A Lot Of College
Laura has a good income, a bunch of kids, and not enough knowledge of how to save for college.
QUESTION: Laura has five children under the age of five, and doesn’t know how much she needs to save for college. Her household income is $90,000 a year. Dave tells her how much to save, and how to do it.
ANSWER: Wow, that’s impressive! The most you can put into an educational savings account is $2,000 a year. If you do that per year, you’ll have about $100,000 saved up for each. It will buy you state school education. Today it takes about $40,000 to go through. Do an educational savings account over a 529 plan for the first $2,000. You are in total control of the ESA all the time. It’s very flexible and you can change it around as you like.
Brainwash your kids to let them know that this is their college money; otherwise the government will take over half the money. Go to your mutual fund broker to get them started. Choose a growth and income fund that has been around for a while. For all the kids, that would be about $830 a month. You can do that if you have no other debt.