If you’re hoping and praying your kids go to college, how are you planning for college to be paid for?
About a month ago I was out in British Columbia celebrating some family birthdays when my cousin-in-law said something interesting. He said, “Nobody ever talks about money–like the specifics of it. So we have no way of knowing if we’re on track with savings for this point in our lives.”
It’s true, isn’t it? We don’t tend to talk about money in polite company.
Well, every Friday I write a quick, 400-word inspirational marriage moment to give you one thought to take into the weekend. And today I thought I’d do more of a “family moment” and open up about our money arrangements with our kids for college. We should be talking about this more, and I hope that it may help some of you, too!
Sheila’s Marriage Moment: How We Handle Money, College and Vacations Now That Our Kids Are Adults
When I went to university it cost, in total, about $7000 a year, including tuition, room and board, books, and personal stuff like clothing and toiletries. At summer jobs I was making about $15 an hour (I was awesome at word processing and Excel), and by working full time in the summer and typing essays during the school year, I didn’t have to borrow money and paid my own way.
Today, almost 25 years later, it costs about $18000 a year to go to the University of Ottawa, for all costs (and I know it’s so much more expensive in the United States!). And my girls were only making about $13 an hour as lifeguards. So there was no way they could fund themselves.
We didn’t want to just pay for school, though. We’ve heard of far too many parents who just paid for college and then the kids didn’t take it seriously.
So we did a matching grant system: We’ll give you a certain percentage of the full $18000, deposit it in your back account in September, and then you have to make up the rest by working or taking out loans. But you get nothing more from us until next September (and now that Rebecca’s graduated she’s cut off). You pay your tuition, rent, etc. out of that.
If they get scholarships, it doesn’t affect what we give them. They should benefit from those scholarships. (If we were using loans, though, or if school cost as much as it does in the U.S.–that would be totally different!)
This year, Katie made it her mission to not touch her savings. She wanted to live within what we gave her and her income from YouTube (which is far less than the $18000). She didn’t buy coffees, bought no clothes, spent no money. She wanted school to be a money making exercise! She’s a little too frugal, but having to pay for life was a great lesson.
Then here’s the long term plan: we all go together on one vacation a year, in July, which Keith and I will pay for. One year we’ll splurge for something big, like a trip, and then the next year or two we’ll all go camping. We need to build more family memories now that there’s another person in the family (Connor, Rebecca’s husband), and my girls need to spend time together to build their relationship since they don’t live together anymore. So instead of giving them money when they’re older, we pay for the family vacations.
So that’s our plan. I can tell you that if my girls didn’t have a clear need for university, and if we didn’t have the money to help them, I would never send them. University isn’t always worth it; College is cheaper and often a better route to get a job. But they’ve both made great contacts and met great people, and learned a lot about managing money and paying bills.
That’s what we do. What about you? Let’s talk in the comments!
Katie as She Started College: “I Have No Idea What I’m Doing!”
Here’s a video Katie made for her channel as she started university orientation last year!
Have a great weekend!
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Sheila Wray Gregoire has been married for 25 years and happily married for 20! She loves traveling around North America with her hubby in their RV, giving her signature "Girl Talk" about sex and marriage. And she's written 8 books. About sex and marriage. See a theme here? Plus she knits. Even in line at the grocery store.
Great topic! I listen to Dave Ramsey’s podcast several times per week which is a great place to get sound financial advice.
My hubby and I were discussing this topic the other day and while we didn’t come up with a firm plan, we had he basic idea of what you did with your girls. We want out kids to work for part of their expenses, but we also want to help them if they decide to go to university.
I think that’s so wise Stacey. University is so expensive and a big sacrifice for our kids and for ourselves. However, it’s an investment in their future, and so is making them pitch in too!
We also expected our kids to step up and not expect a free ride to post secondary. My husband and I contributed some to RESPs, but also encouraged our kids to put their own money in to receive the govt. match portion. Even babysitting and minuimum wage jobs add up when you save in the right place. But the biggest source of money has been leadership scholarships. Both my kids bought into writing scholarship applications ($/hr way better than minimum wage) and their church, camp, community and school volunteerism got my daughter a full ride scholarship and my son a $12,000 business scholarship. Both scholarships were spread over the degree, expecting the students to maintain a 3.5 GPA, so my kids were motivated to put the work in to maintain the scholarship. I’m proud my kids aren’t skipping classes or not trying because they know how hard they worked to pay for school. I’m happier about all the taxi driving and wasting time I did as a mom when they were teens because God is blessing their service even here on earth!
That’s amazing Danette!
My parents helped me through college as much as they could, but I worked during the school year and each summer. I got a few scholarships, and somehow managed to graduate debt free. Now that all three of us kids are done with college and married, we split family vacation costs by the number of mouths in each family.
