Beating Broke

Personal Finance from the Broke Perspective

How We’re Helping Our Teen Save for College

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College is getting more expensive every year, and with the student loan crisis, more and more students and parents are trying to forego student loans.  Avoiding student loans, if possible, is a smart way to go.  We should know; my husband and I are still paying off his student loans from graduate school, which he finished eight years ago.  So, we want to do everything we can to help our own children go to college without accruing any debt.  How we’re helping our teen save for college involves a multi-pronged approach.

How We're Helping Our Teen Save for College

How We’re Helping Our Teen Save for College

There are four ways we’re helping our teen save for college:

Using an Employee Discount

My husband is employed at our local university, so our children will get 75% off the price of tuition.  While this school currently costs approximately $12,000 for in-state tuition for a year, our children, thanks to the discount, will only need to pay $3,000 a year.

Matching Our Teen’s Savings

From the time our children were young, we set up a savings account for college.  We match each dollar that our child saves in this account.  Our three children all have varying balances, and one of our children is a much more prolific saver than the other two.  While this account won’t cover their $3,000 a year that they will have to pay for college, it will likely cover their textbooks for several semesters.

Paying for AP Tests

 

How We're Helping Our Teen Save for College
Photo by Ben Mullins on Unsplash

Our teen is bright and this year decided to challenge himself with an AP history course.  We paid for the AP test that he will take in May.  If he scores a 4 or a 5 on this test, he will be able to earn college credit for the course.

Next year, he plans to take several AP classes and tests, and we’ll pay for those, too, in the hopes that he can score high enough and reduce the amount of time he needs to be in college.

Finding Scholarships

Our teen took a practice PSAT at school, and while his score was okay, it wasn’t stellar.  Since he has a 4.0 in school, if he can raise his SAT score by at least 100, he will qualify for a $6,000 scholarship from our university.  (The higher the scores, the higher the scholarship amount he qualifies for.  If he could get his score even more than 100 points higher, he would qualify for an even larger scholarship.)

We don’t have money to pay for SAT tutoring, but having it would be valuable, especially if it helps our child raise his score and qualify for the scholarship.  I found a scholarship offered through a private foundation that could be used for SAT prep.  We applied, received the scholarship, and he’s begun tutoring this semester.

Final Thoughts

Money has been tight throughout our marriage, so we’ve never had much money to set aside for our children’s college education.  (Our priority has been paying off our student loans and saving for retirement.)

However, helping a child in other ways rather than just paying tuition outright can also be valuable.  This is how we’re helping our teen save for college.

 

The Best Spacing of Children for Your Finances

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My husband and I have three kids.  The first two are 4.4 years apart, and the second two are 17 months apart.  Our younger two get along great and are playmates most of the time, save for the occasional fight.  Our oldest is so far apart in age from them that he doesn’t really have much to do with either of the younger ones.

If you’re just starting your family or planning to do so, you may wonder what the perfect age separation is between your children.  That can vary wildly depending on your family, your kids, and their interests.  However, if you’re looking at the best spacing of children for your finances, I’d recommend having children 4 to 5 years apart.

The Best Spacing of Children for Your Finances

Why?  There are several reasons:

Braces

The Best Spacing of Children for Your Finances
Photo by Luis Quintero on Unsplash

My oldest got braces when he was 11.5, but they didn’t come off until he was 13.5.  We paid in installments (interest free) almost that entire time.  As soon as his braces were paid off, literally the next month, our middle child started the process of expanding her jaw to prepare for braces.  I’m thankful that we didn’t have to pay for braces for two kids at once.  I’m also thankful that it looks like our youngest won’t need braces, so I still won’t have to pay for braces for two kids at the same time.

Growth Spurts

I think our oldest is on a permanent growth spurt, and his appetite is no joke.  It was nice, for a few years when his rapid growth and appetite were larger than my husband’s, to still have two smaller children who had much smaller appetites.  I can’t imagine having three ravenous teenage children at once who are eating me out of house and home.

