<p>One of the things that I would be concerned about (option 2) would be the impact of paid internships on his financial aid. I realize that it is getting harder and harder for students in coops to get paid jobs, but if he does, that money will influence his EFC. So, although he would get the experience of working (and hours towards his IDP) he would not benefit from the extra money and would technically be in the workforce earning his own money a full year later. </p>
<p>Once all of my son’s acceptances and financial aid packages came in, we had to immediately dismiss the OOS schools as costing too much. We were left with our state school that had a bachelor of architecture plus a 2 year graduate program versus a private school with a 5 year MArch. The private school came in at about 70K more (profile school that took home equity into account) for the 5 years, but he would be in the workforce a year sooner. We all chose the private. However, it had always been my contention to use our home equity towards our children’s education and then move somewhere less expensive to retire.</p>
<p>pageturner: the questions you ask are very hard to answer. And differ for each individual. We have posters on this board who insist the money they invested in the education of their children, at private expensive schools, was well worth it. They point to good contacts, interesting friends, a scholarly environment - NOT all things money.
I tend to have a more practical view - and my son followed suit. There are MANY quality colleges out there and most kids can find a reasonable match without shelling out huge amounts of dollars.<br>
Stop feeling guilty about not being able to offer your son the opportunity to attend what you both see as his “dream” school. Move on and make the best of the choice that makes sense here. Learning how to be flexible and adapt is a good life skill and will serve your son well in the future. Mick Jagger was right…</p>
It sure is. S has a full ride to an up-and-coming LAC, lousy finaid for his dream school, and so-so (but doable) package to our (nationally respected)state flagship which is giving him curricular freedom. We have told S that he will get our FAFSA EFC to put towards law school if he takes the full ride.</p>
<p>Yes, the “to spend or not to spend?” question. This is something being faced in many households around the country. We are in ours - D has narrowed the choice from nine to two - the expensive private vs. the very affordable in-state university. The private is about 3 hours away, the state school 10 minutes away. The private is the size she is most comfortable with (just under 4,000), the state larger (16,000). The private has the classical, beautiful, idyllic campus, the state a very nice, but not quite as bucolic, campus that is more urban feeling. Both have her desired program (engineering) and both are well-respected, but the private just has more cache. The private has an LAC feel and mindset (which is what she wants - a technical program in an LAC environment), the state is . . . well, a large state university. The private is exciting, novel, away from home but not too far away, the state is too familiar, unexciting, too close to home (and we do consider “going away” to be an integral part of the educational experience). The private is $50K/year but with a $10K merit scholarship (among the largest it gives out) is down to about $40k (and, with need-based aid that she would only get the first year as there would be two in college, is about $29K), the state with a $10K merit scholarship would be about $7K/year. The $40K at the private is about what we will be paying for her brother’s senior year at an OOS Public Ivy (which is a 33% increase since his acceptance three years ago - we might not have pulled the trigger had we realized it would increase that much). We can do it and she would graduate with just the standard unsub loans, about $20-25K, although it will mean that there is about $30-35K/year that my wife and I won’t be putting into savings, retirement, house maintenance (driveway, septic, roof, siding, windows, furnace/AC, bathroom, etc.), or maybe that red convertible sports car I have been waiting for my entire 48 years. The state school - the money is in the bank, she would graduate debt-free and with a nice chunk left over so she would have more financial breathing room both during and after.</p>
<p>Is the private 6 or 7 times better than the public? No. But it does appear that it will offer her a somewhat better education and overall experience and whatever amount of “better” that is will cost an extra $33K/year and her debt will still be manageable. While I have been the “voice of restraint” through this whole process, talking up the low-cost, bargain options, I find myself now in favor of the private. The sports car option will still be there four years from now, but my baby’s education and future path are right now. On the other hand, the state school is a very good school, many, many kids consider themselves fortunate to be able to go there, and she will do well wherever she goes. </p>
<p>Would we have her go with the private if the only way was to take on significantly more debt? Probably not. But we can do it without that so that is probably what will happen. Anyway, she/we have two more weeks in which to make the decision.</p>
<p>Good luck to you in your decision. Isn’t it great that we have the choice?</p>
