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Old 02-17-2011, 11:41 AM
Status: "Even better than okay" (set 7 days ago)
 
Location: Coastal New Jersey
51,182 posts, read 50,480,930 times
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Quote:
Originally Posted by katestar View Post
[SIZE=2]I know this my seem like a weird question, but I don't see how it makes sense to pay $40-50K a year for an undergrad education. Where we come from college is free, so my mother did not understand paying for college. When I went, I chose a cheap school and she gave me about $500 a month to cover expenses. I worked all summer, entire 14 weeks, 60 hours a week to have spending money during the school year. I graduated with $20K in student loans and an undergrad degree.[/SIZE]
[SIZE=2][/SIZE]
[SIZE=2]When I have my kids, unless they are passionate about something or really have an aptitude, I would say go to state school or community college until you figure out what you really want to do. I would have them work to pay expenses and I would cover some of the expenses as well. I'll leave the Ivy League out of it, but is school name really that important for most professions? In accounting, they don't really look at your school, they look at your experience and certifications. I k now law school, med school and prestigous MBA schools don't apply here.[/SIZE]
[SIZE=2][/SIZE]
[SIZE=2]My brother made a big stink that it was my mother's duty to pay for his college and she shelled out $14K a year for him to go to a $45K a year school. He has $70K in loans, but did get a job right out of college making $50K. His field is engineering. I figure if he did engineering at UCONN (where he got a full ride), he would be doing the same thing.[/SIZE]
[SIZE=2][/SIZE]
[SIZE=2]Is my thinking this way because I see so many college grads with debt up towards the 6 figures with a job paying $30K a year?[/SIZE]

See the bolded/underlined. That is why I pay for my daughter's college.

I agree that if you are just going for something general or are unsure about what you want to do, a community college or cheaper solution is a good idea. State school isn't necessarily cheap. Here in NJ, our state university (Rutgers) is around $22K per year with room and board. My daughter is at a SUNY, which is around $27K per year for her as an out-of-state student.

She is taking up some of it in her own loans, and her father and I (divorced) are each splitting the rest with our own loans. Neither of us went to college. She is smart, not a partier at all, dedicated to her studies and has a talent for what she is doing (languages). It's worth it to me to go into some debt to send her off in life in a good direction.
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Old 02-17-2011, 11:52 AM
 
Location: West Orange, NJ
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Quote:
Originally Posted by katestar View Post
I agree with all of you, but I think there is a a difference between community college or state school and $40K a year for private school.
there really seems to be 2 questions being asked:

1. why do you pay for a child's college education.
2. is it worth it to pay more for one college vs another.

to answer # 1....my wife and I will help out with college however we can, after we've allocated enough for savings, expenses, and retirement. Whatever that leaves, we'll help with.

#2...it depends. Is a name really important? You say for accounting it doesn't matter, but yet take a look at the population of employees at the Big 4 accounting firms, especially in NYC, and you'll see a lot of the same degrees in their credentials. My college's career services department more than made up for my college tuition cost. Very few students are left searcing for a job halfway through senior year because of the programs run by the career services. Engineering degree, I'm pretty sure it matters. An MIT grad is going to go further easier than a local community college grad 99.9999% of the time. Whether I believe an education at MIT is better than the local community college or state school is irrelevant, because the people that hire believe it, so it's true. Sure, some majors could go anwhere, but it's no coincidence that certain schools are known for certain majors.

also - look at rankings like kiplinger's and money's "best values" in state and in private schools and you'll find that often schools like Princeton have such large alumni involvement that the sticker price is almost never actually charged to students that attend. non-loan aid is highest at most of the private colleges/universities.

everyone has their own opinion on whether or not it's worth paying for a private school vs sending to the state school. To me, the bottom line is you *could* end up in the same place whether you go to Penn State or University of Pennsylvania Wharton School, but it's going to be much more likely for the grads at UPENN than the grads at PSU...(sorry to pick on PSU, they have a great business program, just using it as an example since i'm from PA).


Quote:
Originally Posted by cynderella View Post
Financial advisors say to save for your retirement first and your kids education second. Community College followed by State College is a great and smart way to go if you don't have a scholarship, grant or any other help. Recent studies have shown that in many ways, that high tuition for Ivy League schools helps to pay for the teachers and expenses but doesn't necessarily guarantee a top notch education.
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Old 02-17-2011, 12:07 PM
 
Location: West Orange, NJ
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Quote:
Originally Posted by TurtleCreek80 View Post
1. Very few people pay "sticker price" of $40-50k per year for undergrad. For example, I think Harvard's tuition & fees is a bit over $40k per year, however the school is FREE for any student whose family makes < $60k per year. Family's between $60-180k income are asked to pay approx 10% of their salary towards education. Only families making $200k++ are paying the full price. Only 30-something% of Harvard students graduate with ANY debt and the average debt load is around $10k.
Of course, Harvard offers the most generous tuition assistance plan, but many good students will find that private schools are MUCH better at meeting aid needs via grants & scholarships (vs loans) than public schools.

