Save for Kids College or Down Payment on a House?

Opinions may vary on this matter, but consider the following perspective: What if you were to invest in a home for your child when they were a baby, with the intention of paying off the mortgage over 15 years so that it's completely owned by the time they are ready for college? During this entire period, someone else would be contributing to paying down the mortgage, while you would benefit from tax advantages, potential rent increases, and the appreciation of the property. It's surprising that more people aren't discussing this strategy.

Alternatively, if you have already surpassed the stage of having a baby, another approach to consider when your children go off to college, trade school, or enter the workforce is "house hacking." By purchasing a four-bedroom home, your child can occupy one bedroom while you rent out the remaining three. This arrangement eliminates your housing costs during their schooling years. The best part is that since your child is living in the home as their primary residence, you may be able to put down as little as 3.5-5% as a down payment on the property (please consult a mortgage professional to stay updated on current restrictions). Afterwards, you can choose to retain the property as a rental in your portfolio or gift it to your child, giving them a head start in life.

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