<p>It is an emotional choice vs practical one. When you buy that car, the excitement wears off when the new car smell goes away.Then you are left with the payment. In my field it doesn’t matter where you went to school , paying for private doesn’t make sense but many do. In other fields it does. It has to be worth it because that is a large amount of debt. It’s a dilemma short term vs long term goals. I have to say our kids are lucky we care so much about their happiness.</p>
<p>The answer is so individual. It really comes down to what it’s worth to the family. There are families out there who would move into a trailer, take on three jobs, deplete every resource and beg from relatives to send their kids to certain schools. It has been said that they would glad give up an arm and leg for the privilege of beggaring themselves to pay for that college. </p>
<p>I was kind of that way. I really wanted my kids to go where ever they wanted, and I would have gone pretty far to pay for HPY even if we really could not logically afford it. Part of why we are in a weaker financial situation now is because of the private education I insisted for all of my kids, not just for college but pretty much all the way through school. Even now, when my last one to go through this process was accepted to an ivy, I started to salivate. If that was his first choice, I’m afraid I would have somehow managed to get the money to send him even if it was double what we can afford. </p>
<p>However, when it came down to some schools that were not as well known, I could dig my heels in much easier. I don’t know what we would have done had we been gapped over what we felt we could have paid and S really wanted to go to a particular school. Probably given in, despite all of my big talk on this forum. But logically, looking at our particular situation I fully know that $30K a year was really the maximum for us. We did the numbers very carefully. And $10K a year in loans for us was our maximum. Even there we are taking some risks. So it comes down to discipline.</p>
<p>My H needs a new car. Our old sedan needs some expensive body work and has been giving us problems too routinely on the mechanical side as well. Oh, how I would love for him to get his dream car. And he so deserves it with the hours he works! He gets so little for himself and wants so little. But we are going to go with a more pragmatic used car that is not so luxurious, even though what he truly wants is not considered a luxury car. $10K difference is a lot for us right now. But,yes, I covet. Cars, college, a lot of things.</p>
<p>Just looking at a letter received inviting us to join a local club. Oh, we would love to do so. We know so many people there, as do our kids. It really would be nice. Yes, I think we could get our money’s worth out of the cost. But we really don’t have it in our budget. And yes, I want to join very much. But we won/t.</p>
<p>PT, mini is correct(as usual) that student debt in excess of $20k is just to much for a new grad to handle on graduation. But how much of that debt would you be able to take on to make choice #1 possible? Or are you already dipping into savings and discretionary income to finance a share of the cost? For some families grandparents are in a position to gift their grandchildren some $'s for college. The problem is how to avoid the awkwardness of such a suggestion.</p>
<p>I am not saying that this is the case for your family, but parents know the high cost of college and should begin saving the day each child is born. Admittedly most parents will not be able to save the full cost of a private college education but many are able to save enough to reduce student debt by a sizeable %age. Unfortunately for most parents here their children are approaching college age so that ship has long left port.</p>
<p>The thing many parents and most students fail to consider when financing college with large student debt is the sever restrictions that results following graduation. Some grads may need to live at home for a time to make ends meet financially, severely reducing job choices. And while friends w/o debt may have discretionary income for vacations/entertainment, your young adult is left out. And finally it could result in deferring important adult choices like marriage, having children and buying that first house. These are horrible trade-offs to be forced into in order to attend that “dream” college which may turn out to be not so dreamy after all.</p>
<p>There are times when the debt makes sense. That is, if family can help the student pay it. If that is not the case, the average undergraduate is not going to make enough to pay back a loan. I see many kids ruin their credit before they even really get any because of school loans. Because you are dealing with the government many times for these loans, you cannot get out of them. It can really be a problem for a young person trying to get on his own two feet.</p>
<p>My perspective is that money represents opportunity cost. If I had an extra $75k to spend on education, would I spend it on a different school? I might…but I also might spend it on a trip around the world, an unpaid internship in Paris, art school to learn how to paint on the coast of Italy, an unpaid internship in public health to fight AIDS in Africa, a year on an archaelogical dig, or a little more than a year at med school. The list is virtually endless. Now if I have money for different school plus these things, the value question doesn’t come up. But it has for me and my family, and we have made these types of “educational” decisions.</p>
<p>But what if the extra XXX is the difference between retiring early/on time or even a comfortable retirement? This is more likely the question that many parents face.</p>