Day Care Costs

Our oldest attended day care and preschool while I continued to work.  He had almost finished preschool and was nearly ready to go to a public kindergarten (read free!) when we had our second child.  I did get ample maternity leave with my second, so we didn’t have to worry about paying for two kids in day care.

However, I was only back to work a short while before I became pregnant with #3.  When I thought about returning to work and looked at the daycare costs for two children under two, I realized I would be working simply to pay for daycare.  I quit my job and have been working as a freelance writer from home ever since.

College

The Best Spacing of Children for Your Finances
Photo by Ruijia Wang on Unsplash

This is probably the biggest reason to space your children four or five years apart.  You can get one child through college before the next one starts.  Sure, if you have more than one child in college you’ll likely qualify for more financial aid, but it will still cost you more than if you were paying for only one child in college.

Empty Nest

Okay, this one doesn’t have much to do with finances, but when you space your children further apart, you become an empty nester much more slowly.  When my oldest leaves home, I’ll likely still have several years at home with my younger two.  I can’t imagine having all of my kids move out around the same time if they are closely spaced together.

Of course, there are many considerations, not just financial, when deciding how closely to have your children.  However, the best spacing of children for your finances is four to five years apart.

If you have kids, did you decide on spacing based on finances or other factors?  How far apart did you space your kids and why?

 

The Worst Way to Prepare When Expecting a Baby

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When you see two pink lines on a pregnancy test, you may be ecstatic and ready to go into full on nesting mode, buying clothes, diapers, and other items.  However, doing that can actually be the worst way to prepare when expecting a baby.

The Worst Way to Prepare When Expecting a Baby

Here’s some of the poor purchases expectant parents make that they later regret:

Buying Diapers in Bulk

There are two problems with buying diapers in bulk that most first-time parents don’t think of.

Your Baby May Be Bigger or Smaller Than You Think

You don’t know what size your baby will be when born or how quickly he will grow.  Some babies are tiny and stay in the smallest size diapers for months, while others outgrow them within a few weeks.

Before we had our first child, several people gifted us with size 1 diapers.  The problem?  Our son came 17 days overdue, and he was almost 10 pounds.  Plus, he grew rapidly.  He only fit in those size 1 diapers for a few weeks, and we had plenty of leftovers.  We saved those for future kids, but all of our kids were over 9 pounds and fit in those diapers for just a few weeks.

Your Child May Be Allergic to a Certain Type of Diaper

Many babies develop a rash when using a certain type of diaper, and may need to be seen by a pediatric urgent care doctor in order to get treatment and help you figure out what might have happened to cause this.  What type of diaper, though, depends on the baby.  My friend had oodles of Pampers, but her baby broke out in a rash when using Pampers.  She could only use Huggies, so the stash she had of Pampers went unused.

Buying All Your Own Items

The Worst Way to Prepare When Expecting a Baby
Photo by Kelly Sikkema on Unsplash

Many expectant parents rush out to buy a play pen, crib, high chair, etc.  But why?  Chances are that, thanks to the generosity of coworkers, relatives, and friends, you will likely have several baby showers where you will get almost, if not all, of the items you need.

When we had our baby showers, we got every big items we needed such as a baby stroller, crib, baby bath tub, etc.

Buying Items In Gender Dominant Colors

When we had our baby showers, we didn’t yet know the gender of the baby, which turned out to be a blessing.  We asked for gender neutral items and could reuse them for the next baby, regardless of sex.  Our first child was a boy, but our next two were girls.

Time and time again, I see parents who are expecting a girl and buy every large baby item in pink.  Then, when the next child is a boy, they have to buy these items all over again and vice versa.  Don’t make this mistake.  If you plan on having several children, buy gender neutral large items.

Final Thoughts

Children come with many, many expenses.  In fact, most parents find that the expenses grow as the child grows older, and they continue until the child graduates from college.  The worst way to prepare when expecting a baby is to rush out immediately and stock up on diapers and buy big ticket baby items.  Instead, save your money for future child-related items and enjoy your pregnancy.