<p>There’s a good number of kids living in highish income homes, but both parents may not be in that home. Divorce/ remarriage can also play havoc with paying for college. Financial “hangovers” from the cost of the divorce. The step parent’s income counting in aid formula but not contributing, etc. </p>
<p>^^ Where do you live that 2 people with only BS degrees and 5 years experience as a teacher can make 125k together? Just asking, as an education major.</p>
<p>As someone who lives in a very “high-income” area (where the median home price is 700k, and many are much higher), I’d like to say that it’s not exactly high-income. My parents are determined to finance the full extent of my education, although I’m not sure how. As an earlier poster stated, what about families with multiple children in college? It already costs a significant amount to put one in college, and two is even more. </p>
<p>People may have bought high-cost houses when their income was higher, but they don’t want to sell their house at the moment; their income could have decreased some, but they still have to pay off their (high) mortgage.</p>
<p>125k is not that high of an income, especially depending on where you live and the circumstances under which you live. I’d say that around 80% of the kids in my high school have a family income of 125k or higher, 90% with 100k or higher, and probably 98% at 85k or higher–simply because the cost of living is incredibly high and anyone with a lower income wouldn’t be able to pay off their mortgage, let alone for other services needed of children (sports fees, summer programs, classes).</p>
<p>We live in a very high income area. Our EFC is off the charts of what we could swing with 4 kids. Because of that, what we will spend on college is probably 1/4 of what our EFC is listed to be. We are looking at in state schools that are more affordable. However, that being said, we will probably still get loans for our children. We want them to have skin in the game, and mommy and daddy paying for everything may not keep them as motivated as if they know they will have to pay back loans at the end of their college career. We know we live in an affluent area. But sufficed to say, not everyone who lives in an affluent area is blase about money. Some of us do our best to teach our kids valuable lessons about responsible finances. We hope that knowing that will aid in making good decisions about majors and classes and not wasting four years. We expect it to be a 50/50 proposition. We pay half, they are responsible for half. </p>
<p>When I went to college, my parents made too much money for me to get any grants or aid of any kind. So I took out loans for what my parents couldn’t cover. My friends father had his own business and wrote everything off as a business expense and their kids went to college for free because their taxable income was low. Not exactly fair, but nothing new.<br>
People think that “rich” is whatever is more than they are making. The guy making 30k more than you “should” be able to afford full sticker price for college, but you can’t. Well guess what…the guy making 30k less than you thinks the same thing about you. College costs are ridiculous for everyone…but maybe more so for those making more money (as backwards as that sounds) because someone with a lower income where their EFC is zero could actually look at Ivy League schools if their child has the grades, while those of us who would be expected to pay full boat could not. I’m not complaining - so don’t think I am. But, the grass is not always greener on either side of the fence…sometimes, it stinks for everyone. </p>
<p>" because someone with a lower income where their EFC is zero could actually look at Ivy League schools if their child has the grades, while those of us who would be expected to pay full boat could not. "</p>
<p>Yeah, we could look at it, but the odds of getting in aren’t any better just because of a lower income. Plus, your kid needs to have the stats to even make it worth applying.</p>
<p>With a higher income, parents can do what is always suggested on here for lower income. Spend 2 years in community college, then look for a commuter state school. </p>
<p>The odds of admission may not be higher simply because of having a lower income, but the odds of actually being able to afford to go to that school, with all other things like grades being equal, than someone who has to pay full sticker price, is probably better. </p>
<p>If i choose a private school without getting merit aid, I’ll have about 150k in debt. my parents made about 120k 2 years ago, but in the past 2 years they’ve nearly doubled their salary to 220k; nearing full pay. They’re paying through the savings they made (some stocks), so that hasn’t increased. They plan to cover 20-25k a year, which earlier could have been the full cost but now is not. </p>
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<p>I believe in many cases that this is true, but I think it’s a mistake. We should be looking at those who make less so we can appreciate what we have. I own a home. It’s in a safe neighborhood where my kids don’t have to be afraid to walk around at night. We have a good school district in a decent neighborhood. We own 2 cars and when they break down, we can afford to take them to the garage to be fixed. When we need groceries, we don’t have to wait for payday to go get them. When we’re sick, we don’t have to try to get by on an over the counter med because we can afford the copay at the doctor AND the cost of a prescription. We’re full pay for college, but have been able to save enough to pay for 2 years of community college and 2 years of commuting to our local SUNY, so our two kids will graduate with no debt. Compared to many other families in the US we’re well off, and we make less than half of what that $125k family makes. It’s all in your perspective.</p>
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<p>The article seems to be using 25%. Which is a dumb percentage to use (is “rich” really the word to describe 25% of people) but that’s what they’re doing.</p>
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<p>But that extra $100K of income will yield to about $55K of extra cash after tax, retirement and other deductions. That’s still better than making $110K per year and an EFC of $20K.</p>
<p>I know that’s simplistic, but if your family didn’t significantly increase your expenses now that they are making $120K, bottom line, is now you can afford full pay. I know it’s not easy and sometimes, it’s hard to justify. We are full pay as well and we had this decision to make last acceptance cycle.</p>
<p>Man these threads get really snarky don’t they? How bout if we just all agree on the fact that higher education costs are inflating so much faster than general inflation as to be ludicrous?! I don’t care of you are “rich” or poor, on this we can all agree. And the poor have no monopoly on being upset by a system gone wild.</p>
<p>@autinmshauri,</p>