<p>And, of course, all this is complicated by the economic problems of the past eight years. In 1999, based on our rate of savings and expected returns, we projected about $65K saved for our D when she was ready for school (i.e., now). Between then and six months ago, that had dwindled to $35-40K (thank you Bush/Cheney & co-conspirators). In the last six months it dwindled to about $20K (a parting gift from the Bushies). Some improvement recently, just sweating over when is the right time to cash it in - will it go up more, will it stagnate, will it drop again? We would have been much better off just putting it under the mattress (ok, maybe into an ING account). I thought about just cashing it in last Spring to be safe, but didn’t . . . (kicking self again).</p>
<p>Few have answered the OP’s actual question, so I’ll give my perspective on it.</p>
<p>There are times when it’s worth taking the risk and borrowing more than typical IMO. If your kid has an offer in hand from Wharton or MIT and has always wanted a career in business it may well be worth it. If he is aimed at a job that only recruits from a few schools and it is a high paying job, again, for risk takers the plan could make sense.</p>
<p>For what the OP describes, a kid headed for architecture, it most probably does not make sense IMO if most of the debt will be his. It’s one thing for the parent to decide to borrow and live less well to send the student to a better/dream school. It’s quite another to watch an 18 year old who doesn’t really understand debt and is headed for a career where most don’t make big money take on major debt.</p>
<p>And FYI, having watched how CMU deals with aid over the years, don’t expect a much better package!</p>
<p>"But what if the extra XXX is the difference between retiring early/on time or even a comfortable retirement? This is more likely the question that many parents face. "</p>
<p>Then it is “opportunity cost” to you, and you can decide whether the pleasure you would get from seeing sonny at prestige college outweighs your hopes for retirement. Every one can do their own calculus.</p>
<p>I suspect there is often much more to the decision making than “the pleasure you would get from seeing sonny at prestige college.” I suppose if you have already made your decision then reducing the arguments to prestige helps justify the decision not to spend a lot of money on formal education. Everyone looks at different factors. To me the decision is only partly about the comparison of schools. An even bigger factor is the interests of the individual kid. I have two daughters. One is extremely smart; the other is closer to average. My older, smarter daughter was never academically motivated. Her big interest in life was always getting married and having kids. She went to the State U, did very well and is proceeding with an average lifestyle. The younger daughter attacks everything full speed. She is in the 4th year of very intensive double degree program. Unfortunately her education is relatively expensive; i.e., a top 20 with just a bit of merit aid. It is not that I love or favor one daughter more than the other, but one was interested and is taking advantage of every opportunity. The other had other interests in life.</p>
<p>As much as I love my kids I am only willing to go so far. The school would have to give them unbelievable advantage to take on that much debt. So I would say no. although I would feel bad about it. My H who is less wimpy than me, would have no issue saying no, because he does not feel undergrad is as important as grad school. Sometimes you have to think about how much stress you can take on. Our kids are so lucky because we worry about this , I know lots that don’t give this any consideration.</p>
<p>“I suppose if you have already made your decision then reducing the arguments to prestige helps justify the decision not to spend a lot of money on formal education.”</p>
<p>Where did you get the impression that I don’t spend a lot of money on formal education?</p>
<p>As to your own two daughters, I am glad they are doing well, though it seems to me that the older one needed the boost more than the latter. (Similar in our case, though with the ages reversed - we are therefore spending MUCH more on the younger’s education.)</p>
<p>It’s not just about a tangible career advantage or getting into grad school. I’d make (am making) an extra financial commitment for a special campus environment that will prepare the student for a lifetime of interests, passions and achievement. The former doesn’t necessarily get you the latter, but the latter will offer a terrific boost to the former. The undergraduate experience is where adolescents turn into young adults. People get grad assistantships for graduate school. I wouldn’t shortchange the undergrad experience, and I’d make significant sacrifices to have it be as full and robust as it can be. But by sacrifices, I mean increasing my contribution as a parent or perhaps allocating a part of an anticipated inheritance toward it. I wouldn’t go as far as putting a $75K loan burden on the new graduate.</p>
<p>It is a tough choice, people all over this board are making this decision. Especially in these economic times. It really all just has to make sense from many perpectives. Sometimes we can’t all do the perfect thing. Hopefully the next best thing.</p>
<p>While it is a hard lesson to learn, prospective college students really need to understand that “financial fit” is part of “fit”. The OP has already decided that $75K debt is too much, and most of us agree. Beyond that, I’d be inclined to go with posters that draw the line at around $20K in student loans with major limitations on parents assuming additional debt–especially in the current environment.</p>