College Funding — Salary Scenario Analysis
Updated 2026-04-13 | Companion to College Funding Plan
Purpose
Jennifer's salary may change. This analysis shows how three salary levels affect the college funding plan — specifically the Parent PLUS loans needed during the overlap years when both kids are in college simultaneously.
Assumptions
All assumptions match the base college funding plan except Jennifer's salary:
- Chris salary unchanged: $225,000/yr → $10,983/mo take-home
- College cost: $64,452/yr per kid (out-of-state)
- 529 balances: $25K each, growing to ~$46K (Kid 1) and ~$47K (Kid 2) by use
- 529 contributions: $1,500/mo Aug 2026–Jul 2028
- Emergency fund: $1,500/mo until ~$46K target met
- Extra loan paydown: $1,500/mo ongoing
- Fixed costs (post-debt, post-SLUH): $5,449/mo
- Essential variable: $3,800/mo | Discretionary: $2,425/mo
Take-Home Estimation
Jennifer's current take-home is known: $170,000 → $8,400/mo. For other salary levels, each $1,000 of salary change maps to ~$634/mo in take-home (marginal rate: 24% federal + 7.65% FICA + 4.95% MO state = 36.6%).
| Jennifer Salary | Take-Home/mo | Household/mo | Available Baseline/mo | Available Baseline/yr |
|---|---|---|---|---|
| $130,000 | $6,287 | $17,270 | $5,596 | $67,152 |
| $155,000 | $7,607 | $18,590 | $6,916 | $82,992 |
| $170,000 | $8,400 | $19,383 | $7,709 | $92,508 |
"Available baseline" = household income − fixed costs − essential variable − discretionary. This is the pool that funds emergency savings, loan paydown, 529 contributions, and college cash flow.
Scenario Comparison
| $130,000 | $155,000 | $170,000 (Current) | |
|---|---|---|---|
| Monthly income loss vs. current | -$2,113 | -$793 | — |
| Annual available for priorities | $67,152 | $82,992 | $92,508 |
| Years requiring loans | 5 of 5 | 3 of 5 | 2 of 5 |
| Total Parent PLUS borrowed | $221,856 | $143,196 | $105,132 |
| Est. balance at repayment | ~$275,000 | ~$177,000 | ~$115,000 |
| Standard 10-yr payment | ~$3,340/mo | ~$2,150/mo | ~$1,400/mo |
| Total interest (10-yr) | ~$126,000 | ~$81,000 | ~$53,000 |
| Total cost of loans | ~$401,000 | ~$258,000 | ~$168,000 |
Every $10K salary reduction costs roughly $25,000–$32,000 in additional Parent PLUS loans — and that's before interest. The cost per $10K accelerates at lower salaries because more years tip into deficit.
Scenario Detail: $130,000/yr
Jennifer take-home: ~$6,287/mo | Household: $17,270/mo | Available baseline: $67,152/yr
Year-by-Year
| Year | College Cost | Available | SLUH | E-Fund | Loan Paydown | For College | 529 Used | Loans |
|---|---|---|---|---|---|---|---|---|
| 2027–28 | $64,452 | $67,152 | -$16,500 | -$18,000 | -$18,000 | $14,652 | $46,000 | $3,800 |
| 2028–29 | $128,904 | $67,152 | — | -$10,500 | -$18,000 | $38,652 | $47,000 | $43,252 |
| 2029–30 | $128,904 | $67,152 | — | — | -$18,000 | $49,152 | — | $79,752 |
| 2030–31 | $128,904 | $67,152 | — | — | -$18,000 | $49,152 | — | $79,752 |
| 2031–32 | $64,452 | $67,152 | — | — | -$18,000 | $49,152 | — | $15,300 |
| Total | $515,616 | $200,760 | $93,000 | $221,856 |
At $130K, loans are needed in every single year — including Year 1 (Kid 1 only) where the 529 falls $3,800 short, and Year 5 (Kid 2 only) where cash flow can't cover one kid's costs.
Repayment
| Strategy | Monthly | Paid Off | Total Interest |
|---|---|---|---|
| Standard 10-year | ~$3,340/mo | Nov 2042 | ~$126,000 |
| Aggressive | ~$5,000/mo | ~2037 | ~$60,000 |
At $3,340/mo, loan repayment alone would consume 60% of the available baseline post-college — severely constraining retirement savings and other goals.
