<p>My top three choices are Michigan's Residential College, Smith College, or Wellesley College. I visited all of them and felt very comfortable at Smith, a little less so at Wellesley, and out of place at Michigan. I'm not in love with the idea of living in the busy downtown of a small city, but Michigan has some pluses that are drawing me to it.</p>
<p>For one, Michigan gave me a good financial aid package. My scholarship is $10,000 and they gave me loans such that our out-of-pocket payments would be only about $5,000 per year--the most we can afford. At Smith or Wellesley, I'd graduate $60,000 to $70,000 in debt. At Michigan, I could save that money for grad school. I also live about two hours from the campus, so I could come home easily and would also have a lot of friends at the school. I like the Residential College's emphasis on foreign languages, too, and the Quiz Bowl team at the university. </p>
<p>However, there are many things that give me pause. The size of the university is overwhelming. I know there are ways to "make it smaller," including the Residential College, but I'm very concerned about being a face in a three-hundred-person lecture hall. I like one-on-one interaction with professors and abhor the idea of being taught purely by grad students in many of my larger classes. Michigan's curriculum also seems to be fairly inflexible in that I couldn't bounce easily between my potential majors (history or one of the hard sciences), and the dorms are quite depressing. </p>
<p>I don't know what to do. I've weighed many of the pros and cons, and Michigan usually comes out on the bottom. Yet many of the pros are such strong pluses for the university that I keep coming back to consider it. </p>
<p>Is there something I'm overlooking about the university that might calm my worries? </p>
<p>“For one, Michigan gave me a good financial aid package. My scholarship is $10,000 and they gave me loans such that our out-of-pocket payments would be only about $5,000 per year–the most we can afford. At Smith or Wellesley, I’d graduate $60,000 to $70,000 in debt.”</p>
<p>^of course its over 4 yrs.
Anyway, I think michigan is a better choice, though it certainly doesn’t provide the faculty to student ratio you desire. First yr intro courses tend to be really big, but you usually would have discussion sections(w/ about 25 students and a grad student instructor), so you do get some attention there. Classes get a lot smaller when you take higher lvl courses, so there’s plenty of room for development.
Personally, I wouldn’t attend an LAC just for the prof’s attention.</p>
<p>I wouldn’t be attend an LAC just for the attention. I feel like those LACs have more of the commitment to intellectualism that I’m craving. This isn’t to say that Michigan students aren’t smart–quite the contrary. What I mean is that, in generally, LACs tend to place more of an emphasis on learning just for the sake of learning, something that aligns closely with my personal philosophy.</p>
<p>Phanatic, Michigan’s devotion and commitment to intellectualism is as overwhelming as its size. Within 2-3 semesters, you will have mastered the ability to sail through the size and you will realize how much Michigan has to offer. No university is worth a $70,000 debt. Such a debt would require $1,000 monthly payments for 10 years.</p>
<p>However, if you are to enjoy the University, you are going to have to approach Michigan with a open mind. I fear your negative perception of the university based solely on its size is clouding your better judgement.</p>
<p>Alexandre is right about keeping an open mind. </p>
<p>My D, who is in her second year at the RC absolutely loves it. She also had the same worries you do when she decided to go there. Make sure you take a Fred Peters class and you will never look back. You won’t believe how the RC profs go out of their way to mentor students and make amazing opportunities available to them. Please PM me if you’d like to talk to my daughter.</p>
<p>@phanatic, Michigan offers a plethora of amazing opportunities from research, to community involvement and not to mention our bountifulness of over 900 clubs that cater to anything that you’re interested in for that matter. Also, if you want more individual attention, than I would suggest taking some honors classes as they are capped usually with around 35 students or less. Plus most of your math and foreign language courses will have a smaller number of students as well because these disciplines require more individual attention sometimes since they’re harder concepts to grasp relatively speaking. Subsequently, I transferred from a private university(Tulane) to a public institution(Michigan) and honestly at first, the class size discrepancy was bothersome, however I quickly adjusted and realized that it’s no big deal; plus you can make a large university feel like a smaller one too, if you utilize the appropriate instruments. Finally, I’m not trying to influence your decision in one manner over another, but truthfully speaking take everything into account here to assist yourself in making a wise decision.</p>
<p>Best of Luck, Dave! (I am a member of our Quizbowl Team and we rock to the fullest)</p>
<p>phanatic - There are times that we just cannot have exactly what we want, and for you this is one of those times. There is no question that incurring $70,000+ in debt would be a huge mistake. As Alexandre so correctly points out, you would have the equivalent of 2 or 3 car payments before we even start talking post-graduate work.</p>
<p>I understand you will regret not having that LAC experience, but naturally there are experiences at Michigan you cannot get at the LAC, so hopefully on balance it will be equally satisfying to you, just in different ways. If you get there and you really just hate it, tough it out and do well for a year and transfer. It would still be too much debt, IMO, but at least it would be less and you would know for sure that you needed to spend the extra money. Otherwise you might finish 4 years at the LAC and be happy with the experience, but have major regrets trying to pay off those loans. It just makes sense to try Michigane first, and as was said, go in with an open mind and positive attitude.</p>
<p>Alexandre, that is not true. It depends on what you want to do. Since you don’t know what OP wants as a career, it’s wrong of you to make such a statement.
If you want to be a musician or historian or any other low paying career, sure no university is worth 70k in debt, because you will be in debt for a long time.