That’s amazing that you were able to graduate debt free. What a great way to start off!
There is no freaking way hubby and I can pay for college for our kids, so they will have to do it themselves, just like my siblings and I did. I know a person who made it through med school debt free without his parents paying for it be working jobs and earning grants and scholarships.
I also tell my kids they need a plan. No drifting through college earning junk, useless degrees and wracking up debt. Instead, work a job or go to trade school.
Thankfully, we live near a lot of state universities that are fairly inexpensive and offer a wide variety of degrees. There’s no need for my kid to go to a private uni across the continent when he can get the same degree here for 1/4 of the cost.
I also paid for my own university and college. I was a single mom with two kids when I graduated and I’m still paying off student loans, but at the time it’s what I needed to support my kids and be there for them. I wish that I had a little help from my family, but it did strengthen me and I learnt not to take my education for granted. It forced me to work hard
I’m glad that you put an emphasis on education for your kids.
Something I’ve always wondered, being from the States, what is the difference between University and College? Here the two words are interchangeable.
In Canada, university is where you go for a degree. College = community college, which offers programs that are typically 2 or 3 yr diplomas, and which tend to be more practical and less academic. There is some overlap with joint programs – for example, some college accounting programs allow credits to be transferred to a university Bachelor of Commerce degree.
This is such a good article, and with 5 kids and my oldest graduating in a year it’s a bit terrifying! We have been a one income blue collar family for many years, and so having a ton to put away for University is not easy. However, since they were born we have put $20/month away in a RESP for each child. Family has also contributed at Christmas and birthdays towards our kids funds too. (even my Best friend who recently passed away left money for my kids education) It’s a blessing to see so many other people invest in our kids future.
So over the 18 years of their life, it still helps. Though it’s daunting how un-affordable university is, and really separates upper to middle class opportunities.
We probably won’t have enough to pay for it all, but we decided that our kids would pay for their first year of university 100%. That first year is always the make or break year, and the year most kids tend to flounder and enjoy their freedom a little too much/
We decided that they would pay for that year and then once they are settled, and really know what they want we will give all we have set aside for them.
That’s why we named our youngest “Spencer” which means money maker lol
Do we have a cultural lingo issue tripping us up here? I’m confused as to the Canadian difference between “college” and “university.” Here in the states, a college typically offers a 4-year, undergrad degree, and a university has those undergrad programs as well as master’s and PhD programs.
We also have “community college,” which typically offers two year degrees or just standard pre-requisite classes to save money when transferring to a 4 (or more) year school.
What is meant in this article?
Susanna, I have always been confused by the American system too lol.
Here is Canada ‘college’ is equivalent to what you call ‘community college’ with 2 year diplomas and pre requisites , not degrees. University is for 4 year + degrees all the way to Masters and PHD programs.
I’ve already old my 12 yr old that he’s on his own when it comes to paying for college/university. I cannot take out loans for my retirement but he can take out loans for college. That’s what I did. I attended a 4 year public university which was 13 miles from my parent’s home to get my BS in Nursing. I commuted and worked part-time during the school year and full-time during breaks and summers. I graduated with about $26,000 in debt, which was paid off over 10 years.
Luckily, my son’s grandmother gifted him with 15K in CD’s and I’ve encouraged him to put the monies he receives for Birthday Gifts into a savings acct.
I have about 18 years left at my job until I can retire with a pension, but still, that won’t likely be enough so I’ll be working up until lunch on the day of my funeral! LOL
We have three girls and what we do is we will pay up to a certain amount for college and anything over and above that is on them. We pay enough so if they choose a state university they won’t have to pay anything. We have good money and my husband has a good job so we are able to do this. My girls have always paid their gas and car insurance and money towards their phone bill ( about $30 per month) . We also go on a family vacation once a year and pay for it all because we want all of them to come to have family time. We just got back from Mexico with our 24 yr old married daughter and her husband, our 21 year old and 16 year old. Our oldest daughter lives 5 hours away so we don’t see them often and the 21 year old is at university away and a summer internship so it was so nice for our 16 year old to all be together for the week. We had very good family time so it was worth it!
We didn’t pay for our kids education at all while they went to school. They could grocery shop in my pantry when they came home and we sent surprise gift cards to dinner or movies. They knew it was up to them to pay. They worked very hard during the school year and planted trees every summer. A very hard job but it pays piecework and extremely well if you put your back into it. They were very careful with extras like clothes and entertainment and shopped at thrift stores and found free creative ways to be entertained.
When they graduated we paid their student loans (what was left of them) in full and made them swear not to tell their siblings.
They were all game to make sure their siblings ‘suffered’ just like the thought they did.
It was a good system for us because it taught them money management skills.
