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Just wondering if anyone else is getting night sweats and daily anxiety from seeing the college fund we worked so hard to achieve so my daughter can go to any college she chooses (within reason) become worth less than one years tuition.
I'm a single parent and have been for nearly 20 years, so it's been with sacrifice. And it makes me only slightly angry (actually lots angry) to think it's a bunch of wealthy investment bankers and absolute idiots who wanted big houses but suddenly SAY they cannot READ their own mortgages (note: still paying my very large mortgage and only have a high school education--we all have personal responsibilities--it's called society)....so call me bitter if you like. But now what I have is a high school senior who has been told she can attend anywhere she likes. And I don't plan to disappoint at this stage in her life.
She was chosen and early. She is proud. I am anxious and worried. There is NO way the 529 will recover in time for it to make sense to withdraw, so I guess to cover the literal dumba**es who caused this crisis I will have to somehow come up with $45,000 in cash by next August 2009. Not sure how I'll do it ...any ideas, thoughts, relief? Seriously, need some guidance here, getting very frustrated and not creative and not all that educated in finance matters. Help!
Well, first off, most of the homes that are in foreclosure are not those of wealthy individuals but that is not the point.
As for college, if she has been told she can go to any school she wants I would guess that is because of her grades. If her grades are such that she can go anywhere, she will probably not have to pay much, if anything, for school. She needs to start writing for every scholarship available. She should target smaller, private schools if possible--they generally have large endowments and offer more financial aid then public schools. There will also be work-study and student loans (which are NOT a bad thing to have). Most of our friends that have freshmen in college have found that their children are paying next to nothing for school because they have good grades and are getting a lot of scholarship money.
Keep in mind that with her 529 plan, if she does get scholarships you can withdraw money from her 529 plan without penalty equal to the amount of the scholarship-which is a good thing--you can then put that money into a retirement account for yourself.
While they don't often advertise the fact, it is often possible to decline a binding early decision acceptance (if in fact that is what she has) for very few reasons, but finances may be one of them. Fill out the financial aid forms, as she may qualify for need based aid given the change in your family's finances. I also agree with scouring the internet and haunting her guidance guidance for scholarship opportunities..
You may need to have a very grown up conversation about exactly what is financially possible and have her submit some applications to state schools or privates with good merit aid as back up plans. If she knows the reality, she may take more initiative in looking for add'l outside sources of scholarship $$.
If it is any comfort, my husband and I are also having nightmares, but at least our daughter is a junior, so we have begun nudging her toward schools with some merit aid, and pushing her a bit more to get her GPA up a bit more to make it more likely she may qualify for some aid.
Thanks for the comments but it's really the timing that's a problem, we've lost over 140K in the last few months in that account and now that it's less than 40K to be specific, it cannot simply be taken out and has to stay in there go grow, so she can have a chance again. That's the real issue is timing. I just think it's so sad how all these economic changes are affecting everyone and I'm usually not fazed by them but this time the timing is just bad.
vh380, I assume you started this thread to vent and not because you want suggestions. Is that right? Because if you want to get out of an ED commitment, unexpected financial problems would be an excellent reason. There are many, excellent schools out there that have good merit aid. If you have not gotten your fin aid package offer, make sure that you apply for financial and merit aid. Even if you do not qualify for financial aid, if your daughter has very good grades, she should get some merit aid for that.
I understand that you do not want to disappoint your daughter, especially if she's been working hard all through high school to get into a top school, BUT you should not jeopardize your financial future for her if there is another alternative. When our kids were applying to colleges we did not tell them they could go anywhere they got in to. We told them we would pay up to a certain amount and after that they would have to take out loans. lo and behold, they chose wisely and will have/do have very small loans.
Thanks for the comments but it's really the timing that's a problem, we've lost over 140K in the last few months in that account and now that it's less than 40K to be specific, it cannot simply be taken out and has to stay in there go grow, so she can have a chance again. That's the real issue is timing. I just think it's so sad how all these economic changes are affecting everyone and I'm usually not fazed by them but this time the timing is just bad.
I am curious why you didn't change your allocations as you knew this was getting close. It sounds like you have the money in some pretty aggressive funds to have lost 3/4th of your investment.
You could put your 529 into a fixed rate account and not have that affected by the market too.
But the OP is asking if anyone has been hit by the economic problems...a little late for anyone who does not have a fixed account and has been saving for years.
I always thought the 529 was a little bit of a waste... although i could also see how it can be used as a tax shelter... My parents never planned for me to go to an expensive 4-year university... I went 2 years community college and then transferred to a 2 year university for my degree... I still became successful... success is what you make of your education, not where your education is located... paying more for the same education doesn't make you smarter.. As to the falling value of the 529, I see it in my 401k and other mutual funds... that's life... life isn't always sunny skies and strawberry sundaes... there are bad times and good times.. expect it and you won't be complaining... prepare for it and you wouldn't be suffering...
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