Affording private school

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doon
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Affording private school

Post by doon »

Hi - We have been contemplating sending our younger child to a private school (mainly for more 1/1 attention). We live in a great school district (but also highly competitive) and we have started to feel that the pressures of competitive school with relatively large class size is not a great fit for our child. We have older child who has coped well and probably will stay here till high school. The question that I have is around affordability and not around if it is a right decision or not. Here are the particulars of our financial situation
  • Age 47 and 45 (married), 2 children
  • Assets in tax deferred (401k, RothIRA) + Taxable ~ $2.5 m
  • Annual gross income - 21/22/23 - 450/550/650 respectively. Strong expectation to stay in $650 range for next 3-5 years.
  • Actual tax paid (Fed/State/SSA/Medicare) - 33%
  • Annual mortgage + property tax + home insurance (VHCOL) ~ $78k 12 years to go
  • Annual expenses ~ $240k (this includes the the $78 k in the line above)
  • Annual savings ~120 to 150k (including employer match etc.)
  • Don't have dedicated college savings because we dont get an tax break on 529. Plan to reduce savings rate or use some of the savings in taxable or roth for 2 colleges when the time comes.
  • Proposed private school cost ~$50k
Based on this I believe we can afford it. Please provide your thoughts on this.

Thanks and appreciate the inputs !
"Goal - Win the game before the need to retire"
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cchrissyy
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Re: Affording private school

Post by cchrissyy »

for sure
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crefwatch
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Re: Affording private school

Post by crefwatch »

Not every prep school is a paradise. If you suspect your child has a faintly perceptible learning impediment, I would suggest professional evaluation to be certain what is the very best thing for them. I say this not because the Quakers told my wife's mother "She will learn to read when God visits her", instead of saying that she might have Dyslexia, but because my 1-6 private elementary school (which needed the enrollments) got a reputation for taking "difficult" students because of its small size. After I was there in the 50's.

This is not a parent's report, but at my wife's tony Pennsylvania Prep school, she felt disrespected by the really wealthy students. (Yes, uniforms required at school.) Back in the 1970's, she had to share the Math Prize (all girls) because she was a scholarship student. And it is a fact that most Prep schools expect parents who pay full tuition to make substantial annual gifts in addition. Again, no personal experience.

I went to public Bronx High School of Science, where it was very difficult to be in the top 25%. Haverford and Columbia told me that my rank in class was not acceptable for admission.

Edit: Typo
Last edited by crefwatch on Fri Jun 07, 2024 2:27 pm, edited 1 time in total.
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TomatoTomahto
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Re: Affording private school

Post by TomatoTomahto »

We sent two of our kids to an expensive private school. At the time, we had “free” public school in Short Hills, NJ; look it up, a highly ranked public. Many of our neighbors thought we had to be nuts.

It worked out well for the kids. They had fallen through the cracks.

I would do it again in a heartbeat. The one we sent to private starting in HS I would have started in middle school if I could do it over. Worth every penny. He’s thriving now (5 years post college). It was transformational.
I get the FI part but not the RE part of FIRE.
afan
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Re: Affording private school

Post by afan »

You have to do what is best for your child and family. Children and schools differ. What might be best for your kid could be the wrong solution for your neighbor next door.

When you say you do not get a tax benefit from a 529 plan are you looking only at state taxes? You cannot defer federal income taxes on money in a 529 plan? You will not be able to spend those funds on education without paying tax on the gains when the time comes?

The saving rate seems sort of low for a 650k income. It might be fine for 450k. Which year does that reflect?

I suggest you plan out a budget that includes saving for college. The savings could be in an earmarked taxable account but 529 probably would be better. That will let you see how things look if you pay 50k per year for school then college for 2 kids. At your current income, it should be straightforward to manage it, but make a plan.
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er999
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Re: Affording private school

Post by er999 »

You can afford it with your current incomes, but you are committing to working for many more years as your current assets of 2.5 million, while a lot, are not much for a $240k annual expenses + $50k private school = $290k / year.