They were thrilled with the debt surprisingly paid and we’re grateful for the management skills they learned as a result.
Our theory was that you can earn $20,000 or $200,000 annually but you can be broke either way if you think money is disposable.
They all had axdosnpaymsnt for their first modest home by age 26. And it was due to to learning early that you have to work hard and save harder to make a go if in this world.
You have some hard working kids, that’s awesome!
I just don’t understand this mentality. College is something that is personally used by the person using it. They may, or may not use it to get a job after the may, or may not graduate and therefore why a parent is responsible for paying for any part of their “adult child’s” earning potential is beyond me. My parents offered to me that I could live in home, save on room and board, while going to college – but all of it had to be paid by me. That also meant I was limited to going to the nearby 4 yr community college, that has become a University, but is still gobs cheaper than other schools. All of my college bills were mine, and so if I opted not to go to classes, miss out etc. I was full responsible for my own actions and whatever came out of it. Also, I didn’t have to give a report card to my parents – something I would think is necessary when you are still a “child” and Mom and Dad are paying the bills.
The college system is a broken system any way at this point. There is no guarantee that the 4 yrs spent there will achieve you anything better in the long run, and even in the later 90’s they were figuring out that a 4 yr degree does not prepare you for real work life, so on top of that you have to work any way to figure out how to actually WORK at a job. Why are we paying thousands upon thousands of dollars to a system that can not educate you to teach you how to work at the job you are wanting to go work at? Few jobs need the extra education outside of Dr’s, nurses, lawyers etc. Teachers should not need degrees, but student teaching time and a certificate for a few extra children educational classes. Not a ridiculous 4 yr degree that rehashes 12 yrs of school the first two, then says it’s okay now to head up to some more advanced understanding. If parents are not rounding out their children at home and in the 12 yrs of school they have before hand, then I guess we can ship them off to a college to help them “round out” as adults, but I personally don’t want to pay money for that. I’ll save that money and round them out as people at home. We are promoting college, for the sake of promoting it these days – and giving into enormous, exorbitant amounts to send kids to school who use the 4 years in college to extend adolescents and piss away the education by drinking and partying with no real expectations of getting a decent job during that time. Not all drink and drug their way through those years but so many college students do that it’s an extremely serious issue. Do we change it? Do we stand up and yell loudly that this is enough and ridiculous. Mostly people just go along with the norm because it’s what everyone else is doing. While we send off our kids to college, “just cause” we are over looking the growing gap between hard working blue-collar jobs that can often pay up to six figures for a certificate that simply states you were committed enough to finish something.
Even if you don’t end up in a career directly from College, I still think the experience of learning, and the discipline of hard work and meeting many different minds, creates a deep maturity in most. I don’t think it’s a waste.
I don’t know if I have every commented here before but have been enjoying your blog for a few years. I really enjoy your honesty and boldness with how you present ideas. I would like to present a different view. First let me say, I am a parent of five young kids, so I have no parental experience with paying or not paying for education. BUT I have been a child on the receiving end of a paid for education. I have to say that I am VERY grateful my parents were able to make sacrifices and pay for my education ( they did put rules on the money like keeping grades up and not getting married until I had a diploma). Without their sacrifice and willingness to pay for my education, I would not have had the same opportunities. I am not saying that kids “deserve” their higher education paid for by parents, but that it is not wrong (if you can afford it) to gift your kids an education. And just because you gift a child an education, does not mean that they will not appreciate it or value it any less. My husband and I have lived with a lot and with very little in the 17 years we have been married, but I credit my parents with giving us a wonderful start to our lives together because we were able to start out our new lives together with NO debt. And for us, it allowed anything to be possible for our future.
That’s awesome Tabitha. It reminds me of some cultures who buy their child’s first home for them as a wedding gift. Their entire life is spent saving for their child’s first home so they can start off stable. Can you imagine starting off your marriage mortgage/ rent free?!
It may seem like a hand out, but then it is up to that newlywed couple to begin investing in their next generation.
I think as a North American culture we have really lost “generational” thinking. The “you’re on your own kid” is very much a cultural attitude that is not common in the rest of the world.
The govt gives a standards amount for each child (or used to until the new system this year) and we started saving it into a long term savings fund for each of our kids. We have it set up so that we maintain ownership md control for as long as we want. When the kids get old enough to require it, we will have the option to help them with schooling, travel, starting a business or buying a house. Our main goal is flexibility. They can also leave it in there and take it over as their retirement savings. It will totally depend on their character and needs at the time. Because we started shortly after they were born, they’ll have a good head startin whatever they decide to pursue.
I love the idea of family trips. My husband and I have talked about doing something similar when the kids grow up. Our oldest is only 8 but I’m a bit of a planner lol