You can’t be astonished that 17 year old kids don’t understand how lending works. Many of their parents give up “free” money every year at work because they don’t participate in the 401K match (you put in 6% of your salary, your company puts in 6%… how is participation in these programs NOT over 95%?). Many of their parents buy insurance on small losses that they could easily cover (laptop, extended warranty on a camera) and go without catastrophic insurance - life or disability. Many of their parents “buy” extra dental or vision policies-- without ever doing the math to realize that in many cases they are spending an extra $800 a year for $600 coverage (how is that a good decision?).
Financial literacy is absymal in this country- realizing that teenagers don’t understand how a loan payoff calculation operates is the tip of the iceberg.
One of the members on my team at work (kid in his 20’s) uses the cash machine in the lobby of our building, despite the fact that it charges him a dollar a transaction, and his own bank has a cash machine which is about 60 feet away. His contemporaries have pointed out to him that he’s paying lots of money a year to avoid crossing a street. His answer? “it’s only a buck at a time and I can afford the buck”.
Doesn’t anyone teach their kids finance and budgeting skills anymore?
Modern American culture doesn’t consider it ethical to discuss what you can or cannot afford. It looks like you always have to put on airs and pretend that you can afford everything, well, at least not less than your neighbors.
It was another big cultural shock for me.
When I tried to talk to my daughter’s HS counselor about college finances she refused to do it, said that it was personal and not allowed. I was lucky I started to read this forum so many years ago and attended all HS graduation ceremonies since 8th grade to collect booklets, where they listed all colleges and all the scholarships students got, to find out about our options
When my daughter signed her employment contract she asked her future co-workers how much money she actually was going to get after taxes, insurance etc. She was told they were not allowed to discuss personal finances. It was confidential. They even did not tell her about existence of online salary paycheck calculators (probably did not know themselves).
And information about salaries and jobs that college graduates get is something that can be only voluntary reported. And you have to spend a lot of time trying to find it on college websites. And of course it is not included in college rank. Why?
60,000 debt and 27,000 a year job? 20% of recent graduates earn less than 15,000 within a year of graduation? Ivy graduates applying for food stamps? Why should colleges advertise this exact information? Nope, they have to put on airs.
Of all the financial bubbles in this country the education bubble is the biggest and the worst. I wonder if there is any space left to blow more air / money or it is ready to burst.
Our state has advisors who are supposed to help families learn about aid and options for paying. After I ran the Fafsa Forecaster (in the days before NPCs,) DH and I met with them. Our initial EFC projection was huge and I thought the gal would explain some options, state aid I wasn’t aware of or some funding D1 qualified for. Here’s what I got, I swear, the words are etched in my memory: “That’s what loans are for.”
I’ve just stopped trying to butt my head up against the wall. D has a friend who will likely not qualify for merit aid and her parents seem very content to send her OOS where she will pay $33K a year. They say they have “the first year covered” and after that they will “make her get loans” (tried to tell them there was a limit but that was not heard apparently). I tried but couldn’t get them to listen. Oh well!
@SouthFloridaMom9 I have a junior on here, and I am interested in your “Thanks to CC we reversed our loose strategy of focusing on “reach” schools and did the automatic merit aid apps first. Then we got started on the match and reach.” What does that mean? How early can you start? He just took his ACT yesterday…and the SAT won’t be until June.
Rolling admissions schools will start taking applications as early as June or July, for the following year’s freshman class. Most open in early August.
Other schools will open apps to next year’s freshmen in August.
Pay attention to the deadlines for merit scholarship eligibility. Even the rolling admission schools have early deadlines for these.
Not to mention the colleges with rolling admissions that don’t have formal deadlines – but where the money runs out. My school is like that; rolling admissions, and no deadline for merit, but the scholarships get smaller and smaller as time goes on. By the end of November or December the generous awards seem to have been given out, and all that’s left are the token scholarships (and ones for specific activities, like FIRST Robotics in HS, etc).
@kikidee9 - you’re in pretty good shape if he pulls in good standardized scores right out of the gate. My son took the ACT in April and June of junior year, then one more time in September of senior year.
We did the automatic merits in August/September 2015, the two priority deadlines due on 10/15, and then a couple more due between 11/1 and 12/1. We just did one with rolling admissions (the university near our house - FAU) and we’re taking a last pass consideration of Renssalaer Polytechnic before their 2/15 deadline. Don’t think it’s going to happen though.
Many of the mid ones required essays and a fair amount of work. For us it was comforting and confidence-building to know that we already had a couple of acceptances/scholarships in hand. I think if we had started the longer apps too early I would have had a hard time keeping my son motivated to do apps.
It’s great timing to think about this now! There is a link that people post here with all the automatic merit schools. Look at UA, UAH, Tulane, Ole Miss (?) . . . there are others too. See if any of those might be of interest. Watch for that link too; I don’t have it handy.
child has dream schools. Run the NPC to cut those which may be out of budget, then set them aside.
have child focus very intently on finding the right “fit” - what in these dream schools make them “dream” and which less selective colleges have these characteristics to a certain extent? Time to buy/borrow the Fiske Guide, Princeton Review’s Best Colleges, Colleges that Change Lives - read with post its. Compare notes.
