College Savings: A Provocation

Even though I know a lot about colleges (being in the biz), I have trouble writing about the topic because I am so conflicted. Yet this is a potentially budget-busting item of interest to many.

Here are my conflicts: I LOVE the small liberal arts colleges (Oberlin, Grinnell, Kenyon, Reed, and the like), yet I am resentful of a number of things: of the fact that I am not in a tuition exchange (if I taught at a private college my kids could get free tuition at similar institutions), of the fact that if I quit my job, my kids could go virtually for free, but that if I keep working, our two-teacher family income keeps us from getting need aid …. STOP!!!!!

I am also conflicted because though I wanted my son to WANT to go to one of these schools, he didn’t seem to care that much, and eventually chose to go to the state university, which offered him a large scholarship.

Here is the controversial part: as compulsive savers, we created 529 accounts for each child. We funded them for the cost of four years of room and board at the state university (or the cost of one year at a private college). Luckily, as it happened, we did not choose a stock account, so the money remains safe in fixed income.

We told out son (our daughter’s decision is yet to come, but the same applies to her) that if the money wasn’t used, we would give it to him after college.

I’ve seen many discussions of college costs, agonized essays on “is it worth it,” comments like “since we can afford it, why not.” But I’ve never seen a student offered the choice:

Go to Grinnell and we’ll try to pay for it;
OR go to the less expensive school and YOU can have the college account.

Our son chose the latter, though he was not motivated by visions of future money. Rather, he wanted to be free of the pressure to work in the summers (though he did work) and he wanted to travel (he went to Korea for a month after his first college year). He also likes the idea that he’s not taking any money from us for college.

So far, we haven’t dipped into the fund at all and he will have enough money to travel the world for a year after college, return and buy a car, and have some left over for a down payment on a house.

What’s really important is that so far, he seems happy with his choice.


I am interested in what others think of this . . . not that we have many readers yet. Any comments? Is there anything wrong with offering our children the residue of the college savings account? Is there anything right with it?

I will be writing about more aspects of college—finances, quality, etc., in the future as soon as my heart palpitations subside!