Earlier this week I paid what was the second to last tuition bill that we will ever have. We have already put one daughter through four years at Indiana University (out of state) and our younger daughter is now in her senior year at The University of Kansas (out of state). Seeing the light at the end of this tunnel is a feeling of such euphoria I may just start floating. Or, I'll probably start eating, which I haven't really been able to do since college began.
If I can offer advice to anyone pregnant, thinking about getting pregnant or that has small children: START SAVING NOW. Heck with food, clothing and a home. START SAVING NOW. When our girls were very small we consulted with a financial advisor about saving for college. At that time he estimated that if we put $300 per month, per child in a money market/mutual fund, we would have enough money to pay for 4 years of in state tuition based on calculated inflation.
Never once did he mention the cost of out of state. Maybe that thought should have crossed his mind? Perhaps he didn't know that by the time my girls were old enough to apply to The University of Illinois they would be basically blackballing Stevenson High School graduates. Case in point: my older daughter's roommate was rejected with a 3.9 and a 30 ACT. Nuff said there. And who knew that the program that she hoped to study would be eliminated the year before??
So, with both my girls in out of state schools, we had just about enough to cover 2.5 years each. We continue to put away that money every month. That has helped as well as us staying in our tiny house. One thing that we are proud of is that both girls will be able to enter the workforce without any student loan debt. But if we had not started saving when they were young, we would all be completely screwed.
Many families just don't plan ahead. Many can't afford to and leave the burden of paying for college to their kids.
According to Forbes, tuition and fees have risen 4.9% in the past decade, well beyond general inflation. The amount of student loan debt has risen 6% per year with 1 out of every 10 students owing more than $40,000 by graduation. 2/3 of all students have an average debt of $23,200 (in 2008 and has only increased since). Total student loan debt in the US is closing in on $900 billion.
With the job market as tight as it is, graduates can't even begin to repay their debt. 2 out of every 5 loans is delinquent with only 37% being paid on time. Kids can't afford to move out of their parents homes as they make their hefty monthly student loan payments.
Watching CNN a few days ago (I'd way rather be watching some mindless reality show, it's less depressing) there was a report on the rising cost of education. It was noted that there is the possibility that 20 years from now a 4 year education could cost as much as $500k-$1MM. For real.
I went on the website www.savingforcollege.com and calculated the cost of Indiana University for the future. I pretended my daughter was just 5 as of today. It tells me that I would need to be putting $1,021 away every month for a total of $326,576. Based on that, I'm pretty damned excited that our college paying days are almost over.
So, unless you can start black marketing your organs and live without your kidneys, get that piggy bank going.
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