SUMMER
continue reading/taking notes/comparing + add visits to the match/safety schools.
prepare the commonapp essay
if your child is applying to a highly selective Honors college or UChicago: start on the essays (published in July)
in August, start on the supplements for the safety schools. Have a minimum of 2. (Another advantage: if the first essays need polishing, you’ll have the polished essays down pat by the time to apply to reach schools)
Apply to your flagship/directional honors programs/public instate schools/public colleges where you get scholarships for stats or that are cheaper than your state flagship.
FALL
finish safety applications by September 20-30 and work on match applications that have EA deadlines.
send the safety apps out and prioritize match schools by EA deadline (11/1, 11/15; 12/1) and scholarship deadlines. (Make sure you have a spreadsheet with those - this will help your child keep track of things).
try to get it all done by 11/15
then start on the non-EA match schools’ supplements (at that point the “drill” should be pretty well-known and while many colleges have different supplements there are ways to cutomize once you know what you want to say and what they want from you. Practice makes perfect - your child is getting tired but s/he’s now an old hand at this and pushes through with less effort than many classmates, thanks to the previous months of practice.)
have a nice Thanksgiving
after Thanksgiving, your child can choose how many “dream schools” s/he’s applying to. When supplement burn out happens, let it roll. There are Jan 1, Jan 15, Feb1 deadlines, and in the meanwhile some acceptances should be coming your way, making it more “real” but also more rewarding. With those acceptances, your child feels s/he has nothing to lose and thus feels less anxiety.
MYOS1634-
you and others, have forgotten one VERY IMPORTANT way of increasing a students chances of winning a merit scholarship!- the PSAT test which is taken in Oct of the JR year. That one short test is necessary to be eligible for NATIONAL MERIT scholarships, which are offered by hundreds of Universities ! http://www.nationalmerit.org/nmsp.php
Students should prep for the PSAT during the summer before their Jr year, which can be done easily by taking some practice SAT tests. And parents need to find a school that their Jr can take the PSAT if their HS does not offer it [ many HS in the middle of the country focus on the ACT instead]
If your student does not take that test, they can’t be eligible for a lot of Merit scholarships.
Full pay parents often do not understand the merit process. Yet do not want to pay sticker price.
Many don’t understand the National Merit process and think they can prep their kid a little and bam - NMF!
Some fail to realize their kids want to go to grad school, and misplay their hand and pay for prestige, not realizing there are better merit opportunities available, and save the money for the “prestige” grad school.
A little research can often uncover the chances at a merit award at a school - do they offer 10, 20 or say 100? And how many apply?
And sometimes there is randomness in the process - a talented kid gets rejected from his or her dream school, only then to get a major scholarship from another significant school…
Use the resources out there like college navigator and see what schools merit awards average, what they most often give them for, and whether kids with no financial need are eligible for merit awards…
I really try to provide a little helpful info to parents with their oldest child as they are contemplating college - major and school options within a budget. One parent, who was very receptive, and clearly needed a cost effective route, didn’t realize her DD’s HS had a IB program - and it sounded like her DD was capable. Educated her about dual enrollment, AP courses. Local college options with automatic merit based on GPA and ACT/SAT.
I provided a lot of helpful info to a friend who has a high stat HS sophomore. Since parents are in two states, he has flagship opportunities to compare - one is with full tuition scholarship getting his ACT score up one more point (only took once and scored 29).
I’m sure this has already been mentioned…but getting accepted also does not guarantee that younwillmreceive full need based aid either. The vast majority of colleges do not meet full need for all.
Your FAFSA EFC should be viewed as the minimum the school will be expecting you to pay.
Count me among those who are insanely grateful for the generous combined wisdom, advice, and myth-busting you folks on CC who have already been through the “wars” have contributed here.
It’s a boggling amount of information to digest, like some kind of 3-dimensional chess game. I am so glad I started reading and researching last year, while D was still a sophomore. I can’t even imagine how lost I would feel if I didn’t really start paying attention until spring of next year, but it seems like a lot of people wait that long!!
My DD received a number of large merit scholarships applying EA to CTCL schools this winter. She is a high stats kid, and at “higher” ranking schools, no merit was offered, of course. We are full pay. My DH and I found it quite hard to rationalize paying full price, EVEN IF WE CAN AFFORD IT, to attend school when nearly next to it was 50% off.
Recently another parent bemoaned the CTCL choices as “not good enough” schools. This is part of the problem.
@mom2collegekids - “the parents are self-employed and a bunch of deductions got added back in.”…Yikes. I didn’t realize this was a thing. I guess I’ll be braced for unpleasant surprises in the next few weeks. I’m hoping that S gets some merit aid (not relying on it of course) but the NPC shows he qualifies for need based aid at his more expensive schools and my income is entirely from self-employment.
I commend you for not getting wrapped up in the prestige pricing insanity. I have a business and we are forced to make competitive pricing decisions every single day, how did these schools get to price their product so ridiculously high ? There are very few of them where paying $200,000 for an undergrad degree would even approach a reasonable value. And yet more than 70% have that and MORE as their starting price. I hope more of us speak with our feet and choose the logical cost alternatives.
Posts about the financial savvy of high school kids (or their parents for that matter), the max loan amounts people should take out, the history of grad degrees… all causing the thread to drift off topic. What in the world does professional licensing have to do with this topic? I deleted the ones that drifted the furthest. Let’s keep it on topic, please.