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Saving for College While in Debt

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saving for college

A commenter on my last post brought up a topic that’s been on my mind lately: saving for college for our three kids. BAD community members then had a good discussion about how much to save for college and why, and how we should be upfront with our kids about what type of school they can afford.

Here’s what I’ve been wondering: How do you pay off debt, save for retirement, AND save for your children’s educations?

You see, our darling first baby is somehow 10 years old now. Ever since her birthday in January, we’ve been having our first real discussions about helping her (and her 8- and 5-year-old siblings) get to college. We just always thought we’d first pay off our debts, and then we’d have time to think about saving for college.

So… that means we’ve saved nothing for their educations. Zilch. Nada!

Our loans aren’t going anywhere for a while, and we only have eight years until our sweet girl is hopefully off to college or a trade school. The clock is ticking and we’d love to get started.

I’ve been researching 529 plans, college savings plans that have tax and financial aid benefits, and I had no idea each state offers its own plan. I wondered if we were too late to start a 529 for our 10-year-old, but I’ve been convinced to still go for it even if we can’t put a ton in.

Although I do think we’re too late to save for their entire educations, I’m honestly okay with that. I mostly paid my own way for my undergraduate degree. My parents were super supportive, helping stock my dorm room and paying for plane tickets traveling to and from home. But I was responsible for my tuition, books, and housing. I always worked summers and throughout most semesters. Plus, I used scholarships and Pell Grants when I could.

Fortunately, I went to an awesome, affordable university that helped make it possible for me to pay this way. It wasn’t until my senior year that I ran out of cash and took out a student loan. Sadly, no one had ever warned me against student loans. Luckily signing for it scared me so much that I paid it off within my first year of working.

(And then I married a guy who was off to a verrrrry expensive graduate program, and we somehow lost our minds and used student loans like they were fake money. Go figure.)

My point is that I want our kids to invest financially in their own education—I know that helped me get to class and not blow off my courses. I just don’t want them to be stressed out, run out of money like I did, and then turn to student loans that could burden them for decades. We’re considering offering to match what they earn. We can use those 529 plans, and then do our best to cash flow in those later years when our student loans are hopefully paid off.

But as I sort all this out, I always come back to the same question: How do we balance paying off our loans AND saving for retirement AND saving for college?

We have $288,000 of our student loans left to pay off, $100,000 in an IRA, and $0 saved for college. What would you do?

Dealing with Envy…

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Our friends bought a house over the weekend. It’s a beautiful house. Huge pool. Gorgeous backyard for entertaining. Perfectly new kitchen. It sparkled. All the things I wish for in a home.

My husband grabbed them in a huge hug. ‘I’m so happy for you!’ he said (he’s one of those annoying people who is legitimately happy for your success).

I smiled. ‘Congrats!’ I said. Inside, I struggled.

When we were paying off debt, we both worked. Together, we made good money. Nose to the grindstone. Get it done! Debt disappeared. Emergency fund built. We agreed we’d move to a single income with a stay at home parent after debt was gone which meant tighter budgets. Our ‘starter’ home will be our home for much longer than the ‘starter’ period in our lives. Our cars are older, and they’ll keep getting older. Name brands are laughable. Coupons are survival.

I stare at my friends, heck, I stare at my co-bloggers and think, ‘Geez! How much do these people make?!’. One of our couple friends was lamenting that they claimed zero on their taxes all year to ensure they paid enough. They made over $200K and had to pay taxes anyway. All I could think was, ‘Geez, I could do A LOT with $200K’. But instead, I say, ‘Ugh. Taxes right!?!?’

Some days, it’s just. really. hard. Even without debt.

It’s so hard not to focus on others. The highlights of their lives we see on Instagram and Facebook. Wondering if we missed the train to happiness somewhere.

In the whole ‘trailer debacle of 2020’, I failed to mention the reason we got a killer deal on our camping trailer. It was because the previous owner had a cat that made a scratching post of the interior. The sofa, the woodwork. Everything. Scratched. It wasn’t my dream trailer. It was what we could afford.

We went to Joshua Tree a few days ago. My kids scrambling up the rocks, the sky the most stunning shade of blue. My daughter squinting her eyes, trying to discern the plant in front of her from the plant in her Junior Ranger booklet. My son screamed ‘BUTTERFLY!!!’ as he chased it across the dirt path, crashing into us both, laughing hysterically.

Exhausted from our hike to Barker Dam and shenanigans in the surrounding rocks, we crawled into the trailer. The sun started to set, painting the sky the most beautiful hues of pink and purple. I left the windows open and let the cool breeze fill the trailer. We cooked dinner over the campfire and stared at the stars we so rarely get to see in the city. I put the kids into their beds, surrounded by completely unnoticed cat scratched woodwork, kissed noses and told stories. Later, hubby and I sat by the dwindling fire enjoying a bottle of cheap wine, listening to the gentle pop and hiss of the dying fire. He turned on the song we danced to at our wedding because he knows it makes me smile.

Some days it’s just. really. beautiful.

My bad days are usually because I’m focusing on what others have. My good days are usually because I focus on what I have. Money? Nope, don’t have much. But I have four kiddos who absolutely rock my world and I have a husband who acts like we got married yesterday.

I am a lucky girl.

How do I deal with envy? I make my very best efforts to stop looking at everyone else.

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