say THANK YOU to YOU because you are what keeps this site going. THANK YOU for being a CFO reader!

Oct 29, 2021

Why We'll Pay for Our Kids' College Education + Tips for Paying for College Without Loans

My oldest child is now a junior in high school, so many of my friends also have juniors and seniors. Not surprisingly, a common topic of conversation is college. What does it take to get in, but especially, how are we going to pay for college?

Most of my friends seem to feel the same way I do: we'll pay as much as we can afford for college, but we don't want to take out loans, and we'd prefer that our children not take out loans either.

Some friends have saved some money in a 529 account, and don't intend to contribute any more toward their kids' college expenses. A few of my friends take a more hardline approach and have told their children that they won't pay for college at all. 

From talking to my friends and researching the subject, there are a lot of reasons why parents don't contribute, or contribute more, to their kids' college education. Among the most common reasons are: 
  • Not being able to afford it (and not wanting to take out loans themselves)
  • Feeling that graduation from high school is the demarcation for adulthood (therefore, college expenses are the student's responsibility)
  • Believing that kids need to have "skin in the game" - i.e., if they don't bear the financial responsibility of college, they won't take it seriously and will waste their time there
I think how a person grew up has to do a lot to do with how they view paying for college. Talking with other parents, it seems like those who had to pay their own way through college or couldn't afford to go (or didn't view it as an option for themselves) are more likely to think their children should at least contribute to their college expenses. Although there are parents who paid their own way who are happy to be able to pay for their children's education, because they remember how hard it was for themselves.

In my own family, my husband and I were both fortunate enough to have parents who paid in full for both of our college educations, and that's a big part of why we want to do the same for our own children. We know what a gift it is to be able to go to college and not have to worry about where the next tuition payment is coming from, and to graduate without any debt. We also know what carrying student debt feels like, because I took out loans to pay for law school.

We also remember how immature we were when we graduated from high school, and how college was an integral part of our maturation. Because of our own experiences, we really want our kids to have the opportunity to go away and live in a dorm their freshman year. 

Paying for college is obviously difficult, so we've been planning for many years now. We even refinanced our mortgage recently to bolster our cash flow. Nevertheless, we haven't saved up enough to pay for any college our kids might want to go to. So finances have been a part of the college conversation in our house from the beginning.

That's really important, because the last thing any parent wants is to never talk about money but then break their child's heart in April of senior year and say, "I know you worked really hard to get into College X but you can't go because we can't afford it." The better way to do things is to talk about cost before the student even starts putting together the list of schools where they'll apply. And then incorporate cost into the application process, so that the student isn't applying only to schools that are academic and social fits, but also a financial fit.

There's no way to know for sure if a school is a financial fit before you receive the financial aid package, but there are ways to roughly predict if a school will be affordable. Here are my best tips:
  • Start by assessing your finances. You can't know if a school is affordable if you don't know how much you can pay.
  • Determine your family's EFC, or Expected Family Contribution (soon to become the Student Aid Index in 2024). Read this discussion about EFC first so you don't go into shock when you do this.
  • Understand the different types of financial aid - schools may offer need-based financial aid and/or merit-based financial aid. There's more information in this post about paying for college.
  • Run a college's Net Price Calculator (NPC). Every college is required to have one on their website, so a search for the school name and "NPC" or "net price calculator" should take you to that page. Unfortunately, not all NPCs are built the same. In general, the more information the NPC asks for, the more reliable the result. Note that most NPCs don't seem to include merit scholarship information, so you'll have to dig deeper for those.
  • Create an account at TuitionFit. This is a new site and should become more reliable as more people use it. The site collects information from financial aid offers, so you can enter a student's stats and get information on the offers received by students with similar stats. The last time I checked, there was a free version and a premium paid version, but that was about a year ago when it first came out.
There are also paid services like Road2College's College Insights, which purport to show you which schools offer the best financial aid packages. I've followed the site's founder, Debbie Schwartz, for years, but I can't endorse the service since I've never actually used it (although I'm considering it for next year when my son is in application mode).

Of course, there's no way to know for sure how much a college will cost until a student is admitted and has received the financial aid package. I know families who have gotten shockingly generous aid that they didn't expect, and families who were deeply disappointed at the lack of aid offered. Again, the best thing you can do for your child is make sure they know that cost is a factor that has to be considered in deciding where they will ultimately attend.