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If you were to save some money for the kids aside from their education, what would it be for?
I'm talking only a 100 to 200 a month. nothing crazy. (but the timeline is between 15 and 25 years from now. so great opportunity for growth in the market)
The money would come from odd jobs or selling things on Craigslist, or uber-ing here and there, etc. nothing that would make a huge impact one way or another.
some options that come to mind include:
- their Wedding....
- their first car....
- once in a lifetime family vacation....
???
What would you 'save for' given the hypothetical scenario above.
It's a nice idea, but I'm not a big fan of saving money for kids with strings attached. Some kids don't pursue higher education for a variety of reasons. Some may never drive. Many won't get married. At a certain age, they may not even want to go on a big family vacation with you. You never know. Then what do you do with that money you've earmarked?
My husband and I have three kids, but we decided it was better for us just to "save" with no specific child-related goals in mind. We may end up spending money on specific things for each our kids; we may end up giving each of them a certain sum to do with as they like; we may just help them out as needed. Keeping our options open.
It's a nice idea, but I'm not a big fan of saving money for kids with strings attached. Some kids don't pursue higher education for a variety of reasons. Some may never drive. Many won't get married. At a certain age, they may not even want to go on a big family vacation with you. You never know. Then what do you do with that money you've earmarked?
I'm talking about non-529 money. That's a good problem to have. I'd just spend it any other way that pleases me. is that even a problem at that point?
I'm talking about non-529 money. That's a good problem to have. I'd just spend it any other way that pleases me. is that even a problem at that point?
No, not as long as you don't have expectations that put undue pressure on your child. My childhood best friend was told by her parents that since she had chosen to join the Coast Guard, she forfeited the money they had saved for her college education. Their relationship was never the same again.
No, not as long as you don't have expectations that put undue pressure on your child. My childhood best friend was told by her parents that since she had chosen to join the Coast Guard, she forfeited the money they had saved for her college education. Their relationship was never the same again.
oh, i agree. that's a f-ed up thing to do....to use or leverage money to pressure or persuade your kids one way or another.
that's not what i'm talking about here though.
the money would be in a separate account and you and you only would know about it. nobody needs to know. If you decide to pay for their wedding for example, the money could come from that account that in your mind you've always set aside as the 'wedding fund', etc. does that make more sense now?
I also don't plan on telling my kids that i've saved for all their education in 529 accounts. Not knowing would make them (i think) want to try harder to get scholarships, etc..., as opposed to 'knowing that their education is paid for...' like it was no big deal....
One of my former Supervisors and her husband gave both of their sons $250,000 each when the sons enrolled in college. This money was a one time only "Start Your Adult Life" stipend. They did this sometime between 2005 and 2010.
Money was to be used for 100% of College Expenses (including room and board costs), First home, First car, Costs of Internships, Graduate School Expenses, and however else each son felt like spending or saving the stipend.
Mom and Dad were both trained as Civil Engineers but Dad switched careers to becoming a Day Trader - obviously a successful one.
It worked well for the four of them but I don't recommend it as a standard practice for others.
I would save money to help the child with either their first car purchase, first home purchase, or a little of both. I find it more rewarding, however, if it's given in a way as to how much effort the child would be willing to put into saving for those things. For example, if my son wants to make his first care purchase, then whatever he can save up on his own, I will match. If he's able to save $3,000, I'll match with $3k. He, then, goes out and buys a $6,000 car. For a down payment for a new house, I would help him with the 20% down, but I would expect him to come up with at least half or close to half of the 20%. This would be within reason. If he's wanting a $500,000 home, he may be SOL on that. A $250,000 home might be more doable, and if he can save up half of the 20% down, I'll come up with the other half.
The point would be to still have my son start his adult life without debt (other than the house or course) and to live within his means, but instead of having it handed to him, teach him to work for it and through hard work comes reward. As much as I love my son, I would still like to get something out of life for myself. I didn't work as hard as I have to struggle.
No, not as long as you don't have expectations that put undue pressure on your child. My childhood best friend was told by her parents that since she had chosen to join the Coast Guard, she forfeited the money they had saved for her college education. Their relationship was never the same again.
Wow, IMHO, that is NOT right.
The daughter of an acquaintance of mine was able to get almost a full ride scholarship to college. Her parents had saved a substantial amount of money for college so they paid the rest of her expenses. After she graduated from college they said that she could use the left over money as a substantial down payment when she bought a house. It definitely was a win-win situation.
I would save money to help the child with either their first car purchase, first home purchase, or a little of both. I find it more rewarding, however, if it's given in a way as to how much effort the child would be willing to put into saving for those things. For example, if my son wants to make his first care purchase, then whatever he can save up on his own, I will match. If he's able to save $3,000, I'll match with $3k. He, then, goes out and buys a $6,000 car. For a down payment for a new house, I would help him with the 20% down, but I would expect him to come up with at least half or close to half of the 20%. This would be within reason. If he's wanting a $500,000 home, he may be SOL on that. A $250,000 home might be more doable, and if he can save up half of the 20% down, I'll come up with the other half.
The point would be to still have my son start his adult life without debt (other than the house or course) and to live within his means, but instead of having it handed to him, teach him to work for it and through hard work comes reward. As much as I love my son, I would still like to get something out of life for myself. I didn't work as hard as I have to struggle.
Great reply and great idea. Thanks for sharing. Will adopt your strategy for sure.
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