When it comes to funding college tuition for your children, sending one child to college is expensive, sending two is almost manageable, and sending three could be downright impossible.

The cost of college for your family is based on a calculation done by the government. It’s calculated using the parent’s income, the parent’s assets, the children’s income and the children’s assets. The more you make typically, the more you’re going to spend.

So when you’re sending your first child to college, it’s pretty expensive. And when you get into sending multiple children to college, it could not only be expensive, but it could also totally derail the retirement plan for the parents

And on top of that, we have the issue of fairness. You see, from what we’ve seen from our experience, the youngest child usually gets shortchanged. The oldest child has the most money because, let’s face it, the grandparents, the aunts and uncles, they all put money aside for the future of the first child. Not to mention they’re first in line. So they get first dibs on Mom and Dad’s cash flow.

Did you notice in the four factors you use for the FAFSA calculation? Not a single one of them had to do with the parent’s debt. So if the parents have a lot of debt, whether they be car payments, mortgages, boat payments, credit cards, that doesn’t factor it all into the formula for college aid.

But now we have the issue with each child, as we go down the ladder, there’s usually less money set aside for the younger ones, and the youngest usually has the least. 

So there are a few factors to consider here. Number one, is your child picking their college or are the parents setting guidelines on what they’re able to afford for each of the children? Number two, how much money is being set aside for each of the children, and is that sustainable throughout the life of the parents? And is that enough to get your children through college without derailing your retirement income?

A lot of times parents that we see are faced with the choice of sending their children to their dream school or funding their own retirement income. No parent should have to make that choice. 

So what’s the key? What are the keys to setting yourself up for college success to make sure your children could be successful and you could retire someday?

Well, the first is to start saving and to start saving early. Ideally, you want to be putting away 20% of your income and living within your means so that you’re able to fund college but also live comfortably. 

But let’s face it, there’s only so much cash flow to go around 20% sounds great, but how in the world can you do it when you’re struggling to get by today? And you know that somewhere down the road your children are going to want to have the opportunity to go to college. And college isn’t getting cheaper as time goes by.

Well, the key is to start where you are. Start saving what you can and start saving it on a consistent basis. And then as you progress and maybe you get a raise, you’re able to save more and more towards your goals. And that’s where we can help you. We help people identify where they’re giving up control of their money unknowingly and unnecessarily.

If you’d like to learn exactly where you’re giving up control of your money and how you could make it more efficient, check out our college page on our website, where we go through a deep dive of how we use this process for our clients.

And remember, it’s not how much money you make. It’s how much money you keep that really matters.