Obviously your spending will go down after you are done paying for college and the mortgage but a $290k spend, 3% withdrawal rate would require a 9 million portfolio so plan on working until mid or late 50s at the earliest. Once those expenses go down you’ll be fine with much less money.

As to whether it is worth it, many prior threads on the topic on bogleheads. I would lean towards a good education for kids rather than having a few extra million in inheritance when you die and they are presumably in their 50s so don’t think private school is a bad use of money.

One problem with many private schools I haven’t seen emphasized much on the prior threads is that due to distance their school friends are unlikely to be in the same neighborhood. As someone with kids in private school myself that is a big downside as you have more driving and complicated logistics for seeing friends. If there aren’t any good public options that’s fine but if I had to do it again would rather live some place with good neighborhood public schools.
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TomatoTomahto
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Re: Affording private school

Post by TomatoTomahto »

er999 wrote: Fri Jun 07, 2024 12:53 pm One problem with many private schools I haven’t seen emphasized much on the prior threads is that due to distance their school friends are unlikely to be in the same neighborhood. As someone with kids in private school myself that is a big downside as you have more driving and complicated logistics for seeing friends. If there aren’t any good public options that’s fine but if I had to do it again would rather live some place with good neighborhood public schools.
Logistics can be a problem, but in our case we appreciated the more diverse (socioeconomic, ethnicity, etc) student body in the private (if you want homogeneous, look up Short Hills, NJ public school).
I get the FI part but not the RE part of FIRE.
afan
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Re: Affording private school

Post by afan »

Our kids went to private schools because we thought it would be best for them. We think it was money well spent. There was a wide range of family wealth in their classes. Students from generationally wealthy families on one end. Students on 100% scholarship on the others. At least among our kids' friends no one cared at all. They had good friends from across the spectrum. We never had any inkling that there was different treatment by the schools for kids on that basis. Of course, that may depend on your specific school.

The student body was considerably more diverse than at the public schools in our area.
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stan1
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Re: Affording private school

Post by stan1 »

Yes you can afford it, do what's best for each child as an individual and assess what each school is good at offering to find a match. With your incomes you can make the best choices for your kids and it doesn't need to be primarily an expense decision. If kids do not go to same school (you didn't give ages) at some point you may need to explain to the older one why they went to public school while younger sibling did not. I would say don't shy away from that conversation when the time comes at the right age (the older sibling at a certain age will likely understand how they are different than the younger one). Some parents might try to equalize out the costs of education in the kids inheritance, but I'm of the opinion that they should get what they need to be fully functional adults contributing to society before worrying about any inheritance decades away.
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TomatoTomahto
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Re: Affording private school

Post by TomatoTomahto »

stan1 wrote: Fri Jun 07, 2024 1:32 pm Some parents might try to equalize out the costs of education in the kids inheritance, but I'm of the opinion that they should get what they need to be fully functional adults contributing to society before worrying about any inheritance decades away.
+1. One of my kids needed braces. No plan to alter inheritance.
I get the FI part but not the RE part of FIRE.
bombcar
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Re: Affording private school

Post by bombcar »

Earning $650 isn't enough for $50k in private school :D

But financially you can do it - whether it is advantageous to run that money through a 529 or otherwise make it more deductible, that's another question.

But $50k may also go decently far in private tutoring while attending a public school - but you know your kids best.
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Sandtrap
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Re: Affording private school

Post by Sandtrap »

doon wrote: Fri Jun 07, 2024 12:04 pm Hi - We have been contemplating sending our younger child to a private school (mainly for more 1/1 attention). We live in a great school district (but also highly competitive) and we have started to feel that the pressures of competitive school with relatively large class size is not a great fit for our child. We have older child who has coped well and probably will stay here till high school. The question that I have is around affordability and not around if it is a right decision or not. Here are the particulars of our financial situation
  • Age 47 and 45 (married), 2 children
  • Assets in tax deferred (401k, RothIRA) + Taxable ~ $2.5 m
  • Annual gross income - 21/22/23 - 450/550/650 respectively. Strong expectation to stay in $650 range for next 3-5 years.
  • Actual tax paid (Fed/State/SSA/Medicare) - 33%
  • Annual mortgage + property tax + home insurance (VHCOL) ~ $78k 12 years to go
  • Annual expenses ~ $240k (this includes the the $78 k in the line above)
  • Annual savings ~120 to 150k (including employer match etc.)
  • Don't have dedicated college savings because we dont get an tax break on 529. Plan to reduce savings rate or use some of the savings in taxable or roth for 2 colleges when the time comes.
  • Proposed private school cost ~$50k
Based on this I believe we can afford it. Please provide your thoughts on this.

