@kelsmom - The loans are provided through the school, so the student does not need to find one!
Some top colleges meet full need without any loans. At others, the amount of loan is kept small. For example, at Williams College, families earning under $75,000 are aided without any loans at all. For other aided students, the maximum loan any student will receive as part of a financial aid package is $4000 per year. The rest of the aid comes mostly in the form of grants, with a small amount from an on-campus job (with a maximum of 8-10 work hours per week).
Only some schools meet need without loans. The suggestion in the article that a student could just get a small loan assumes that need is met without loans. If need is met with loans, the student is not eligible to get additional loan money through the school.
Nope. There are plenty of other private schools besides the Ivy League schools that meet full need and in many cases will end up having a lower net cost than lots of OOS schools.
The title of the thread is not to be scared by the sticker price, to look at all the options. I agree with that. Be prepared to walk away if you can’t make the school work financially, but there are sometimes ways to make a very expensive COA work.
There are times it won’t work, so be prepared to walk.
Imho real issue is about college cost’s dependence up on parent’s income and ability to pay upfront, not up on applicant’s future income or ability to pay back. Parents of 18 year olds aren’t allowed to see their grades or medical records but forced to take loans and drain accounts, if they can’t or won’t then those students are left on their own to deal with the consequences.
If financial aid was focused on making education cheaper for every student and making them able to pay back to system to keep it affordable for others, it would become a self sustaining system. Instead of keeping it as a charity, turn it into a resource to help students become independent and paying it forward.
That makes a lot of sense for public universities – definitely a much better policy and many possible pay-it-forward type options that could be structured by various states. Plus, of course, the basic option of using tax money to fund their universities.
But the so-called “top” colleges are largely private colleges – so I wouldn’t expect to see much change.
How would one know a student’s future income? Not everyone who goes to HYPS is a high earner. Some start out earning high, but decide they hate what they’re doing and change to something they like better even it it pays less. Some drop out of the workforce to raise a family. Some become disabled or die.
Nobody is forcing anyone to do anything. Just as with every, single thing in a child’s life, the parents are the drivers of the child’s experiences. Parents won’t/can’t pay for private HS, kid has to go to local public. Parents won’t/can’t pay for orthodontia, kid has crooked teeth. Parents won’t/can’t pay for music lessons, kid doesn’t get the advantage of music learning. Parents won’t/can’t drive a young child to his friends’ houses, the kid doesn’t get the advantage of socialization. We all are products of our parents’ behavior and the environment they chose for us.
Who in America is forced to take loans and drain accounts? I’d love some data on this.
People take loans willingly. People spend down their savings willingly. No college in America comes to your house and takes away your car or vacuums out your checking account.
I have upper middle income friends who decided they don’t want to pay for college. They have a wonderful lifestyle, multiple homes, travel constantly, and qualify for no aid. They explained the deal to their children- who have figured out various ways to get a Bachelor’s degree. One went overseas. One commuted to a directional state U, lived at home, and took out loans to cover tuition. One is on the slow plan- working full time, living at home, taking two courses (at the directional state U) at night. But he’s got a 4.0 GPA and is on track to finish next year.
Who forces you to drain your account? If that’s a choice someone makes- that’s on them. I know people who make all sorts of strange financial decisions- putting in a $75K kitchen which will boost the value of the home by $30K. Or putting in a swimming pool which local realtors advise has a NEGATIVE return (in some areas, parents with small children are paving over swimming pools, they don’t want the danger or the hassle for the 8 Sundays a year they’d be sitting outside). People buy extended warranties for $300 items even though their credit card already gives an extended warranty for free. People buy trip insurance which most analysts can show is a terrible use of cash.
Etc.
So yes, some people take out loans when they shouldn’t- they have a terrible track record with credit, they are too old to be borrowing for their kids, they have no job security. But that’s not the norm.
@brantly Exactly. There is only one exception to your argument where parents who don’t earn enough to pay but instead of going to community college or local college for merit scholarship, their kids get no loan free rides and prefrence in admission at top schools. Not saying its wrong or right but doesn’t fit with your greater logic.
As far as not knowing future income, if you take huge loans then you pay that back before settling in cozy stress free job of your dreams, just like people have to work to pay back other loans. If overall college tuition is low and whole pool of students oaying back, it won’t take you as long to pay back. For someone dying or being disabled, there can be waiver or insurance to cover that.
