Financing choices?

<p>What does a job with a degree in environmental sciences pay? Will your daughter be able to pay off her loans and pay for food, housing, etc.?</p>

<p>Blossom, great post. We pretty much borrow what we have saved for our kids college. So it comes down to savings, current income and loans for us and for our kids.</p>

<p>*Guess what- a borrowed 80K costs a lot more than a saved 80K. My sister kept telling me, 'well we would have saved it but last month the brakes on my car went, and the month before the compressor on the refrigerator died… etc."</p>

<p>Hey- you’re still going to want a car with safe brakes once your kid goes to college. And presumably you’re not going to want to come home after work and see melted ice cream on the kitchen floor either.*</p>

<p>Bravo!
Bravo!
Bravo!</p>

<p>This is why I don’t understand when people will borrow lots of money for their kids’ college (especially if there are younger sibs to put thru as well). If your current income is now going to living expenses and all those crazy/annoying unexpected expenses (car repairs, appliance replacements), then that’s always going to happen. You’re not likely going to magically have an extra $1000 per month (EVERY MONTH!!!) to put towards loan payments for 10 long years.</p>

<p>I don’t see why borrowing lots of money for an “ok” private is worth it. Can’t this same degree be gotten at a local state school?</p>

<p>MomfromKC I’m hoping allot, it seems she will need graduate school to get a $80/$100,000 job down the road.
Blossum that sounds great for a start, I think we’ll do that this weekend.
Waverly if would be different if it was a boy, but it’s my little Girl, lol. I see your point, but there’s not a LAC in the state under $38,000. E-town fits her very well.
Steve yes she works now and will work in college, we will tell her what her part of the money this weekend also.
Thanks so much guy’s</p>

<p>Will she be commuting to this school?</p>

<p>If so, then as I wrote in your other thread, I don’t think you need to borrow that much.</p>

<p>Posted in your other thread…</p>

<p>"If the D will be commuting, and the $20k is all scholarship (free money), then it seems that with some thought, you (the parent) won’t need to borrow $80k (which is way too much).</p>

<p>If your D takes out a 5500 loan that she’s responsible for, and she earns some summer money to put towards college (maybe 1500), and you contribute $6k per year out of current income, then you’d only have to borrow about $7k per year. That’s much better."</p>

<p>Obviously, the amounts that I indicated that you would pay out of current income could be more, leaving you with even less to borrow. Since we now know that this is an only child and you and your spouse both work good jobs, then it would seem that coming up with at least $10k per year from the parents would mean that you’d only be borrowing about $5k per year. It’s much easier to pay back $20k than it is to pay back $80k. lol</p>

<p>*MomfromKC I’m hoping allot, it seems she will need graduate school to get a $80/$100,000 job down the road. *</p>

<p>Down a long run maybe she’ll earn that much. But I doubt an Environmental Science degree (even with a grad degree) will earn that much for awhile. And unless she’s in a PhD program, she’ll could have debt for grad school as well.</p>

<p>If your child is planning on grad school, there will be MORE debt on top of the $80K. That’s a ton of debt and there are a lot of unemployed & underemployed folks in environmental science. I think if you ask what folks in Environmental Science are earning, you’ll find many may be in public service/non-profit jobs that are close to $30K and up.</p>

<p>We had our D start in CC & then transfer because it’s just too much debt. We were able to pay for her college out of limited savings, cutting back & me earning more so that we didn’t have to take out loans for her degree in cinema (where she may have to go on at some point to get a degree where sne can support herself).</p>

<p>“Hope” won’t pay bills. It’s much better to realistically calculate how bills will be paid before jumping into a situation where you and your kid will be saddled with crushing debt and have to transfer before the kid even gets a degree. Is there an in-state U where your child can get a degree at a lower cost & then go to grad school? That could be a HUGE savings!</p>

<p>jknmcd–sorry, but she has no idea how much she will have to contribute to school yet? I realize that this is a learning process for everyone but finances should have been discussed before she even started applying or visiting schools. Our kids know exactly how much we will help with, and I think that is pretty much the case for most parents here on this board. That doesn’t mean they are restricted to schools in that price range but they are aware that if the merit aid doesn’t come through at one school they can either take out more loans themselves or move on to choice #2.</p>

<p>One example, our S is looking at an expensive reach school. We have told him all along if he gets in, great, if the money is there, you can go there. I was talking to D about colleges over the weekend and just reiterating that 4 of the schools she is considering she has a much higher chance of getting pretty close to a full ride then her #1 choice right now. She said that we will “pay” for S’s school-I told her no. I outlined that S’s school meets 100% of need and how, based on current calculations for our EFC how that may work in our favor bringing the cost of that school down into the “acceptable range”. We have money talks all the time.</p>

