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@jym626 I know there are a lot of Texas kids at Ole Miss who were given the option of going to SMU or Ole Miss with a nice car. They took the car.
I have been faced with the same problem as the OP for the past few months. My son applied to Tulane in hopes of getting one of the 125 full-tuition scholarships. He didn’t get one, although he got a $32,000 merit scholarship on admittance, which left us on the hook for about $20,000 per year and climbing in tuition. We thought Tulane was a good “fit.” My son also got the free tuition offer from Alabama, an OOS waiver plus $3,000 from Georgia, and tuition, room, and board from Ole Miss (where he is currently dual enrolled).
We could “afford” the Tulane tuition, but it would cause some cash flow problems. We told our son that we would want him to take out a $5,500 student loan each year so he would have some skin in the game, and he said he didn’t want to go into debt. I told him if it wasn’t important enough to him to take out a small student loan, I wasn’t sure it was something we wanted to struggle with. So he’s going to Alabama, where we will pay the room and board. The four-year scholarship is good for both undergraduate and grad school, and since he already has about 65 hours, we felt this had real value; and he just didn’t want to stay home to go to school. (At Tulane he would start with only 30 hours).
My daughter didn’t have options that were as good. She got an 80 percent OOS waiver to Arkansas and could have attended LSU at in-state rates under the common market. Instead she’s going to attend the University of Louisiana-Lafayette on a full ride with stipend. Unlike the case with my son, I think this is probably the best fit for her, as I expect it to be a little less high-pressure socially, even if it’s not a big name school.
I did tell my kids that they would enjoy a substantially higher standard of living if they chose the cheaper educational options, and that includes a nice car for our daughter. I also told them that I intended to treat them exactly equally in terms of financial assistance. If one child needs an additional $20,000 per year to go to school we would try to make it happen, but the other child would get more money immediately, or we would ledger it so that the other child will be entitled to a like amount at some point, perhaps for a down payment on a house, and that in any event the ledger would be settled upon my death and the distribution of my assets. My father doled out money based on who asked and who needed it, and I think I probably got a lot less during his lifetime, and I told them that wasn’t going to be the case with them. I think the knowledge that what they choose to spend now would affect how much money they would have in the future made an impact.
Am I 100-percent satisfied with our decisions, particularly for my son? Nope. But Tulane was going to end up costing about $100,000 more than Alabama. I’m just not sure a “better fit” is worth $100,000. In the end, he didn’t think so, either.
These are tough, and personal decisions. I personally find it unpleasant to dangle a brand new car in front of a teenage kids’ face, and to me (and yes this is my personal issue) I value education more than a car. Of course one can get a very good education at many different schools, but to me the message of “I will dangle a nice car in front of your face if you take the cheaper school” sends the wrong message. But hey, that’s just me. Many teenage kids will not have the skills in place to truly weigh this decision and its implications. Many do, but many don’t.
Congrats on all the scholarship options. The top automatic scholarship is great at Tulane, but it does leave bigger out of pocket costs. What happened with the Altman? If that had come through, would that have changed the decision? Its hard to weigh the “value” of these opportunities. I concur that having to take out loans if it is avoidable is the smart choice.
Our s’s paid a family member to buy her old hand-me-down cars. So they had some skin in the game but also chose to drive older cars. DS#2 drove his older car until just last year, when it it was about 13 yrs old and falling apart. The car alarm going off in the middle of the night finally helped hasten the decision. Then, when it was time to buy a replacement, he chose a smaller, used car, and paid cash. I think he has learned how to prioritize.
@EarlVanDorn just wanted to say I could have written exactly your post about Tulane last year. My D got same 32k, when hoping for the full tuition. She had full tuition (and more) elsewhere. She didn’t want to take the student loans, so off she went to Pitt where she’s had a good year. Honestly I still feel Tulane would have been a better fit, but we couldn’t justify the money,especially factoring in expected tuition increases.
In addition to her, I have 2 more kids and I didn’t want to set an example for them that would be unsustainable.
Totally agree about assessing value. We told younger s we had earmarked the same dollar amount as we spent on older s’s undergrad. He argued for a COL type adjustment. But fortunately it became a non issue as he was lucky enough to get a full tuition (DHS) scholarship at Tulane. He was adamant that he did not want to go to the big flagship U, even though it would have been very inexpensive, and when he first got the top auto merit aid to Tulane in the early fall ( I think it was around $27k back then) he refused to apply to any other safety’s.