The no loan “free rides” to top schools are going only to students who are extraordinarily high achievers, especially when they are coming from disadvantaged backgrounds. It’s one thing for a kid whose parents have invested in their education from pre-school onwards to have great grades & test scores – quite another for a kid who has had to rely on their own motivation and resources while attending local public schools. And it is only at the lower end of the economic spectrum that need-based aid comes anything close to a “free ride” – it really requires a 0 or near 0 EFC to get to that point.
I second @brantly and @blossom! I also think @OHMomof2 was right on target— people in the lower half or middle portion of the nation’s top ten percent tend to mistakenly consider ourselves upper middle class. And yes, barring unusual circumstances which financial aid offices may consider, people at that income level can afford full tuition.
A world without artists, musicians, philosophy and classics and theoretical physics professors, etc. would be a sad world indeed. No students should need to choose corporate law above other less well-paying law fields, or investment banking above being a high school math teacher. There are many talents and interests. Education is about much more than preparation for a job. It is about engaging in ideas and going on to live a fulfilling and meaningful life.
@makemesmart To your point on the cost of universities in the UK, the tuition cost for a UK student is near identical to the in-state tuition at a state flagship like Berkeley or UCLA (~$13K pa). The cost of accommodation in London is not dissimilar either (about another $12K-$15K pa), while outside London it’s a bit lower as it’s cheaper to live there. The international premium in the UK (<$15K pa) is much less than the OOS premium here ($30K+ pa), but that’s about the only difference. And what they aim for in the UK in terms of experience is similar to what you’d get at a state flagship here (i.e. large lectures, less hand holding), except at Oxbridge where the tutorial model is heavily subsidized by the government (and ~$8K pa in extra international fees). So I don’t see a great disparity when you look at the sticker price for public universities, which all UK universities are.
But in the UK, need based aid is not available for tuition costs, almost everyone pays the same price. Here the privates in particular have a high sticker price, high aid model, so different people pay different prices: poor people do better here than in the UK, rich people do worse. For many public instate universities here the poor do better than they would in the UK (though loan repayments there are income based), the rich do about the same. So I think the UC system is probably a bit better than the UK. But you would be more justified in feeling hard done by if the public universities in your state are poor or if the instate financial aid is particularly lacking.
OTOH we were certainly scared away from applying to a number of S18’s top choice private schools (hello Georgetown and Chicago) by the sticker price, and nowhere came close to the vale for money offered by UCLA and UCB.
A new analysis published by the Institute for Fiscal Studies last week found graduates in England left university with the highest student debts in the developed world, thanks to a combination of high fees, increased interest rates while studying and maintenance grants being replaced by loans. It calculated the average student would leave university with a debt of more than £50,000 – rising to an average of £57,000 for the poorest, who borrow more for their living costs. By contrast in the US, famed for its high fees, the average debt on graduation is $36,000 (£28,000).<<<
“UK schools will cost more like 40K a yer for an international, plus flights, visa costs,”
Yes, as I said, domestic fees ~$13K, accommodation $12K-$15K, international premium up to $15K.
And poor kids mostly do worse (get less need based aid) in the UK system than the US. That’s not even taking account of the fact that average salaries are lower in the UK too.
Be happy if you live in a state with a good instate flagship! Sure if you are well off and smart then Oxbridge is a bargain compared to HYPMS. But for most people the grass isn’t greener.
Don’t forget top schools in England only take 3 years to complete an undergraduate degree, and graduation rates will be north of 90%. Not only are US schools absurdly priced but 5 & 6 years to graduate is just ridiculous.
This was not a bad article and I found it to mimic my experience last year going thru the process. If you look at the data, the cost to send one child to college was about equal to the annual family income. So if your upper middle class(so called) with 122K in annual income, your total cost will be around that. So around 30K/year. The scatter-gram shows it leaning closer to 40K/year than 30K but whos being picky. Here in the Boston area, two people earning $60K per year will be hard pressed to pay $40K/year for one child.
To me, that $122K family falls into a deep doughnut hole. They make too much to receive helpful financial aid and too little to afford the $40K needed to attend.
I guess these articles should encourage people to apply to various colleges but I found it is so disheartening to get accepted into a dream school and not be able to afford it. Three or four acceptance letters like that and the process becomes frustrating.
The problem is with the notion of a dream college. When my daughter got her drivers license at age 16, I wanted to get a car for her. But I didn’t go shopping at the Mercedes dealership. I bought a used car for cash in an amount I could afford. It ran, and it got my daughter all the bazillion places she needed to go. But it definitely was nobody’s idea of a dream car.
So why do parents with $122k incomes who don’t have the willingness or ability to fund the dream school even allow their kids to apply? The same kids who have Ivy level chances almost always have good prospects for merit money, and obviously should be able to manage the cost of in-state publics.