“I’m gonna have debt anyways, so the amount doesn’t matter.....” Ack!

^^
True, but no way to force that.

@mom2collegekids Your post #77 about the caste system: this is one of the most true statements ever made on CC. We chased merit money, and my S19 definitely felt the heat for not making a run for the ivies, etc, but based upon NPCs we knew he’d be gapped more than we could handle. Full disclosure: He did apply to Kenyon and was accepted, and he did receive quite a bit from them in the form of small renewable scholarship, but mostly need-based aid that’s subject to change. But we let him apply to one “dream school” because he needed to know if he could get in, and if so, what that would truly look like financially.

When my S19 told his friends that he was going to turn down Kenyon because he had to change his thinking from “return on investment to risk/reward” (too much potential for debt to spiral out of control, for him and for us), his friends’ eyes popped out of their heads in disbelief. But then we’d started these conversations his freshman year, so he was prepared with solid arguments.

He has plenty of friends who were gapped substantially ($40k/year) at places like Emory, etc. They initially panicked but have stayed the course because they’re now too emotionally invested to walk away. They’ve become drunk on all of the atta boy’s and how impressed other people are. My son tried to talk them off the ledge but found it impossible. There’s going to be a lot of buyer’s remorse in that group, especially given that a good number of those kids are Pell Grant kids who applied ED and were accepted, and nobody advised them that it was a bad idea to do that. Despite the “this is unaffordable for us” escape clause for ED that my son shared with those Pell Grant kids, each and every one of them committed. Every. Single. One.

@buckeyeinbama - my kid nagged her friends too :0

We had these early money conversations with our daughter, and later with our foster son. I couldn’t agree more with @mom2collegekids statement.

So many of my daughter’s friends ignored my child - One kid went OOS to University of Del. for a Bio degree, when she had a great offer with merit aid in-state. Another kid went to U.Md. Absolutely bombed the first year grade wise. ONE friend listened, went in-state to Stockton (which offers great merit of late).

Another kid got a full 7 year direct to med school scholarship, but opted to go full price to Princeton instead. Her parents took out a full page ad in the high school graduation newspaper announcing that she was going to Princeton.

My daughter? She was accepted in-state with great merit aid, earned $8,500 in outside scholarships, plus sought out her school’s additional scholarships and earned another $4K. It may have been more, I’ve lost track.

She participated in the inaugural “Degree in 3 years” program and will graduate, summa cum laude and debt free, in May, a year early.

Oddly enough, her college recently realized she had been awarded another scholarship, but they didn’t credit her account, so just sent us $1,500. Crazy.

All her friends have at least 1 or more years to go and lots of debt. We’ll see what happens next…

@NJRoadie More kids need to hear these stories, but as you pointed out, sometimes the parents are just as bad. Full-price for Princeton. Ouch.

Good on your daughter! She’s miles ahead of the game. Your next goal is to make sure she doesn’t marry someone with a ton of college debt. We’ve had that discussion in our house, too.

This is more common than we may realize. I feel for these kids. Your words that they’re “too emotionally invested to walk away,” is soooo true.

Well, if you’re talking about this app cycle, the jury may still be out. Some of these kids’ parents may not know that their child can’t take out loans themselves to fill in the gaps. We’ve seen a number of these kids posting in the summer, desperate, because they didn’t know that they couldn’t take out all those loans themselves.

One area that’s hard to break through is when the student w/o enough funding insists that “where there’s a will there’s a way” and won’t see the truth that they shouldn’t start at a school when they don’t have enough funding.
Recently a parent contacted me about possible solutions for a student who started at an unaffordable school, but had to leave at some point due to lack of funding, and how owes the school $12,000. He’s in a pickle. Even the community colleges are insisting that he provide that transcript before he can enroll.

Heartbreaking. How do you tell a kid that that saying doesn’t apply to situation where a young person needs to come up with a large amount of money in a very short time…and do it again for 7 more semesters?

@mom2collegekids Yes… this cycle. Are you sitting?

One of the families put their house on the market. The parents intend to use the proceeds to cover the gap while they rent an apartment that will be less than their current mortgage. I’ve no idea how much equity they have in their home, and Zillow is estimating just over $190k for a sales price. How accurate is that? No idea. This is one way to go that never crossed my mind. It would terrify me to do something like that.

^^
Wow! But we’ve seen a few who’ve mentioned doing this. I think it’s a cultural thing.

My D took a full ride at our in-state flagship. She wanted to cover her own education if possible and it worked out. She was a top student there and is headed to Stanford in the fall for a fully funded PhD.

@buckeyeinbama Looks like your S19 and my D19 will be classmates at Miami. Well probably not in the same classes as she is a STEM kid.

Our story is much like yours. I have a feeling she has a lot of classmates that are borrowing plenty to go to some schools.

My H had a coworker suggest to him that his plan is to definitely go the loan route because he “foresees” a student loan bailout in the future. Yes, this is real.

