High Income, Cutting It Close to Budget..please help me..?

Question

I am in my mid 40's, me and my wife are doing ok, any by other standards our income is excellent, but here is the thing. We have 4 children 16, 18, 21 and 23. out monthly income averages about 13,250(hold up), our monthly expenses average about 12,900, as you see we are coming close to that mark, and in august it will go up to around 14,300 we my daughter start college. I thint the colleges expenses are really what is eating us up, in 2009 we will have 3 in college, and 2 at the normal colleges, they are regular kids, no big scholorships. According to income standards we make to much to qualify for most grants and aid, and the loans they want to provide are rediculous, im talkin 11.5% to around 18% ( i dont know why he have excellent credit scores) so due to that we pay the tution out of pocket, me and my wife know the feeling of paying on student loans for 20 years so we would rather not put our children through that. I mean we are just average people we dont live an extravagent life.

Answer 1

13K a MONTH.... e gads.

First of all be sure that every child applies for fafsa every year.  No EXCEPTIONS.  Your finanical situation (and the amount they calculate you have to pay for thier schooling) changes with every passing year and with each child you add into college.  This makes a serious dent in family resources.  Be sure the "number in college" is correct.. now 3 (for all the kids fafsa) and next year 4 (for all the kids fafsas).

My suggestion is to tell the older 2  kids its time to fund it themselves. Completely!!! No cosigning, no cash, nothing.  It won't kill them.  And if they aren't resourceful enough to come up with the money (students can take out federal loans regardless of parental income - no cosigner - no credit check) and (despite protests) can work -often full time - while in college, then they need to find a cheaper school.  You've done your duty not you must move on.  Pay for the 2 younger ones for two years and then drop them too.

You also need to prep the the two younger ones for this NOW . You will pay for 2 years (or whatever) only... they need to choose a school they will be able to afford (on their own with federal loans) without your help after 2 years.  This way they don't pick the college that costs 30K a year because they know they'll be dropping OUT after mom and dad stop paying the bill. (Jrs and Srs can borrow up to 5,500 a year in federal loans).  This is a reasonable amount of debt and won't put them in the poor house.

If you feel you must somehow support them still to get them through college, make sure they know offereing a place to live in that big house while in school is a HUGE beneift.

Sell the house, the cars, rent and take the bus if you are really that determined not to have your kids pay for their own schooling, but you have worked hard for what you have.  You should be secure.   In other words, don't put yourself in the poor house for something you won't benefit from.  You don't want to have to move in with your kids when you are old and grey, in poor health.  Save for your retirement!!

Just my opinion, for what it's worth.