If you want to be a banker/trader, then it’s definitely worth going 70k in debt to go to a target school, because it’s 10 times harder to make it in from a non-target and the earnings difference is huge, and depending on whether it’s a good year, you can pay off the debt within one or two full bonus payments (not counting stub year)</p>
<p>The way to decide whether you should take on a certain debt for a certain school is simple. Going to college is an pure investment to increase your earning potential for the rest of your life, so you should treat it as an investment. One of the ways to evaluate whether an investment is worthwhile is to use NPV. Therefore we should use the DCF with growth model as follow:</p>
<p>Step 1. Calculate statistical compensation difference
P(getting higher paying job at school 1)<em>compensation for higher paying job + P(getting lower paying job at school 1)</em>compensation for lower paying job - P(getting higher paying job at school 2)<em>compensation for higher paying job - P(getting lower paying job at school 2)</em>compensation for lower paying job</p>
<p>Step 2. Take into account annual growth for compensations of the jobs</p>
<p>Take the growth rate of comp at higher and lower paying job into account in the annuity.</p>
<p>Step 3. Calculate WACC
Obviously you are not going to fund your education with equity, so it’s all debt. so you WACC is the current borrowing cost for student loans.</p>
<p>Step 4. Calculate NPV
Assuming initial investment of total debt amount, calculate the NPV using the statistical compensation difference as an annuity up till retirement age, take the growth rate into account.</p>
<p>Step 5. Conclusion
If NPV > 0, the go to better school and take on the debt
If NPV < 0, dont take on the debt.</p>
<p>bearcats, the OP is not considering Wharton vs SUNY, for a career on Wall Street, she is considering Smith vs Michigan for Humanities and Physical Sciences. But even if she were, in this economic climate, it is irresponsible to recommend taking out a $70,000 debt, regardless of one’s career aspirations. $70,000 may mean nothing to you, but to someone who actually must take out such a loan, that is a lot of money.</p>
<p>OP mentioned what she might major in, but did not mention her career goals. One could very well go from history or hard sciences to banking. That is why I said you didn’t have enough information to make that call. </p>
<p>I am not talking about OP’s case specifically either. Your quote is “no university is worth 70k in debt”. You said that as a general statement as if it applies to everyone and I think it’s irresponsible to say that without knowing a specific scenario.</p>
<p>"$70,000 may mean nothing to you, but to someone who actually must take out such a loan, that is a lot of money. "
Just so you know, I am taking out 200k on loan at an unsubsidized 9% because I dont want to depend on my parents for MY education. I fully expect to be able to repay the whole debt within 5 years of bonus payments at the very most.</p>
<p>Agree with Alexandre, not to mention that while calculating the net present value is great in theory, there is absolutely no way an 18 year old that has not taken a single college course yet could possibly put in accurate numbers to do the calculation. Not only is there insufficient current knowledge, who knows what regulatory changes and other factors might influence compensation in the future.</p>
<p>I sure hope for your sake everything falls into place just as you are predicting, because if it doesn’t you will be hurting big time. Unless someone is cosigning for you, I actually don’t believe any bank would loan you that kind of money.</p>
<p>bearcats, it doesn’t matter whether we agree in general. With regards to the OP’s specific case (Smith with $70,000 debt or Michigan with no debt), the choice is clear.</p>
<p>I didnt say anything about OP’s case.
Read what I said. I disagree with your general blanket statement “No university is worth 70k debt” without knowing specifics. I dont disagree with your advice on OP’s case.</p>
<p>btw FWIW, it’s not 70k debt vs no debt…
This is what OP said,
“My scholarship is $10,000 and they gave me loans such that our out-of-pocket payments would be only about $5,000 per year–the most we can afford.”</p>
<p>“At Smith or Wellesley, I’d graduate $60,000 to $70,000 in debt. At Michigan, I could save that money for grad school.”</p>
<p>Either way Bearcard, we are talking about a $70k gap. </p>
<p>“I disagree with your general blanket statement “No university is worth 70k debt” without knowing specifics. I dont disagree with your advice on OP’s case.”</p>
<p>You may disagree, but my opinion is based on sound financial advice. Most 22-30 year olds would drown with that kind of debt, regardless of career goals. Even Wharton and Harvard graduates are are having trouble finding the types of jobs that pay enough tocover those types of debts. An 18 year old should not be encouraged (or allowed) to take such risks.</p>
<p>Phanatic, apart from the fiscal considerations, which are very important, you might want to consider that RC IS, in essence, the equivalent of a ‘small liberal arts school’ that just happens to be in the midst of a very large, world class institution. Several students from my son’s HS class attend RC, and the verdict is they all love it. They attended a small, humanities-based interdisciplinary style magnet school that placed a heavy emphasis on the kind of socratic learning you seem to be craving. Did you go to spring welcome day and stay with any RC kids? Do you know anyone in RC you can go spend the weekend with? Give it a try. I think you’ll find what you’re looking for. Good luck with your decision.</p>
<p>“An 18 year old should not be allowed to take such risks.” </p>
<p>I am glad you are not my parent You sound like the dictator type.</p>
<p>“Phanatic, apart from the fiscal considerations, which are very important, you might want to consider that RC IS, in essence, the equivalent of a ‘small liberal arts school’ that just happens to be in the midst of a very large, world class institution.”</p>
<p>In addition, it’s like 80% hippies. It takes certain personalities to fit in.</p>
<p>bearcats, I think young adults are more likely to have lapses in judgement. They are more likely to make costly errors, especially when under strain. A $70,000 is a lot of strain. </p>
<p>That said, I will not be the dictator type, but I will certainly be the protective type (we are expecting our first child in less than three weeks). I believe in each child making her/his way on the world. My parents are very wealthy, but they did not give me a single penny since I graduated from college. They often offered, but I never accepted. But paying for college education is a parent’s obligation, and if parents cannot cover it, the student should take a small a loan as possible, unless faced with a once-in-a-lifetime opportunity (like Harvard). But even then, restraint must be exercised.</p>
You sound like the dictator type.</p>