Thanks and appreciate the inputs !
yes. you can afford to send your child to the best eduction and academic path that is best for them and optimal for the long term.

The average reading level of adults in the USA has been quoted statistically (yes, statistics again) at from 6th to 8th grade "public school" level.

Given that, where does your child now sit on the "bell curve'?

Here is an interesting article that may give food for thought.
"is it a cheetah".
https://www.stephanietolan.com/is_it_a_cheetah.htm

j :D
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soccerrules
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Re: Affording private school

Post by soccerrules »

You can afford it.

We sent one of our 3 kids to private school for MS/HS because he had learning differences and we felt the smaller intimate environment was best for him. It worked out well for us and he thrived in college graduating with the best GPA of our 3. Ours was faith based which for us offered another positive competent to make the private school commitment.

I would consider utilizing the 529 at least for college to benefit from the tax free growth on the dollars.
Don't let your outflow exceed your income or your upkeep will be your downfall.
avalpert1
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Re: Affording private school

Post by avalpert1 »

You currently save 2-3 times the needed amount, so you can clearly 'afford' it - the question is whether the tradeoff of spending on this vs spending on something else (be it today or later via retirement, early or otherwise) is a question only you can answer for yourself.
Sho
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Re: Affording private school

Post by Sho »

You can afford it
Sho
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Re: Affording private school

Post by Sho »

You can afford it
wunwun1
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Re: Affording private school

Post by wunwun1 »

At 3.5% SWR and 5% real rate, you will need a 7.5m portfolio to sustain your lifestyle of spending 250k per year (mortgage will be gone but you will have to pay taxes and healthcare). Assuming you save $100k per year going forward, you have to work for 15 years or so. (+ A few more years for college expenses)

You are looking at working 15 to 20 years in total.
Ibegtodifferonthat
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Re: Affording private school

Post by Ibegtodifferonthat »

I think your savings rate could be higher rather than putting it towards private school. You included employer match in your savings of 120-150. The match if including your spouse could be worth 20-50 itself. So you are only saving 15% off that. I would rather save that 50k or invest it into kids brokerage. They will thank you later. 25k gifted per kid for the next 12 years.
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TomatoTomahto
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Re: Affording private school

Post by TomatoTomahto »

Ibegtodifferonthat wrote: Sat Jun 08, 2024 6:20 am I would rather save that 50k or invest it into kids brokerage. They will thank you later. 25k gifted per kid for the next 12 years.
As a counterpoint, one of our sons has thanked us repeatedly for having him attend private HS. He doesn’t care about the annual gifts or inheritance; he made his own way financially.

Btw, I find it interesting that he says that if he would donate to education it would be to his high school and not Yale, because he feels the HS changed his life whereas if it hadn’t been Yale, it would have been another similar school and the outcome would have been similar.
I get the FI part but not the RE part of FIRE.
whaler08
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Re: Affording private school

Post by whaler08 »

Eight thousand dollar vouchers for private schools in Florida. Everyone is eligible, regardless of income.
avalpert1
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Re: Affording private school

Post by avalpert1 »

whaler08 wrote: Sat Jun 08, 2024 2:30 pm Eight thousand dollar vouchers for private schools in Florida. Everyone is eligible, regardless of income.
Which clearly puts a huge dent in the $50k cost they are talking about and any other relevant comments is off-limits for discussion here...
aristotelian
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Re: Affording private school

Post by aristotelian »

Yes, you can afford it. Education is too important to skimp on, especially when you make $650k (!) and have $2M+ already saved.