<p>I think it’s time to sit lay it on the line for your DD. Is this the only school she applied to? What are her other choices? What kind of aid did she get there?</p>

<p>Steve, like I mentioned before we can pay for the college, I just wanted to hear how people were doing it, the best route. Everyone here has been so helpful, I am so much more ready to get started with this then before. Our plus is we only have one child which we will be paying for, my hats off to anyone with more than one, that I couldn’t do.</p>

<p>Here is the cost of some very good local state schools where my D would maybe get $5000 in scholarships and an average LAC school that is paying for half. So for us that extra is worth the small class size and student professor relationship. The cost difference is not that much. She has gotten pretty much the same $ from all the schools she applied to, half her tuition is scholarships. </p>

<pre><code> Millersville University Penn State University Park 4-year Private College
</code></pre>

<p>Tuition/Fees $8,361* $15,984 $30,474
Room/Board $8,732 $9,420 $10,273
Total $17,093 $25,404 $40,747
Cost over 4 years $68,372 $101,616 $162,988</p>

<p>Boy did that get jumbled up, lol</p>

<p>JKN- I get that the cost differential in 2012 dollars doesn’t seem that huge. (Hey, someone who works for me drives a 45K car and I’m the only one who blinked at the price tag!)</p>

<p>I think what posters are trying to communicate is that spending 80K on something when you are sitting on 80K in the bank is a different economic decision from borrowing 80K and then paying it back. You spend your own 80K there’s just the opportunity cost- what you would have earned had you invested in Procter and Gamble stock, a mutual fund, T-bills, etc. But you incur no other costs by spending the money you’ve already saved.</p>

<p>You take out a loan for the 80K, you’ve got both the interest costs, fees, plus you incur risk- risk that if you are disabled and can’t work, you’ll need to find another way to pay back the loan. Risk that if your D drops out of college without a BA and decides to go to culinary school, you’ll want to help her pay for culinary school PLUS you will STILL HAVE TO PAY BACK THE LOAN. The loan calculators are helpful in one sense- they show you how easy it is to pay back that loan every month. What they can’t help you do is to figure out how a family that didn’t manage to put aside enough money to pay for college ahead of time, can figure out how to do it after the fact.</p>

<p>I’m not blaming you- few people can save enough to cover the entire nut. That’s what financial aid is for, that’s why merit scholarships are so wonderful. But before you conclude that the difference between public and private are “not that much” you need to look on a cashflow basis for the next 10 years the impact on your family, your ability to save for retirement, etc. And plan B- if your D changes course professionally, decides she hates her major, needs a 5th year to finish her degree… how will the money work?</p>

<p>Thanks everyone I think I am good here. You all have been a great help.</p>

<p>… … … Millersville U… Penn State UP … 4-year Private College
Tuition/Fees … $8,361* … $15,984 … … $30,474
Room/Board … $8,732 … …$9,420 … … $10,273
Total … … $17,093 … …$25,404 … …$40,747
Cost over 4 years $68,372 … $101,616 … … $162,988</p>

<p>So, it does look like the student will NOT be commuting. </p>

<p>In another thread, you mention that your D will be attending Elizabethtown College. I’m not sure that you have the tuition correct. </p>

<p>On E-town’s website, it lists that tuition is:</p>

<p>Tuition $36,550 (tuition, room, board is $45,600…not including books, travel, personal expenses)</p>

<p>That increases that $160k total to $180k…and doesn’t include year to year increases.</p>

<p>Steve…I know what you are saying, but HELOC at 3.5% over non sub loan at 6.8% is a no brainer for me.</p>

<p>If you can get the HELOC.</p>

<p>geeps20–what if the T-Bill rate skyrockets and you are paying 12.9% for that HELOC in 3 years??</p>

<p>Mom2collegekids, that’s just an avg. for our local LAC’s, give or take 5000/6000. I’ve heard Penn State had a major increase this coming year also. Either way you slice it that is some serious money.</p>

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<p>Glad you can pay for the college! I got the impression from the OP that you were needing to borrow the whole nut that isn’t covered by the scholarship.</p>

<p>We just paid the cash–no loans. By the summer before college, we sold investments that totaled 2 years of tuition, room and board. After sophomore year in college, we sold investments that totaled the remaining 2 years. There is a real comfort knowing that the short term vagaries of the stock market won’t affect your kid’s college graduation.</p>

<p>As for our retirement, though…</p>

<p>By the way, be sure to factor in a 5% increase in costs every year. If you’re lucky, it’ll actually only be 5%…</p>