2. If parents CAN and WANT to pay for their kid's college, they should. If they can't (ie, it would mean taking out parent loans and not funding retirement), then they shouldn't. Easy as that.

3. The parent should ALWAYS help the student navigate the college decision- help research pay & job market for subjects/ majors the student is interested in and keep the debt load (if necessary) in check with anticipated starting salary.
Good rule of thumb is debt load shouldn't be more than starting salary to keep the payments manageable (ie, want to be a teacher? No more than $40k in loans for a starting salary in the $40's. want to be in public relations? No more than $15-20k in loans for a $20-25k starting salary. want to be an accountant? NO more than $50k in loans for a Big 4 starting salary in the $50's.) If student has dream to move to NYC or some other ridiculous COL city after graduation (as I did!), I would recommend taking out no more than 50% of the starting salary in loans ($20k for teachers, $7-10k for PR, $25k for accounting).

I can't comment on your brother's college choice or your parents decision to pay, other than it was their decision to make and hopefully it didn't put their retirement of track. If they could afford private school & wanted to pay for it, so be it.
all very valid points, but not sure i'd be as strict on the starting salary vs debt. it really depends on industry and growth prospects and the child's financial savviness. I'm in "IT Audit" and worked for not a Big 4 in NYC, but the 5th largest firm. I started at around $50k/yr, and graduated with $63,000 in loans and capitalized interest. the monthly payment is around $400/month. i managed my monthly expenses from the start, and lived quite comfortably with going out to bars and restaurants regularly and buying a lot of things when I wanted. so i think it's pretty easy but I know not everyone is financially savvy...
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Old 02-17-2011, 12:19 PM
 
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We split 50/50 what was left after scholarships/financial aid/grants etc....they both graduated with about $20K in debt. Grad School was on them alone. My oldest got a free ride and my youngest got about 80%.
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Old 02-17-2011, 12:25 PM
 
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Quote:
Originally Posted by bradykp View Post
all very valid points, but not sure i'd be as strict on the starting salary vs debt. it really depends on industry and growth prospects and the child's financial savviness. I'm in "IT Audit" and worked for not a Big 4 in NYC, but the 5th largest firm. I started at around $50k/yr, and graduated with $63,000 in loans and capitalized interest. the monthly payment is around $400/month. i managed my monthly expenses from the start, and lived quite comfortably with going out to bars and restaurants regularly and buying a lot of things when I wanted. so i think it's pretty easy but I know not everyone is financially savvy...
Agree, that's why I just said it was a good "rule of thumb"....and because OP was in disbelief that some students take out $100k of loans for a $30k career. The key is to just be realistic about the starting salary and what the post-college monthly budget will look like after rent, car expenses, loan payments, etc.

Take this lovely NY Times article, where the girl had graduated from NYU with $100k in loans and NO job leads in her field of study FIVE YEARS AFTER GRADUATION.

Here are some "gems" from the article & a link if you want to read the whole thing:
How could her mother have let her run up that debt, and why didn’t she try to make her daughter transfer to, say, the best school in the much cheaper state university system in New York? “All I could see was college, and a good college and how proud I was of her,” Cathryn said. “All we needed to do was get this education and get the good job. This is the thing that eats away at me, the naïveté on my part.”

She recently received a raise and now makes $22 an hour working for a photographer. It’s the highest salary she’s earned since graduating with an interdisciplinary degree in religious and women’s studies. After taxes, she takes home about $2,300 a month. Rent runs $750, and the full monthly payments on her student loans would be about $700 if they weren’t being deferred, which would not leave a lot left over.

http://www.nytimes.com/2010/05/29/yo...pagewanted=all
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Old 02-17-2011, 12:34 PM
 
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They way my parents and my spouse's parents see it is that when they die, we're not going to get any money or inheritance, nothing. Instead, they will pay for our education and that could be an invaluable inheritance, tools for us to build our own future loan free. Not all schools are designed the same - that would be the difference between a job or a career. At the same time not having the most expensive education necessarily means you have the best of the best, not true either. Research the degree you want to reach and try to find the best school money can afford.
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Old 02-17-2011, 12:48 PM
 
Location: West Orange, NJ
12,542 posts, read 17,725,661 times
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Quote:
Originally Posted by TurtleCreek80 View Post
Agree, that's why I just said it was a good "rule of thumb"....and because OP was in disbelief that some students take out $100k of loans for a $30k career. The key is to just be realistic about the starting salary and what the post-college monthly budget will look like after rent, car expenses, loan payments, etc.

Take this lovely NY Times article, where the girl had graduated from NYU with $100k in loans and NO job leads in her field of study FIVE YEARS AFTER GRADUATION.