If the budget feels tight you should be able to find something in your $240k spending that you can cut. IMO you should be able to do better than $150k in savings (although arguably your payments to mortgage principal should count as savings).
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leeks
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Re: Affording private school

Post by leeks »

If you have $120K+ in annual savings, this private school would mean you would instead have $70K annual savings if you did not make any other changes. I don't understand why this is a question.
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leeks
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Re: Affording private school

Post by leeks »

er999 wrote: Fri Jun 07, 2024 12:53 pm One problem with many private schools I haven’t seen emphasized much on the prior threads is that due to distance their school friends are unlikely to be in the same neighborhood. As someone with kids in private school myself that is a big downside as you have more driving and complicated logistics for seeing friends. If there aren’t any good public options that’s fine but if I had to do it again would rather live some place with good neighborhood public schools.
This is very true and it is the primary drawback we experience with our kids in a private elementary. But "good neighborhood public schools" mean different things to different people and we have not encountered one we feel would be good for our particular kids.
bltn
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Re: Affording private school

Post by bltn »

If we decided to send a child to a private school costing 50,000 a year, when we were only saving 120,000 a year on 425,000 a year take home pay, I would take no more than 10,000 to 20,000 a year out of annual savings, and take the other 30,000 to 40,000 out of our current annual expenditures. But I would probably be saving a bit more than 120,000 on that take home pay.

Fortunately for us, our children went to well regarded public schools. We thought about the benefits of private schools. My wife went to a private high school, while I had to “struggle” through the public school system. We decided on high quality public schools with my wife providing educational help through the elementary school years as a SAHM. This worked out fine. With this system, I was able to accumulate quite a bit for the high priced colleges and graduate education to follow.
PowderDay9
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Re: Affording private school

Post by PowderDay9 »

whaler08 wrote: Sat Jun 08, 2024 2:30 pm Eight thousand dollar vouchers for private schools in Florida. Everyone is eligible, regardless of income.
Some of our friends are about to send their oldest to private kindergarten and just found out about this. They're high income and were surprised everyone qualifies. Pretty awesome benefit!

https://www.stepupforstudents.org/scholarships/
HIinvestor
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Re: Affording private school

Post by HIinvestor »

So much depends on the individual situation. We started our kids in public school from K. In 6th grade, we realized that all of our older kid’s friends were going to transfer into private school. We had both kids test and apply for private school, entering 9th grade. It was a great decision as it was a much better social and academic fit for both kids. Both kids still have friends from that private school, especially our daughter.

The kids ended up going to a private college with many of their private school friends.

We had a lot less income than you guys but still managed to cash flow the expenses for both kids, including private college. It wasn’t easy but for us well worth it.
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Watty
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Re: Affording private school

Post by Watty »

doon wrote: Fri Jun 07, 2024 12:04 pm Strong expectation to stay in $650 range for next 3-5 years.
.....
Proposed private school cost ~$50k
Based on this I believe we can afford it. Please provide your thoughts on this.
You would need figure out the details and adjust for taxes but one way to look at it is that you would just need to modify your budget as if you "only" made $575K a year and a tiny mortgage. :oops:

I never sent my kid to private school but people have posted that at some private schools there are also a lot of expectations for more donations and fundraisers so also be sure to know what to expect at this school.
doon wrote: Fri Jun 07, 2024 12:04 pm Annual mortgage + property tax + home insurance (VHCOL) ~ $78k 12 years to go
Annual expenses ~ $240k (this includes the the $78 k in the line above)
With having a tiny mortgage relative to your income you are spending a lot.