We lucked out that he ultimately got more $, but we had accepted the decision to let him go even if he hadn’t gotten the additional scholarship. He applied to the DHS and the community service scholarship. Back then it would have cost something like $23k or so a year with the first merit award and NMF money. We decided that was a reasonable value. Would we have paid full pay for Tulane? No. As an aside, he ended up changing majors to something that at that time wasn’t offered at our flagship U nor at his second choice school.
I am the OP to this thread.
If anyone thought I was trying to humbly brag, my apologies. Nothing could be further from the truth.
Also, sorry for the poorly worded title. I was probably trying to be clever rather than provocative.
I was merely reacting to a decision we had made last week and was probably more inclined to just vent rather than express opinion or worse, lecture about how anyone should best invest their funds for their particular situation.
I haven’t posted again on this thread as I was enjoying everyone’s input (and am appreciative of their thoughts). I also like to know that in the end, we are all in the same boat.
We will do what we feel is best for the people we most care about in our lives.
In our personal experience, my daughter is happy with her decision. Would there have been other, better options. That will always be unknown. I can only hope that the option we have put her on is the path that will hopefully have the best fit.
thank you all for your honest sharing. It is the one thing I most enjoy on this forum.
Yes, our S had a few schools that would have given him as a NMF a full ride. He chose USCal, where he received > 1/2 tuition for 4 years. Fortunately it worked out for him. We didn’t foresee that D would want to follow him there and end up transferring there where we paid full freight to 3.5 years–ouch! Fortunately, we were able to have both graduate debt-free.
We’re with you. Kid needs “skin in the game” I had the talk with S18. Told him we were able to pay 20K out of pocket each year. We could pay more. He doesn’t have to know that. Told him the first 5K after my 20 comes from him getting a federal loan, then from summer earnings.
It will motivate him to apply for as many outside scholarships as possible. It will make him grab more summer shifts instead of sleeping in.
@jym626 My son was going to seek the Master’s of Accountancy degree from Tulane, and was told students in this program were not eligible for Altman. Apparently there are issues of being able to complete both programs, as they have overlapping demands. I think my son was going to start Tulane with either 30 or 36 hours, so I felt like he would have had a head start and could have found a way to do it, but they said it wasn’t possible. He was told he could start as another major and perhaps switch to accounting later, but that doesn’t seem quite honest to me. If he had been able to participate in the Altman with some type of additional aid, it absolutely would have made a difference. I emailed Jeff Schiffman to inquire if any additional merit aid might be available a couple of weeks ago, and he politely told me “no,” which I understand. But if there had been a way to increase my son’s merit aid a little bit he probably would be headed to Tulane in a few months.
I understand your point about “dangling” the car, but I’ve told my kids for years that if they manage to go to school tuition free or cost free that I am going to be very generous with them in terms of spending and lifestyle money, with the caveat that I don’t want to finance their destruction. A decent car is kind of part of that, although my son already has a nice, slightly used SUV that we bought him for his 18th birthday/Christmas/graduation.
Every year we have similar thread, and the reason is no matter whether you can afford it or not, it is a tough decision. The idea of paying 60+K a year (net) is daunting for most people. We all want to give our kids the best, but it also means a lot of sacrifice on our end.
We had a similar situation with D1 when she was given a full merit for a second tier LAC and be a full pay at a top 20 school. I was thinking about number of cars I could buy with money I could save, until D1 asked if she could go to the full pay school and contribute to 25% of the cost. She ended up going to the full pay school, had 4 best years there and landed a great job.
@EarlVanDorn - The Altman is a very unique program with very specific course sequences, summer requirements, year+ abroad, established fluency in another language, etc, so it is unfortunate, but not surprising, that they are not able to be flexible with it, and/or combine it with a separate, 5 year program.
Its also disappointing when the separate application/full tuition (and full ride) scholarships are awarded to others, but as you know, that is the next step at Tulane past the top automatic merit, which your son was fortunate to be offered. I have not heard this year of students getting additional automatic merit money beyond what was initially offered. In past years, some students were sometimes able to get their automatic merit $ upped from a lower to a higher amount if their standardized test scores and/or GPA significantly increased, but this year, perhaps with the presence of a new Dean of Enrollment Management, it didn’t sound like that happened.
