May 18, 2011,
A.L. asks from Aledo, TX on May 16, 2011
Financial Planner/Advisor for Kids College
So, I am wondering if any financial advisors out there can help me with this. I am currently in grad school and when I finish I will be making a good salary. My oldest will be 8. I have 10 years to have his college tuition and living expenses saved, and my husband and I have briefly thought of how much that needs to be.
How does this work? Do people invest a certain amount and let that take off? If so how much? Do people put some back each month? Where is the best place to put it? I have heard of the different college savings plans and I am trying to figure all this out so when I graduate I can hit the ground running. If anyone else has any suggestions for what they have done I would appreciate that as well. I have 2 sons and may have 1 more child, so I need to get saving!!
2 moms found this helpful
K.U. answers from Detroit on May 16, 2011
I'm not a financial adviser, but many experts will tell you that you need to make your retirement a priority over saving for your kid's college education. They can always get loans, scholarships, etc. to help cover the costs of college but retirement savings is entirely on you. I would make sure you are putting away for retirement and that you have several months of savings in case of an emergency, before putting aside money for college.
5 moms found this helpful
S.M. answers from Dallas on May 17, 2011
Daveramsey.com has preferred financial advisors, (ELP's or Endorsed Local Providers) that are wonderful, I talked to one last year and he was so good to go over everything I had already, and explained everything to me, I was actually on the right track. He also made recommendations for what to do in going forward. I was very impressed, you might check his website for and ELP in your area. They wont try to sell you something that you don't really need. I drove to Dallas from the Ft Worth area and it was well worth it!
S.N. answers from Minneapolis on May 16, 2011
DVMMOM is right.... once you have that accomplished and can have a set amount going into your retirement along w/ the college money you will want to look into a 529 account.
It allows for the money to grow and be tax free upon withdrawal (I'm not a financial consultant so you'll need to look up the particulars!) You'd set up one account per child. we put a few thousand in each one and then did a $250 per month deposit per account. It's added up quickly. What is nice is that you can shut it off at anytime. We're currently not contributing.. but hope to start again in the future.
I was fortunate enough to have all of my college expenses paid for by my parents and when looking to set that same scenario up for our kids (cover costs for a private 4 year institution) at birth (literally month one :) ) we would have had to put $500 per child/per month away for the next 18 years!! So, it is spendy if you want to cover 100% and are thinking you would like your kids to go to a private college.
On another note I recently read an article that said you should divide all anticipated college expenses by 3 and plan on paying 1/3 via student loans, 1/3 via college savings funds (like a 529) and 1/3 via funds that you/your child is earning at the time.
G.H. answers from Chicago on May 16, 2011
I agree with having your retirement planned out before you save for college......you cannot take out loans for retirement but you can for college
dave ramsey has great recommendations & tips for college savings, pick up his book at the library for the details, he even has a special calculations table in there for both retirement savings & for college savings.......there is so much to finances & i love that he has it all spelled out on what you should accomplish 1st & what should be done last
S.E. answers from Wichita Falls on May 17, 2011
There are alot if ways to do this and vehicles to use. You can save in a college specific plan such as a 529 (which can be use towards and higher education expense includin room and board) or a general investment account. But the best place to start is a budget - yours. Look at your budget and see how much you can afford to put aside. Every time you get a raise, put half of that into savings.
Also talk to your husband about how much of the education expense burden you are willing to shoulder - all of it, tuition and books only, state school, private, ect. Education expenses are increasing faster than inflation. Plan for a 7% increase a year.
Keep an I out for scholarships, there are some that can be won even at this early of an age ( I knew a family that won one for winning a crawling race at 9 months old). And encourage your children to do well in school and areas they have intrest. This will lay the foundation for future scholarships.
C.W. answers from Dallas on May 17, 2011
Hi, I'm not a financial advisor, however we do have a financial advisor with Edward Jones. Edward Jones is great. I'll be happy to share his name with you and you can talk to him on the phone or meet with him for a consultation for you and your family's financial needs. He is wonderful and is very knowledgable and loves to help others understand finances, saving for your retirement and other expenses like College,etc..... He is also a Father too.
We got a 529 plan and yes, we invested some money with that. We can contribute more each year towards that. Remember there is always scholarships and grants that your child could apply for as well. We have our payments taken out automatically out of our checking account and my Husband's paycheck and it is so much easier that way to invest in our accounts/savings,etc.... Our financial advisor has also encouraged us to start a discretionary account for extra things they want-vacation or extras that we want. We also have IRA that are for our retirement accounts.
Another great option is Upromise. It is set up for saving for your child's college or trade schools,etc... Go to Upromise.com Basically you save money each time you spend buying an item with a company that is on Upromise's list. We've saved a $400 this way. You do need a credit card/debit card to do this. The grocery stores do have items marked Upromise-mostly name brands. You don't earn a huge amount of money this way, but you can get family and friends to help out with this also. Hope this helps!
T.F. answers from Dallas on May 17, 2011
First off.... I am not a financial planner. However, hubby and I are very into investing, retirement, college funding, wedding fund, etc.
We have a 16 yr old. We started her fund before she was born. Our goal was $10,000 a year by each birthday. Of course with market fluctuations, sometimes we ended up putting more in to cover the loss if any. We still add to the fund. She should be fully funded at this time.
We are believer that it is our obligation to get her out of school with NO DEBT. We live debt free and we will not let her start her career with debt.
That said, retirement is also extremely important. We are funded as well. We have sacrificed, saved and used delayed gratification to make it happen.
We do have an advisor at Edward Jones. He is good because he helps removed the emotional attachment of the decisions. We are good at the decisions but we need someone to say WHOA if needed.
We are well diversified with real estate, numismatics, savings bonds, 529, IRA's and multiple income streams.
Good luck to you!
J.S. answers from Dallas on May 17, 2011
A., I have a WONDERFUL financial advisor with Ameriprise Financial in
Richardson. He is on Campbell Road, just east of 75. His name is Charlie Pepkin. He's been my financial advisor for 17 years. My husband died 12 years ago and he has taken great care of my finances. His phone number is ###-###-#### and email address is ____@____.com office is located at 801 E. Campbell Road, Suite 585, Richardson. Tell him J. from Denton sent you.
K.S. answers from Dallas on May 18, 2011
I highly recommend Shirley White-Stevens in Allen: http://www.shirleywhitestevens.com/
Not only is she an independent certified financial planner, but she specializes in college savings. She is AMAZING!
C.B. answers from Dallas on May 17, 2011
May I recommend Mark Cannon with Ameriprise Financial - ###-###-####. He's a really nice and intelligent person with a young family of his own. He's been really helpful with us (getting started) and my mom (entering retirement).