Aside from the question about the private school it would be good to watch the spending closer to make sure that you are getting good value for the money you are spending on other things.
Last edited by Watty on Sun Jun 09, 2024 2:18 pm, edited 1 time in total.
DDGD432
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Re: Affording private school

Post by DDGD432 »

doon wrote: Fri Jun 07, 2024 12:04 pm Hi - We have been contemplating sending our younger child to a private school (mainly for more 1/1 attention). We live in a great school district (but also highly competitive) and we have started to feel that the pressures of competitive school with relatively large class size is not a great fit for our child. We have older child who has coped well and probably will stay here till high school. The question that I have is around affordability and not around if it is a right decision or not. Here are the particulars of our financial situation
  • Age 47 and 45 (married), 2 children
  • Assets in tax deferred (401k, RothIRA) + Taxable ~ $2.5 m
  • Annual gross income - 21/22/23 - 450/550/650 respectively. Strong expectation to stay in $650 range for next 3-5 years.
  • Actual tax paid (Fed/State/SSA/Medicare) - 33%
  • Annual mortgage + property tax + home insurance (VHCOL) ~ $78k 12 years to go
  • Annual expenses ~ $240k (this includes the the $78 k in the line above)
  • Annual savings ~120 to 150k (including employer match etc.)
  • Don't have dedicated college savings because we dont get an tax break on 529. Plan to reduce savings rate or use some of the savings in taxable or roth for 2 colleges when the time comes.
  • Proposed private school cost ~$50k
Based on this I believe we can afford it. Please provide your thoughts on this.

Thanks and appreciate the inputs !

School is a craphshoot. If you don't pull the trigger and do the private school option and child ends up floundering in school/career/life, you'll kick yourself for eternity.
If they do well without private school, you'll post in forums how private school is a waste of money while patting yourself on the back for being so wise.

You can afford it. It might be life changing for your kid, it might be all for nothing.

Fwiw, I am fairly close in age, also with 2 kids, with similar income/net worth. However, I live in lcol area, smaller city, with poorly ranked public schools with a shocking amount of violence. Both my kids are in private school, though it's just elementary school and the total bill for two kids is less than 25k. Not sure what I'll do for high school. There is a fancy private high school 45 minutes away in a bigger city with a shuttle service to/from my town, but it costs a lot.

I say go for it. It might delay retirement by a year or two, and might result in keeping that car for 20 years instead of 10, and taking less fancy vacations, but there are worse things.
texasdiver
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Re: Affording private school

Post by texasdiver »

I gotta say, only on Bogleheads would you find a family with multiple millions in assets and earning $650,000 per year wondering if they can afford private school for their children. This isn't a criticism of the OP, just an observation of the mindset that we have here. I am no doubt the same in other ways.

Yes you can afford it. I would venture to guess that your level of wealth and income would put you well above the median for most private schools in the country. There are a whole lot of things you can afford with that level of income and wealth. The real question is whether that is the best use of your money. And that is something only you can really decide.
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TomatoTomahto
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Re: Affording private school

Post by TomatoTomahto »

I don’t know if this applies to OP, but we “felt” the effects of private school tuition much more at the beginning of private school than at the end; my wife’s income had increased sufficiently.

And, another plus, after years of paying private high school tuition, college costs are not as dramatic :D :beer
I get the FI part but not the RE part of FIRE.
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doon
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Re: Affording private school

Post by doon »

crefwatch wrote: Fri Jun 07, 2024 12:23 pm Not every prep school is a paradise. If you suspect your child has a faintly perceptible learning impediment, I would suggest professional evaluation to be certain what is the very best thing for them. I say this not because the Quakers told my wife's mother "She will learn to read when God visits her", instead of saying that she might have Dyslexia, but because my 1-6 private elementary school (which needed the enrollments) got a reputation for taking "difficult" students because of its small size. After I was there in the 50's.

This is not a parent's report, but at my wife's tony Pennsylvania Prep school, she felt disrespected by the really wealthy students. (Yes, uniforms required at school.) Back in the 1970's, she had to share the Math Prize (all girls) because she was a scholarship student. And it is a fact that most Prep schools expect parents who pay full tuition to make substantial annual gifts in addition. Again, no personal experience.

I went to public Bronx High School of Science, where it was very difficult to be in the top 25%. Haverford and Columbia told me that my rank in class was not acceptable for admission.

Edit: Typo
We are pursuing both approaches. Looking at private school options as well as getting evaluation done for any learning disabilities. If we can get some accommodation or individualized plan then public school may remain a better option.