Scenario Detail: $155,000/yr
Jennifer take-home: ~$7,607/mo | Household: $18,590/mo | Available baseline: $82,992/yr
Year-by-Year
| Year | College Cost | Available | SLUH | E-Fund | Loan Paydown | For College | 529 Used | Loans |
|---|---|---|---|---|---|---|---|---|
| 2027–28 | $64,452 | $82,992 | -$16,500 | -$18,000 | -$18,000 | $30,492 | $33,960 | $0 |
| 2028–29 | $128,904 | $82,992 | — | -$10,500 | -$18,000 | $54,492 | $59,040 | $15,372 |
| 2029–30 | $128,904 | $82,992 | — | — | -$18,000 | $64,992 | — | $63,912 |
| 2030–31 | $128,904 | $82,992 | — | — | -$18,000 | $64,992 | — | $63,912 |
| 2031–32 | $64,452 | $82,992 | — | — | -$18,000 | $64,992 | — | $0 |
| Total | $515,616 | $279,960 | $93,000 | $143,196 |
At $155K, Year 1 stays loan-free (529 covers the gap) and Year 5 squeaks by with a $540 surplus. But the overlap years (2–4) still require significant borrowing. Loans first appear in Year 2 — one year earlier than the current scenario.
529 Depletion
| Kid 1 529 | Kid 2 529 | |
|---|---|---|
| Start | $46,000 | $47,000 |
| After Year 1 | $12,040 | $47,000 |
| After Year 2 | $0 | $0 |
Both 529s are fully depleted by end of Year 2 — one year earlier than at $170K.
Repayment
| Strategy | Monthly | Paid Off | Total Interest |
|---|---|---|---|
| Standard 10-year | ~$2,150/mo | Nov 2042 | ~$81,000 |
| Aggressive | ~$4,000/mo | ~2036 | ~$35,000 |
Scenario Detail: $170,000/yr (Current)
Full detail in the College Funding Plan. Key numbers repeated for comparison:
| Year | College Cost | For College | 529 Used | Loans |
|---|---|---|---|---|
| 2027–28 | $64,452 | $40,008 | $24,444 | $0 |
| 2028–29 | $128,904 | $64,008 | $64,896 | $0 |
| 2029–30 | $128,904 | $74,508 | $3,660 | $50,736 |
| 2030–31 | $128,904 | $74,508 | — | $54,396 |
| 2031–32 | $64,452 | $74,508 | — | $0 |
| Total | $515,616 | $327,540 | $93,000 | $105,132 |
Loans only in Years 3–4. 529s last through Year 3. Year 5 has a $10,056 surplus.
Standard 10-year repayment: ~$1,400/mo | Total interest: ~$53,000
The Real Cost of Each Scenario
Including principal + interest on a standard 10-year repayment:
| $130,000 | $155,000 | $170,000 | |
|---|---|---|---|
| Salary reduction | -$40,000 | -$15,000 | — |
| Additional loans vs. current | +$116,724 | +$38,064 | — |
| Additional interest vs. current | +$73,000 | +$28,000 | — |
| Additional total cost | +$189,724 | +$66,064 | — |
A $40K salary cut costs nearly $190,000 more over the college + repayment period. A $15K cut costs ~$66K more. These numbers include both extra principal borrowed and extra interest paid.
Cost Per $10K of Salary Reduction
| Range | Extra Loans per $10K | Extra Total Cost per $10K |
|---|---|---|
| $170K → $155K | ~$25,400 | ~$44,000 |
| $155K → $130K | ~$31,500 | ~$49,500 |
The cost accelerates at lower salaries because more years tip from surplus to deficit.
Biggest Levers (Combined)
The base plan identified Kid 2's school choice as the biggest lever. Here's how it interacts with salary:
| Scenario | Kid 2 Out-of-State ($64K) | Kid 2 In-State MO (~$28K) |
|---|---|---|
| Jennifer $130K | $221,856 in loans | ~$112,000 in loans |
| Jennifer $155K | $143,196 in loans | ~$33,000 in loans |
| Jennifer $170K | $105,132 in loans | ~$0 in loans |
At $155K + in-state Kid 2, loans drop to ~$33K — manageable without major lifestyle changes. At $130K, even in-state Kid 2 still requires ~$112K in loans.
Key Takeaways
-
$155K is tight but workable — $38K more in loans vs. current, repayment goes from $1,400 to $2,150/mo. Manageable if Kid 2 picks a moderately priced school.
-
$130K fundamentally changes the picture — loans needed in ALL 5 years, $3,340/mo in repayment, and total cost of borrowing nearly doubles. Would need to rethink emergency fund timing, loan paydown, or discretionary spending.
-
Kid 2's school choice still matters more than the salary change — the difference between out-of-state and in-state for Kid 2 saves $100K+ at any salary level.
-
The overlap years (2028–2031) are the constraint — two kids at $64K each overwhelms cash flow at any salary below ~$256K. Reducing one kid's cost is more effective than marginal salary gains.
-
If $130K is on the table, consider:
- Reducing/pausing the $1,500/mo extra loan paydown during college years (saves $18K/yr)
- Trimming discretionary by $500/mo (saves $6K/yr)
- Strongly steering Kid 2 toward in-state options