How to Pay for College while Early Retired

Get someone else to pay‼️

Before you read the following keep in mind this is the same family that brags they pay zero for ACA health care as result of subsidies and stimulus relief.

After roughly estimating our numbers and filling out the calculator, the results say we’ll get $4,250 in grant money when one kid is in college.  One year later when our second kid enters college we’ll get $10,250 PER KID.

That’s almost half of the total cost of attendance right there, before we even start talking about other sources of financial assistance offered such as work study or student loans.

Is this an equitable result?  Probably not.  

But that is how the system works.  We look poor on paper because they don’t ask about retirement account values and that is where 75% of our net worth resides.  Therefore we get a lot of free money for college.  And this is with us making zero effort to game our assets and income to maximize free grant money! If those grants work out, we’ll be paying a maximum of $14,000 per kid half the time and $20,000 per kid the other half of the time.

Source: How to Pay for College while Early Retired – Root of Good


  1. Perhaps you all forget. When the government took over college / student loans, the prediction was that taxpayers were going to profit from the initiative. See 2015 Brookings Institute article:

    “… These profits attract frequent criticism from politicians, most recently in a letter to the Education Department by six U.S. senators led by Elizabeth Warren, who has previously called the profits “obscene” and “morally wrong.” Does the U.S. government really make billions of dollars off the backs of student borrowers? Current debates on this issue devolve into an argument about accounting methods that pits the method that government budget analysts are required to use by the Federal Credit Reform Act (FCRA) against an alternative method called “fair value.” It turns out that no accounting method can end government profits on student loans, but a change to the loan program itself could. The FCRA accounting method says that federal loans make money for the government, while the fair-value method says they cost taxpayers money. In the most recent analysis by the Congressional Budget Office (CBO), FCRA shows a profit of $135 billion over 10 years, whereas fair-value shows a cost of $88 billion.[1] Put another way, FCRA shows a profit margin of 12 percent, whereas fair-value shows a subsidy rate of eight percent. (Unfortunately many estimates, including these, ignore administrative costs, which the CBO estimates at $35 billion over 10 years.)


    This is another Pocahontas boondoggle – what an idiot, she knows less than nothing about economics – she couldn’t tell the difference between a teepee and dog pee. See:

    “… The federal budget assumes the government will recover 96 cents of every dollar borrowers default on. That sounded high to Mr. Courtney because in the private sector 20 cents would be more appropriate for defaulted consumer loans that aren’t backed by an asset. He asked Education Department budget officials how they calculated that number. They told him that when borrowers default, the government often puts them into new loans. These pay off the old loans, and this is considered a recovery, even though in many cases the borrowers haven’t repaid anything and default on the new loans as well. In reality, the government is likely to recover just 51% to 63% of defaulted amounts, according to Mr. Courtney’s forecast in a 144-page report of his findings …
    “If you accounted this way in the private sector, you wouldn’t be in business anymore,” Mrs. DeVos said in a December interview. “You’d probably be behind bars.” …Former Secretary of Education Betsy DeVos commissioned an outside analysis of the student loan program’s finances. … Mr. Courtney’s calculation was one of several supporting the disclosure in a Journal article last fall that taxpayers could ultimately be on the hook for roughly a third of the $1.6 trillion federal student loan portfolio. This could amount to more than $500 billion, exceeding what taxpayers lost on the saving-and-loan crisis 30 years ago. …”

    Worthless, inane, stupid, … And, importantly, if those working the system on the front end play it smart and finance the rest of the cost with student loans, and work the system just right, they’ll only have to pay a portion of the loan back.

    I’m not going to repeat my own drivel about student loan debt “forgiveness”…


  2. I find this pretty annoying. I’m 67, still have a girl in a doctoral program in Clinical Psych that I pay rent, car payment, car insurance (has to commute 80 miles a day to afford housing) and health insurance. Glad to help her out (2 years to go!). Late life divorce at 55, retired with state pension (marital reduction) at 64. Due to divorce also have a mortgage. When the kids were young, the wife and I bought a 4 and 2 unit property, busted our butts rehabbing/tenant managing, and paid the family home and both properties off before the older one started college…using the rent roll as tuition. Both attended excellent private universities, and got out with no undergraduate loans. Grad school was on them. The older had to borrow 500K for med school, and is now a hospital program director for her specialty. I’m helping,out the younger one with living expenses to finish, as mentioned above. Obviously the impact of divorce was very significant, but I’m comfortable, and have the essentials. With a chronic lung ailment, I recognize the importance of life, happiness and contentment. With enough to live on, I consider myself lucky.


  3. As much as this seems wrong that they are legally using the system to look poor to get financial aid, I am going to have to let this slide. It is a case of whether or not that the government is going to pay to support them now or later in old age. If the goal is to have retirement money set aside in old age to help pay living and medical expenses, than that money should be left alone by the government.

    Imagine if the government started counting the future value and or actual value (which ever is higher) of your 401K, IRA, or 20 years of future pension income or social security income value every time you paid your taxes or filled out financial forms or FHA loans. Then they would figure out a way to tax that money that you have not receive yet. What a mess.

    One possible unintended consequence might be that even more people will fail to save for retirement and the government has to take care of them anyway. It might actually be cheaper to pay $10k per year for college for 4 years than to pay $10K for 20 years after they turn 65.

    I don’t like it but I’ll bet that some self employed and small business owners run into similar headaches of having business assets count against them depending how they file there taxes. (I am just guessing here).

    But it is true that the trick is to get someone else to pay for college. I did. Between my military service and my company, I was paid to go to college with 95% of my tuition payments covered. Was I in the wrong or smart?


      1. Yet it bugs me too. But I retired at 55, full pension, very large 401K, and I still got the Covid-19 checks. I didn’t need it. I didn’t ask for it. It wasn’t right. But I spent the checks. Unfortunately, I would say more than 50% went to China because that is where the stuff is imported from and no local shops were allowed to be open here in NJ. I couldn’t even help my barber by getting a haircut for months.

        I can’t blame this guy for taking advantage of the loopholes in the law. I mean I took advantage of the law to save tax deferred in my 401K. But because of that I was able to save more. I had deal with taxes all my working life so it is not a big deal. In fact, it is a good problem to have vs having no money at all in retirement. Could I have been smarter 20 years ago, sure, but I never dreamed that everything worked out so well for me.

        Maybe one day they will close the loopholes. But for now, if it is all legal, then I can’t be mad at him for being smarter than me. I blame those in Washington for the rules and regulations that allow it. Maybe if the government didn’t give colleges a blank check in the form of guarantee loans, college could still be affordable and it would be such a big deal.

        I am kind a of curious how his working basically only the minimum quarters required to qualify for social security and Medicare works out in his old age planning?


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s