We have noticed not so much difficulty in learning but difficulty in focusing. My child does very well in small settings (+1 for private schools). Also due to small settings i expect the environment to be a bit more sensitive to individualized needs of the children. In large settings such as public schools (1/20 ratio of teacher to child) where after certain grades children are expected to take most of the onus of keeping track of HW/CW/tests etc. the child is lost.
"Goal - Win the game before the need to retire"
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doon
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Re: Affording private school

Post by doon »

afan wrote: Fri Jun 07, 2024 12:48 pm You have to do what is best for your child and family. Children and schools differ. What might be best for your kid could be the wrong solution for your neighbor next door.

When you say you do not get a tax benefit from a 529 plan are you looking only at state taxes? You cannot defer federal income taxes on money in a 529 plan? You will not be able to spend those funds on education without paying tax on the gains when the time comes?

The saving rate seems sort of low for a 650k income. It might be fine for 450k. Which year does that reflect?

I suggest you plan out a budget that includes saving for college. The savings could be in an earmarked taxable account but 529 probably would be better. That will let you see how things look if you pay 50k per year for school then college for 2 kids. At your current income, it should be straightforward to manage it, but make a plan.
Agreed on the savings rate being a bit on the lower side. Partly this increase is very recent but we have been pretty consistent with at least $100k per year. Also I am only counting all the cash outlays towards savings. Meaning this does not include the annual RSU's which we do not touch and it just goes into savings.
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doon
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Re: Affording private school

Post by doon »

wunwun1 wrote: Sat Jun 08, 2024 5:50 am At 3.5% SWR and 5% real rate, you will need a 7.5m portfolio to sustain your lifestyle of spending 250k per year (mortgage will be gone but you will have to pay taxes and healthcare). Assuming you save $100k per year going forward, you have to work for 15 years or so. (+ A few more years for college expenses)

You are looking at working 15 to 20 years in total.
True that. But I don't think I am keen on early retirement either. Assuming there are no major breaks due to circumstances in job I plan to work for a while.
"Goal - Win the game before the need to retire"
silvergga
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Re: Affording private school

Post by silvergga »

.....
Last edited by silvergga on Mon Jun 10, 2024 1:10 pm, edited 1 time in total.
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doon
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Re: Affording private school

Post by doon »

TomatoTomahto wrote: Fri Jun 07, 2024 12:25 pm We sent two of our kids to an expensive private school. At the time, we had “free” public school in Short Hills, NJ; look it up, a highly ranked public. Many of our neighbors thought we had to be nuts.

It worked out well for the kids. They had fallen through the cracks.

I would do it again in a heartbeat. The one we sent to private starting in HS I would have started in middle school if I could do it over. Worth every penny. He’s thriving now (5 years post college). It was transformational.
Thanks for all your comments. I am aware of short hills public school as I am local to area as well. Do you mind sharing which private school you guys ended up. You can DM me separately. Thanks again!
"Goal - Win the game before the need to retire"
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doon
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Re: Affording private school

Post by doon »

Watty wrote: Sun Jun 09, 2024 2:17 pm
doon wrote: Fri Jun 07, 2024 12:04 pm Strong expectation to stay in $650 range for next 3-5 years.
.....
Proposed private school cost ~$50k
Based on this I believe we can afford it. Please provide your thoughts on this.
You would need figure out the details and adjust for taxes but one way to look at it is that you would just need to modify your budget as if you "only" made $575K a year and a tiny mortgage. :oops:

I never sent my kid to private school but people have posted that at some private schools there are also a lot of expectations for more donations and fundraisers so also be sure to know what to expect at this school.
doon wrote: Fri Jun 07, 2024 12:04 pm Annual mortgage + property tax + home insurance (VHCOL) ~ $78k 12 years to go
Annual expenses ~ $240k (this includes the the $78 k in the line above)
With having a tiny mortgage relative to your income you are spending a lot.

