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Stanford Alumni Magazine from Nov/Dec had a good article about just this in one of their recent magazines. They have interesting graphs showing how Applications to Standford (along with other Ivy's) have doubled in the last 10 years. While the acceptance of alumni is about triple of non-alumni that still isn't really great chances.

I'm don't expect that my son will be willing to jump through all the hoops to attract Standford or an Ivy. That is OK with me, I think fit is really the most important thing is choosing a university. The competition for the top schools in the past 10 years has gotten extremly intense requiring students not only get almost perfect grades/SAT's but load of extra curriculars, service and something unusual that makes them stand out.

Okay, if you assume that by "they" intparent means "retirement accounts in general", then "not available to pay tuition" is not true in many cases.

[It is true that if you withdraw from retirement accounts, you pay a 10% penalty (on top of any income taxes that apply, and it is almost always a very bad idea to do this. Also spending money that you need for retirement on something else is also a very bad idea.]

If the parent of the college student is at least 59.5 they can withdraw from retirement accounts penalty free.

For some accounts they can withdraw from those retirement accounts penalty free if they are at least 55, if separated from their employer.

For 457 plans they can withdraw from that retirement accounts penalty free at any age, if separated from their employer.

Roth contributions can be withdrawn at any time penalty free (and tax free).

For the non-Roth ones, the withdrawals will be income which will be taxed (and can affect many other things). And all withdrawals (even Roth ones) will affect FAFSA so you have to do the analysis. A Roth account is a very bad place to do college saving if you are planning to withdraw funds while the student is in college (except maybe the last year).

There is a more indirect sense in which the statement "retirement accounts aren't available to pay tuition" is not really right. Money is fungible, even though it can be place in containers with many restrictions and conditions. If you contribute as much as possible to retirement accounts (rather than directing some of those savings to college savings), then when it comes time to pay for college, your retirement savings picture is stronger, (and your FAFSA assets are less) and you can more afford to pay for college out of your salary, forgoing retirement contributions during those college years if necessary. Having more money in your retirement accounts puts you in a better financial situation overall, and so better able to afford college, using accesible funds, without jeopardizing retirement.

I just saw this edit. Although I can't say for sure what CSS Profile counts, I think what you are referring to is not retirement assets, but retirement contributions in a given year which are not taxable income (unless Roth), but which are added back as untaxed income to give the income figure they use (FAFSA too).

That is pretty realistic. Actually for us, Harvard and its ilk would be affordable, and the local state uni (kid living at home and need/merit aid) would be about equally affordable, though a let down. Most lesser privates, and out of state publics, are simply financially out of reach (though it's worth looking for exceptions). So the choice is either make it to the most elite places, or stay home (and try again for graduate school, which should be essentially free).

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Also, loans are not aid, despite what colleges call it. It should be called pretend aid. Some colleges might have a lot of this pretend aid, and others might have little or none. You have to look at the whole package and figure out, bottom line, what you're going to be paying (including interest), and decide if it's worth it, and if it's even affordable. Someone thinking that a loan is really aid, is like someone buying something with a credit card and thinking they're getting it for free. People need at least some basic financial literacy.

That said, while some people recklessly take on too much debt, others are too cautious. There is a place for some manageable debt. If you borrow $5k/year for 4 years, and then get a $50k/year job, you can easily pay off the debt in a year or two.

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I think a lot of people would quit their job and then work as a Wal-Mart greeter, if they would make just under $65K a year.

But, seriously, this is what I am seriously considering (except for the Wal-Mart greeter part). I'm seriously considering retiring (early) just before my oldest starts college, and I'm saving like crazy (in retirement accounts) to try to reach that goal. I'd wait and see my situation then, but depending on the college, it may be that the income means test, which can act like an additional 47% "tax", makes working barely worth it. Of course places like Harvard are so cheap, even for modestly above average incomes, that I could afford it even if I did keep working.

There was a study recently that showed kids who had to contribute to the college cost did better than those who got a free ride. Though it probably meant a free ride from the parents, not a scholarship free ride...sorry, time constraints on looking up the study. But it makes me think about teaching my kid the value of money. I had a tuition scholarship (in Canada)and my room and board was about 2000. I could carry a lot of that with my summer job and at U of Western Ontario, I got a part time job teaching skating during the winter months, which led to some hockey players asking me for skating lessons. Between all that, my Canadian university costs were well covered. But I also learned how to provide for myself. I want to teach my daughter that.

Out of curiosity I checked last night couple options and it still IS doable for my kids to go to university for close to free (just depends on what room / board options we would go with). Except they are 5.4 and 3.10 so we have long ways to go and who knows what situation will be like by then! lol If they go to the same still low cost, good quality, midwest university I went to, they can get the whole college experience, a degree in whatever field they choose, and get out debt free with zero to minimum financial constraints on us parents. If they decide to go with more expensive options, then they need to figure out how to get there.

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Agreed.

Some may say that a planned early retirement with the specific intent to game the system for need-based financial aid for college costs may be unethical, and an example of what some people may resent about a system which seems to help the wealthy and affluent become more so, while syphoning dollars out of the system which were originally intended to help those with "need", not those with "game".

Our current economy is shrinking. Many jobs are being outsourced overseas. Many other positions are changing from full-time (with benefits including health insurance) to part-time (without health insurance or other benefits). There are many good, hard-working people without paid employment. There are many more with part-time jobs which cannot pay for housing plus college. The unemployed and underemployed are negatively impacted by those who seek need-based financial aid for sport.

There is a saying, "Just because you can do something, doesn't mean you should".

Some people have played the system well, ranging from boasting of the faux divorce (occupying two of several owned residential properties as domiciles), to selling homes and converting proceeds to gold, to living off the grid on a cash basis.

Unfortunately, for some families "ethics" may not be a compelling reason to undertake one course of action and forego another.

I saw that discussed extensively (can't remember if it was on this forum or another) but it was quickly and thoroughly debunked. Basically the author set out to "prove" their pet theory with some shonky analysis, and it quickly became clear that the "study" was just rubbish.

You might seriously look at how financial aid is figured out before you attempt this. Other assets are included in how financial aid is calculated. The FAFSA doesn't look as closely into assets, but many private colleges require more detail that looks more closely into retirement accounts, real estate, etc. And you never know how the feds will change the rules over the years.

Why is no one talking about scholarships. Many private universities, but not the top tier, have very generous scholarships for top bright students. A few schools my daughter & I talked with would give top students (my daughter wasn't one) large merit scholarships AND admission to special honors programs. Just talked with a parent this morning who's daughters have gone this route.