Here are some "gems" from the article & a link if you want to read the whole thing:
How could her mother have let her run up that debt, and why didn’t she try to make her daughter transfer to, say, the best school in the much cheaper state university system in New York? “All I could see was college, and a good college and how proud I was of her,” Cathryn said. “All we needed to do was get this education and get the good job. This is the thing that eats away at me, the naïveté on my part.”

She recently received a raise and now makes $22 an hour working for a photographer. It’s the highest salary she’s earned since graduating with an interdisciplinary degree in religious and women’s studies. After taxes, she takes home about $2,300 a month. Rent runs $750, and the full monthly payments on her student loans would be about $700 if they weren’t being deferred, which would not leave a lot left over.

http://www.nytimes.com/2010/05/29/yo...pagewanted=all
i'll have to read that in more detail later, but i just skimmed it and i saw the degree and i wonder...what did she think she'd make when she graduated? i know maturity levels at 18 differ from one to another, and i get the parental pride comment in the article, but to villify the school for helping connect her with methods of paying tuition is just wrong. she obviously didn't qualify for much financial aid for some reason (this is generally based on assets), and she went to school to get a degree in religious and women's studies and thought paind around $40,000/yr for that was a good idea?

sorry, i just don't like this subprime comparison. this story is the exception, not the rule. look at stats about earning power for a college grad, especially NYU. i dunno......
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Old 02-17-2011, 12:52 PM
 
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Going to a good college and getting a top notch education is an investment that pays off, but not immediately, of course. Sometimes it takes 10, 15, 20 years.

In my first job I made $14k. Next job, 16k. Next job, 25k, and so on.

I went to a small, private college and have had an excellent career. My brother and sister are also quite successful with the same educational background. The friends I made in college are, without exception, doing what they want to do in life. I have friends who are attorneys, actresses, business owners, social workers...they all found their strangths and went with it.

(Interestingly, they are all women, because I went to a women's college.)

One thing we have in common is that we got liberal arts educations and learned how to write, how to learn and how to capitalize on our talents and strengths.

This sort of education is a gift my grandmother gave my mother, my mother gave me, and I am giving to my daughters. It is a family tradition I guess you could say.

How can I afford a private college education for my children as a single mother?

Two answers:

1. A $50k tuition does not cost $50k. No one pays retail for a private education. Thanks to FAFSA, colleges know just how much you can afford, and colleges make up the differences if they think you are right for their school. Simply by filling out the forms, my daughter's college knocked off half the cost. We have pursued every scholarship we can and as a result, her education is costing only slightly more than the state college.

2. Even more important, *I* got a good education, which I parlayed, over 25 years of work, into a well paying career that allows me to pay this tuition.

I anticipate that the circle will continue and my daughters' children will carry on the tradition, if that is what they want.
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Old 02-17-2011, 12:57 PM
 
11,671 posts, read 21,231,508 times
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Quote:
Originally Posted by bradykp View Post
i'll have to read that in more detail later, but i just skimmed it and i saw the degree and i wonder...what did she think she'd make when she graduated? i know maturity levels at 18 differ from one to another, and i get the parental pride comment in the article, but to villify the school for helping connect her with methods of paying tuition is just wrong. she obviously didn't qualify for much financial aid for some reason (this is generally based on assets), and she went to school to get a degree in religious and women's studies and thought paind around $40,000/yr for that was a good idea?

sorry, i just don't like this subprime comparison. this story is the exception, not the rule. look at stats about earning power for a college grad, especially NYU. i dunno......
Agree. But the "exceptions" are out there crying to the media about college being "useles" and being "exploited" because they just didn't understand.....whah, whah, wha. And us "rules" who are well-employed and making much more money than we would have without a degree just don't make a very good article subject for the NYT or any other media outlet.

Blaming the college or the lenders is just a way to skirt around any sort of "personal responsibility." If you're old enough (parent OR student) to sign on the dotted line to take out NON-DISCHARGABLE student loans, you should be old enough to understand repayment terms and job prospects.
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Old 02-17-2011, 01:07 PM
 
1,302 posts, read 1,529,167 times
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Quote:
Originally Posted by TurtleCreek80 View Post
Agree. But the "exceptions" are out there crying to the media about college being "useles" and being "exploited" because they just didn't understand.....whah, whah, wha. And us "rules" who are well-employed and making much more money than we would have without a degree just don't make a very good article subject for the NYT or any other media outlet.

Blaming the college or the lenders is just a way to skirt around any sort of "personal responsibility." If you're old enough (parent OR student) to sign on the dotted line to take out NON-DISCHARGABLE student loans, you should be old enough to understand repayment terms and job prospects.
You should also have a mother that tells you that when you go to NYU you don't major in Religious and Womens Studies.
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