It is not always a bad thing, stupid decision, to borrow for college. For some families, it is the big goal to get the kids to the “best” college possible, regardless of cost. It’s what the family wants above all. I know families who moved to where their college kid was going to school so the parental support was right there. I know if families where savings have all been for college. Working multiple jobs are so kid can go to college of choice. This is a personal decision.

I do believe that EVERYONE should be fully informed of the consequences of doing this and they should do the numbers to find out what the future financial ramifications are in making such choices. To do anything blind is not only very risky, but you don’t even know what the risks are.

I agree that if a family wants to sacrifice by selling a house and living in an apartment, that’s their prerogative.

But risking your retirement would be stupid, IMO.

@gpo613 That’s exciting news; so very happy for your daughter! Committing is the culmination of a lot of work and a very long road. Congratulations to her and to your entire family on this next chapter.

If your daughter is into math then they might bump into one another because my son is going to pair his “soft” major (whatever that ends up being…certainly heavy on the critical thinking end of the spectrum) with something like either math or quantitative economics (or something… again, who knows). But yes, if you’re talking about engineering, computer science, chemistry, etc., then they’ll likely never meet. (lol)

But he’s in the UHP and UASP, so he isn’t afraid of the tough stuff. He can keep up. Definitely an egghead… but he follows the beat of his own drum. He’s an interesting cat and a blast to talk to; he’s done a great deal of his learning outside the classroom.

I completely agree. However, I think in some cultures there’s a spoken/unspoken agreement that if parents sacrifice all and therefore aren’t prepared for retirement, that the child will support them in their old age. I think that’s why some cultures really push their kids into very high paying careers.

Can you please share how you have beaten a MIT kid with $100k more debt ?
Here is my math and assumptions:

MIT kid gets $12K more after tax income more in the first job vs my kid going to
UMass Amherst, both going for CS major. 2% raise every year
The entire $12K goes into saving and the entire $100K debt not incurred is also saved.
Both savings earn 7% annualized (my actual returns past 20 years). Yes I know
its significantly below 10.5% return of S&P past 30 year. i.e. returns assume you get
below market returns.

Both options with above assumptions breakeven at age 34. So yes your right
if you buy a house around age 30 your better off.

Over a longer period: At age 50 the MIT grad makes $339K more.

@JJames030

@CourtneyThurston has a job at a a place where there are graduates from elite schools. She works alongside them…same jobs, same salaries. Same company.

Her point is, she did this without assuming a lot of debt…like NONE.


[QUOTE=""]
same jobs, same salaries. Same company.

[/QUOTE]

Are you really sure all employees in the same job have same salary in the same
company. This is not true for any employer I have worked for.

We hired a new graduate from Brown bachelors, 4 years ago
and paid him $10k over other new hires that year.
We had a specific business reason to hire an IVY league grad and were willing
to pay a small premium for sales opportunities in the northeast.

We recently were almost ready to hire an MIT Masters grad with 10 years experience.
The person asked for $58K over the replacement employee we had earlier.
We declined the counter.

I’m sure.

In my experience, salary (even for new grads) for people in the same job at the same company are rarely the same. I’ve hired at 3 different tech companies and between base pay, bonus targets, and stock options (or RSUs), the total compensation varied (sometimes quite a bit). Base pay could vary by 10%-15%, but bonus targets and stock were used to an even greater extent. Who gets more? Depends. For new grads, the ones who had depth in specific areas of interest always commanded more. Also, new grads with with multiple internships where they used specific skills we needed. I must also say, that new grads that simply asked for more were sometimes given a little bump (especially if most of the interviewers liked them). Additionally, outside the hiring staff and manager circles, no one really knew what anyone else was making (base + bonus + stock).

Why is it always that these reasonable discussions are turned to the MIT and Princeton vs the world debates.

If you are fortunate enough to be admitted to these schools. Congrats and fund the education as you see fit. You’ll have a lifetime of opportunity and bragging rights for whatever that is worth.

On average you’ll have a leg up starting a very long professional marathon. Many stay out in front and many get caught from behind. Metaphorically speaking.

However with 1.7mm American students per year considering their options, can we leave the 1200 of these students to the side for a moment. They are a statistical rounding error in the dialogue.

The mistakes are not confined to the Caltech/MIT engineers or Princeton Econ majors on Wall Street. They account for even a smaller percentage of the 1200.

Flagship honors programs should be an automatic “yes” outside of these tiny numbers of students at the top 5 schools - - if significant debt is incurred. Even then it is problematic.

If you are full pay and have the funds, all options and considerations are valid.

If you have merit to an excellent private and can afford the gap, same option set.

If you have great financial aid and the numbers work. Same.

If you have to take on a modest amount of debt and the numbers work comfortably. Go down any path as well.

If you are talking about life altering parental or student debt. Nope.

You can add in the super elites to that equation as well for me.

No retirement and/or a monastic lifestyles - no way.

Life is not a dress rehearsal, you should not be an indentured servant to an institution of any kind. No matter how proud it makes you feel, it’s an illusion.