So whether it is Tulane or any other school, everyone decides for themselves whether the out of pocket cost of attendance is worth it, and whether the student is (as in @oldfort’s case) or is not (as in your s’s case) willing to contribute financially to their education. The PROFILE schools expect the student to contribute something to their education. This is not unreasonable, IMO.
My kid was in the same situation as @EarlVanDorn this time around. We’re paying for his brother to go to Olin so we told him he should look at where he will be the best fit. Alabama was a nice option, but in the end Tulane offered him what he wanted. I agree with the kids having skin in the game, and they will both have their own loans to pay back when it’s done.
We had the same situation as the OP few years back. I have a full pay Junior at an Ivy and we’re in-state CA, so UCLA/Cal is 1/2 the cost of an Ivy. She was also offered 1/2 tuition merit at USC and 1/2 COA merit at Case Western. I joked that if she decides to take one of the cheaper options, that I will buy her a really nice car. She didn’t take the bait. It was a hard decision to make for us but now that she’s almost done, it was easier (financially) than we originally thought. We ended up able to finance her education using current income without any much change in retirement savings and lifestyle. Also the following contributed to how we were able to do this: 529 savings, outside scholarships, summer/winter/school jobs, savings when she went to study in Melbourne for a semester and hopefully savings on her last semester (pro-rated tuition).
I’ve talked about opportunity with my kids since they were five. Call me a geek. The opportunity cost of a piece of cake is ice cream. You choose one and give up the other. We moved to discussions of opportunity cost with time and money. For college, set a max budget and did not apply to schools above that price based on each school’s NPC. We ended up turning down substantial merit but not hitting our max budget either. Daughter also is responsible for $4,000/year to have skin in the game. She can earn it or borrow. Her choice.
There was always a preferred school (she was rejected) but never a dream school. Our safety changed late when we all agreed that the safety school was not a good choice and we found another option with late applications and substantial merit. I recognize all people can’t do that.
@jym626 I’m not complaining, just wishing. On paper I am somewhat wealthy; my cash flow just sucks eggs. Two-thirds of my net worth is in trust and the rest in real estate that I’m not willing to sell at fire-sale prices. My children were supposed to have a very substantial educational trust fund on my dad’s death, but due to some marital issues my dad emptied his estate completely, and I couldn’t show up in court claiming dad was “forgetful.” In the long run it was very much to my benefit, but it did not help with the children’s college, and of course we never saved a dime for it.
My cousin has a good friend who has won the Ohio lottery twice; the first time he split a four million dollar prize, and the second time he won $18 million. The thing is, the guy was already rich. My cousin tells me that some people in the community were kind of upset that a really rich person won the lottery, much less twice. I live in a small town where lots of folks are struggling, and I dare say there are plenty who feel the same what about my kids getting free tuition or a full ride ANYWHERE, Tulane or otherwise. They aren’t sitting around like they do in the movie “Cider House Rules” saying, “Let us be glad for Earl!”
I am in the real estate business and am just bouncing back from some really bad years. Six years ago Chapter 11 was a possibility as I was horribly over-leveraged. I can see myself being completely free of development debt in a couple of years, which is unheard of for a developer, and that’s the place I’d like to be. If we wanted Tulane badly enough we could pay for it, but we have other priorities. Ultimately everyone has to decide for themselves, but I’m lucky to have had options that most parents do not in terms of free or discounted options, so no need to break out the violin music for me.
^ “and of course we never saved a dime for it.”
This is a good point. Starting to save for kids’ educations, particularly using tax-efficient structures such as 529 accounts will just give parents more options when the kids reach 18, due to the time value of money, ability to take on riskier investments due to the long-term time horizon, etc. This is particularly true for us baby-boomers many of whom (myself included) took some financial hits during the Great Recession. Obviously, I realise that many parents don’t have the ability to save when their kids are small but if they do, it can make a big impact in their kids’ university choices.
We used some of older s’s EE savings bonds that he’d gotten as gifts to pay for his senior year. He had to be the one to go to the bank and cash them in. So to that degree he had skin in the game. He was going to apply to be a manager of the girls’ swim team that would have offered a large tuition break, but it was his freshman year (and he know nothing about swimming or the commitment involved) so we discouraged that. But he offered.