We expected the economics to be the same for our kids as it was for us.  Cheap college.  Completely absurd post college housing costs.  We preferred to keep any "college money" for after their college years.  In the end, this is even more true for my kids.  They will pay less (than we did) for their college degrees. Housing has only gotten more absurd.

That said...  MH had the free ride but he also just lived at home during college years.  He told me he is not interested in saving MM(19)'s college fund while we pay for completely unnecessary luxury costs like housing 300 miles away.  The "Far away college" was not necessary to get him the same quality degree.  I am 100% on the same page.

For MM(19)'s freshman year I did not agree this was entirely fair, because MM received a (one-time) scholarship at this other college.  It would have cost him the same to live at home the first year.  But for this school year, I do appreciate the load off my shoulders.  Phew!   

We both want to leave some of this money for the kids, as long as they are choosing affordable degrees.  But for MM(19), it's just not going to be *all* of it.

We've been kicking the can down the road as much as possible.  Wanting to rely more on saved money when we have two kids in college at the same time.  & then all this financial aid delay during this school year.  Have been waiting for that to sort out.

But now it is time.  We agreed to cash flow MM(19)'s rent this year.  Food costs are just being carved out of our grocery budget (no new spending.)  & we will pull tuition from MM's college funds.  

The Gifted College Fund

This is a $1K annual gift from the in-laws, since birth.  MM(19) has probably received ~$20,000.  (I think one or two years might have been forgotten/skipped).  This gift has grown to $30,000 over time.  

I did give him the $1K gift for spending money this college year, but he just put this money in I Bonds (along with his earnings last year). 

In 2020 MM(19) had a big earnings year and we put $5K of this gift into a ROTH IRA.

This leaves him with $24,300 today, that is just sitting in cash.  

We paid $0 tuition last year and so we did not pull any money out from college funds.

We will pay $4,300 tuition this school year.  This works out pretty well.  I will draw this account down to $20,000, reimbursing ourselves for the $4,300 tuition.

I want to remember that with the ROTH IRA and the I Bond money, he technically still has $26,000 of this gift money left.  & he might receive another $2,000 from the in-laws during his college years ($1,000 x 2 years).

Next Year

DL(17) will most likely live at home and go to the local State college.  We will not touch his college fund.  I expect to pay ~$2,000 tuition in August and ~$2,000 tuition in January.

Note:  Will also get a $2,000 college tax credit; net cost is ~$2,000 for the year. 

We will pull MM(19)'s tuition from his college fund.  It will be $2,000 tuition in August, $2,000 tuition in November, and $2,000 tuition in February.

Note:  Will also get a $2,500 college tax credit back; net cost is $3,500 for the year.

I will cash flow the tax break, and so will pull ~$1,200 from MM's college fund every quarter.  I'd like to just reimburse ourselves every quarter, but will need more timely financial aid information in order to do that.  With two in college at the same time, I might err on just reimbursing what we actually pay and then putting back any financial aid refunds.  If it's anything like this school year was.

The above numbers presume $0 scholarships.

Unknowns

There's still a lot of unknowns re: next school year.

DL(17)'s situation is very cut and dry with the whole living at home thing. 

MM(19)....  Where to begin!

There is a lot that has to sort out re: housing.  He's trying to get free room/board or deeply discounted room/board re: RA position or other on-campus jobs.  He's trying to get on campus housing (as a backup plan.)   

Financial aid is supposed to be favorable with two in college.  This means nothing for DL(17) if he lives at home.  For MM...  I don't fully understand what this means.  If our "need" is $15,000, do they give us $15,000 next year?  I was going to say they've only offered us loans for negligible amounts of "need" in prior years.  But I guess to be fair, the school also knew that they were giving us scholarships and they knew the state was giving us aid.   In reality, "need" has been covered in past years. 

MM(19) might fare better with scholarships if he does demonstrate need.

I am just preparing financially re: what I do know, and any reduction in expenses will just be gravy. 

Update:  I transferred the $4,300 to our checking account and paid rent for the rest of the year.  I really enjoyed paying this expense with someone else's money.  😁  The rent bill just happened to match the $4,300 figure and I can pay it now.  I can't pay tuition until MM(19) registers for classes.