<p>“I own a home. It’s in a safe neighborhood where my kids don’t have to be afraid to walk around at night. We have a good school district in a decent neighborhood.”</p>
<p>“and we make less than half of what that $125k family makes.”</p>
<p>That’s nice. In the region where I live, it would be difficult to own a home in an area that is safe to walk at night, and has good public schools, and could be afforded on that sort of income. You might be able to do that with the $125K income.</p>
<p>“We’re full pay for college,…”</p>
<p>If you “make less than half of what that $125K family makes,” unless you have a very large amount of assets outside of home equity and retirement accounts, then it is unlikely that you’d be full pay at many highly-selective private schools, which was the sort of school under discussion.</p>
<p>And if that’s the case - that you have significant assets - then you are quite unlike most families with that sort of income, or even families with $125K per year in income.</p>
<p>The bottom line remains that highly-selective schools are more obtainable financially for median income families than for many of those evil “rich” folks making $125K.</p>
<p>The article is clearly shallow and flawed. $125,000 is high income, obviously, but that phrase means nothing because whatever income you have is only relevant to how it allows you to purchase things and meet your goals. $125,000 is also obviously not “rich”, the article is ludicrous for calling it that. But even if a person is truly rich, then what they can and cannot buy today compared to 20 years ago (WAYYYYY too long a time frame for the way they presented the study) simply depends on how much the cost of that thing has changed. What matters is how much of a percentage of that income the item/service in question represents, not the absolute dollar amount.</p>
<p>Someone that has, say, $20 million could probably not buy a supercomputer back in 1994, yet I believe they could today. As someone else alluded, they could have bought some basketball teams back in 1994, perhaps, but not even close today. So it just depends. But for this article, the idea of holding income constant and then saying that people of that income have to borrow today when they didn’t have to back then…welll duhhhh!!! The average price of a college education has far more than doubled, and it has done so from a base that wasn’t $1,000 increasing to $2,000 or even $3,000 (in which case the percentage of income remains small despite the dramatic cost increase) but from a base where now a private education is going to most likely cost, before any discounts, $50K-$70K. This represents a big chunk of that person’s income, if that income is towards the lower end of what this article erroneously called “rich”.</p>
<p>Sure cheaper schools are available, but that is actually irrelevant for the issue at hand. Because the reality on the ground, which is what this study is looking at, is that many of these families will insist on a private school education. So arguing about whether that is logical or not and whether it is a good idea or not is completely off topic. Given that reality, given an income where the lower limit is fixed at $125,000, and given the dramatic increase in the cost of attending college in that time span, of course this is being financed through a lot more loans.</p>
<p>If the study had looked at incomes of $1 million or more instead of $125,000 or more, I suspect the number of student loans would have barely budged. These families, with only a few exceptions, can still afford any college out of disposable income. I imagine the doubling of loans is almost all in the $125K-$500K range. In fact, given that they have lumped in the truly rich with the upper-middle class, I suspect the percentage increase of those taking loans in the lower end of the range, say $125K-$250K, has probably tripled or quadrupled. That would have been nice to actually see.</p>
<p>Honestly, any idiot could have told you without doing a study that families making $125K-$250K are needing to take out loans to pay for college far more often than they would have 20 years ago. Much more interesting would have been to see at what income level taking out loans becomes rare.</p>
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<p>I wonder if those making $125k should quit their jobs to make college more obtainable financially.</p>
<p>“I wonder if those making $125k should quit their jobs to make college more obtainable financially.”</p>
<p>LOL. The thought has run through my own mind.</p>
<p>I own a small business. The first year of college for my older son, the financial aid folks counted as an “asset” their imputed value of my business, and counted 5% of that as part of our EFC. I visited the financial aid folks in person and said, well, yes. I could sell my business in order to pay tuition. After paying off my business loans, I wouldn’t have near enough money to pay your school’s tuition for the next four years, but I WOULD have no more income, and thus could ask you for full costs for my son! They backed off on that part of our EFC.</p>
<p>again, they made a college investment based on prior savings. my dad’s had those tsocks for like a decade (they increased in value). I’m not blaming anyone, but that’s the reality of the situation for me. I do htink it’s fair for colleges to make us nearly full pay, and I’m happy my parents are providing at least some financial support. It’s just the reality i have to work with. I’m only considering a few top colleges seriously now. </p>
<p>@ursmarterthanme agreed. It’s also ridiculous that our parents’ colleges call and send letters all the time asking for money, when their campuses are complete and they’re charging more tuition than ever - as my granddad would say “didn’t I already pay for my college education?”</p>
<p>@notjoe that’s the spirit!</p>
<p>On the notion of quitting your job so you’d qualify for fin aid. Not so far fetched, and not funny to quite a few of those in the middle. What we’re talking about here; before you react; is the private schools. It has become the case that the middle range of income those just above qualifying for any need based aid, and yet well below being able to afford to pay full-boat, are frozen out of the private schools. Again, please don’t go off, and say it’s all about choices. That’s so trite. I get it. those frozen out, can still go get a great ed. at a public. I am not making this a blame thing, I"m just stating fact. Families that qualify for aid, (and where the student qualifies academically) can go to a private. Wealthy kids can too (given that they qualify academically). Kids in the gap can’t. And, again, before you say “well they could if their families would sacrifice.” Yes, I suppose so. But most families down want to get a second mortage, or move out of their home, or cut their spending in half in order to make it happen. Again, just stating fact.</p>
<p>Anyone who thinks that $125k a year isn’t rich is seriously cut off from reality. It’s not super-rich, or anything like that, but it means you have far more money than the vast majority of your compatriots.</p>