Aside from the question about the private school it would be good to watch the spending closer to make sure that you are getting good value for the money you are spending on other things.
Annual expense $240k includes $78 k in (mortgage, prop tax and insurance). two of our biggest expenses are mortgage and kids activities. Everything else is relatively modest. Still driving a 10 yo car.
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Topic Author
doon
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Re: Affording private school

Post by doon »

er999 wrote: Fri Jun 07, 2024 12:53 pm You can afford it with your current incomes, but you are committing to working for many more years as your current assets of 2.5 million, while a lot, are not much for a $240k annual expenses + $50k private school = $290k / year.

Obviously your spending will go down after you are done paying for college and the mortgage but a $290k spend, 3% withdrawal rate would require a 9 million portfolio so plan on working until mid or late 50s at the earliest. Once those expenses go down you’ll be fine with much less money.

As to whether it is worth it, many prior threads on the topic on bogleheads. I would lean towards a good education for kids rather than having a few extra million in inheritance when you die and they are presumably in their 50s so don’t think private school is a bad use of money.

One problem with many private schools I haven’t seen emphasized much on the prior threads is that due to distance their school friends are unlikely to be in the same neighborhood. As someone with kids in private school myself that is a big downside as you have more driving and complicated logistics for seeing friends. If there aren’t any good public options that’s fine but if I had to do it again would rather live some place with good neighborhood public schools.
Agreed with school friends etc. However, we are noticing a lot of families in our shoes around us are considering private schools. So we may have 3-4 kids along with us considering this option. Do not want to make this into political discussion but it seems that boys are getting left behind while girls are doing well. I see that stark difference at our home and been hearing the same from other families with boys.
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Watty
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Re: Affording private school

Post by Watty »

doon wrote: Mon Jun 10, 2024 10:28 am Annual expense $240k includes $78 k in (mortgage, prop tax and insurance). two of our biggest expenses are mortgage and kids activities. Everything else is relatively modest. Still driving a 10 yo car.
My mistake, I misread your post as if you have a $78K mortgage, not mortgage payments.

Even still spending $162k a year excluding housing and taxes is far from a "relatively modest" lifestyle. You can afford it so there is nothing wrong with it but it would be keep an eye open for ways spend smarter.
JPM
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Re: Affording private school

Post by JPM »

OP can afford the freight at the private schools, but it's a lot of money. If not spending the $$$$ on kids' educations, would it just be invested in the investment plan? A stable of Porsches? Something even more beneficial for the family?

IMO, my kids are better off in middle age with the educations DW and I paid for than they would be with an extra million or so each in their 40s and 50s (50s and 60s?) when they collect their inheritances. Reasonable people may disagree.
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TomatoTomahto
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Re: Affording private school

Post by TomatoTomahto »

JPM wrote: Mon Jun 10, 2024 12:40 pm IMO, my kids are better off in middle age with the educations DW and I paid for than they would be with an extra million or so each in their 40s and 50s (50s and 60s?) when they collect their inheritances. Reasonable people may disagree.
I like to think of myself as a reasonable person, and I agree wholeheartedly.
I get the FI part but not the RE part of FIRE.
silvergga
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Re: Affording private school

Post by silvergga »

Watty wrote: Mon Jun 10, 2024 10:47 am
doon wrote: Mon Jun 10, 2024 10:28 am Annual expense $240k includes $78 k in (mortgage, prop tax and insurance). two of our biggest expenses are mortgage and kids activities. Everything else is relatively modest. Still driving a 10 yo car.
My mistake, I misread your post as if you have a $78K mortgage, not mortgage payments.

Even still spending $162k a year excluding housing and taxes is far from a "relatively modest" lifestyle. You can afford it so there is nothing wrong with it but it would be keep an eye open for ways spend smarter.
I agree that "$162k a year excluding housing and taxes is far from a "relatively modest" lifestyle." We have a similar income, age, and have been sending our 2 kids to private schools since K grade.

My wife and I will probably question "why we need to spend $162k a year excluding housing" before thinking "should we spend $50k on private schools?". Everyone's priority is different but we don't spend $162k a year ex-housing in a VHCOL area, and we didn't think twice when sending our kids to private schools.

Yes, you can afford it and you can afford both.
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