Private Universities and Colleges Not Worth It for Upper Income Families?

Parents Forum
1

I know there’s studies on whether Ivies are a good return on their investment, but those studies weren’t done during times inflation-adjusted tuition room, board and fees total over $60K per year. And of course not all schools charging that today are Ivies or even schools with cross-country name brand recognition.

I’m thinking ahead here. My kid’s only going into 8th grade, but the answer to these questions is important because she needs to know whether killing herself with max APs, best possible grades and ACT Prep (in addition to everything else) is going to be a better path in terms of college placement than relaxing a little and not turning into an anxious, exhausted neurotic. If she’s going to the state university or a “lesser school” willing to give her merit aid either way for financial reasons, she can relax a little and step back from the rat race. She’s the kind of kid who will push herself to do whatever the best path is. Our job is to help guide her on what that might be.

FAFSA seems to think our family can afford these $60k+ schools, so need-based financial aid is certainly out. But even though we drive 15 yr old cars and have no student loan debt ourselves, don’t take vacations and a modest mortgage compared to income, I say they are freaking crazy! Surely we are not the only “affluent” family in this boat?

Sure, our kid (a US News high-rank aspirant like so many of her peers) could get some tuition paid for at a “lesser” ranked school. But our state university is only $20K soup-to-nuts, and though I am no expert on this, I can’t imagine a graduate or professional program would be more likely to take my kid as a strong graduate from a private school that’s willing to cut her tuition in half than one from the public university here. If financial reasons are a good reason for her to go to a “lesser” ranked school or the public university, then it’s just a function of where she likes best, and that’s a nice position to be in.

But wait! What about her dreams of a top private college or university? Her horrors imaging some arrogant jerk she knows at a higher ranked school than hers? Before I advise her to give up the “top rank” rat race altogether, let me ask some questions.

Questions: 1. Is there something about these sticker prices I should know that I’m not considering? Are top 20 ranked private schools giving loads of merit aid to upper income kids I don’t know about? Like half price or 30% off, and the kid didn’t do something like cure cancer in high school?

  1. Is there any reason to believe paying a quarter of a million dollars for an undergrad degree at a top private school is worth it in terms of opening doors later? How much more opportunity are people really buying their kid to be in the middle of the class at, say, Yale versus top ranked at their state flagship?

We’d like to be able to help her with grad school, so she doesn’t end up having to give up all public service and charitable concerns in her life to pay the student loans from that. We’re not concerned with money for money’s sake but for the freedom to do for others if you’re not crunched paying half a million in debt yourself.

I know two older men with degrees from Harvard and U Penn. Both have the opinion that today’s private tuition for families in our income range (affluent by comparison but not rich with $240K in extra cash per child!) is not worth it. Before I tell my kid it’s not worth it, let me know if I’m missing something please.

Thoughts? Thanks for reading.

2

Regardless of whether the schools in question may be “worth it” in relation to your financial resources and her academic and professional goals, higher achievement on her part will give her more options, whether in more selective colleges or greater likelihood of large merit scholarships at less selective colleges (note that the super-selective colleges give no or very little merit scholarships).

Also, remember that super-selective schools see lots of 4.0 GPA / top-end-ACT-or-SAT applicants. To be admitted, it typically takes something more, such as a very high level extracurricular achievement or award, and not have any “defects” (meaning mediocre recommendations, poor interview performance, etc.). Do not count on the idea that top end academic credentials will be sufficient for super-selective school admission – top end academic credentials will simply get the applicant into the game, but chances of admission are still low.

A small number of career directions (management consulting and investment banking) are generally thought to be highly school-prestige-conscious in recruiting, but many others are much less so.

3

You have restarted a never ending debate on this forum, and you will likely get many responses, some who vehemently contend that the price tag is not worth it and others who will vehemently argue that it is. At the end of the day it will come down to what you and your family value. It also depends on the student and what they end up doing with whatever opportunity is put in front of them. Some students will reach very high places in their careers staring at community college while others will have the 240000 per year education with everything else you can imagine to go with it and squander it all.

4

A few things.

  1. IMO, the goal of high school isn't to get into college. Learn for learning's sake and the "right" college will present itself. If she wants to take APs and whatnot, let her or encourage her. She should be doing them because they're rigorous or interesting NOT because of what college she may or may not get into.
  2. Even with that said, she is in 8th grade. Her interests are going to change. What she wants now isn't necessarily what she's going to want next year, let alone in 4-5.
  3. You need to figure out what YOU are willing to pay. College tuition is unpredictable and may change drastically between now and then. Some of my state schools' COAs have almost doubled in the last 5/6 years.
  4. What is the reason for wanting "private" colleges (as though the descriptor means anything, really)?
  5. Grad school is really, really, REALLY far off. Assuming she wants to do grad school (and again, she is what- 13???) then a PhD should be fully funded. If she is doing some other degree then you can cross that bridge much, much, MUCH later on. A LOT of students go into college thinking they want an advanced degree and decide "NOPE!" after another 4 years of school.

My perspective: I am coming at this from someone who did very well in high school. Was driven (but still had fun). Went to a “lesser” state school and am now in a fully-funded PhD program in a top 3 school in my field (a history field). In 8th grade, I wanted to do medical research and find a cure for Cerebral Palsy. When I started grad school, I wanted to work in international reproductive health. Now, I’m pursuing a PhD in an American history subfield. Life is funny.

5

Oh I know one has to have much more than just top marks. Those get your foot in the door of consideration, but you have to be extraordinary on top of that, and increasingly extraordinary by not only national but international standards. Seeing as how school is 8-3pm and then they come home with 3-4 hours of homework in the top classes, fitting in being a star athlete and running a website about a nonprofit topic she’s passionate about (both things she wants to do), and having community/school involvement outside of academics and sports, etc etc. sounds like a recipe for misery and sleep deprivation. I am very grateful for people like romanigyps… above who find a big load of AP courses intrinsically rewarding and still leaving room for fun – and I say this as a voracious independent adult learner – but that grind just sounds like hell for anyone who’s not a genius and/or can’t function on less than 6 hours of sleep. (I figured tip top ranked schools aren’t just for low sleep needing geniuses who can do it all, because I know some of those grads and know better…but now that I think of it, they graduated back in the 90s when things weren’t as hyper-competitive.)

My personal read on consulting and finance firms recruiting only from the top schools is that they know that’s where the kids who will work themselves to death and are also very bright are. With my kid’s philanthropic drives, I can’t see careers there. But romanigyps… may be right and you never know what she’ll want to do. That, however, seems more like a cause to go with a in state public university. One can’t be switching majors if it means graduating a year later at a $60K/year price tag.

Right now, she wants to be a doctor and medical school is pretty expensive. If we had $240K, I’d rather we help her with medical school so she’s not walking out with $500-600K in total loans like many graduate with nowadays. She might be free to go into primary care or travel with Doctors Without Borders or something with that kind of leg up, if those type of things continue to be her passion. And if she abandons the doctor dream and wants to become a high school English teacher or some other noble but low paying profession, an extra $200k could come in handy in life.

I read The Short and Tragic Life of Robert Peace, and the saddest part of that book outside of the main character and his family is that the Yale roommate who everyone thought was so brilliant he would cure cancer ended up going into dermatology because of his student loan debt. Not because he wanted to, but because of his and his wife’s (also an Ivy grad physician) debt. I know a young dermatologist who went to the University of Oklahoma–good school but it didn’t require a Yale undergrad, Yale Medical price tag, or work-yourself-to-death high school schedule. What if the Yale grad hadn’t bought the Yale debt and was financially free to actually work on cancer research like he said he wanted to? What if his parents had told him to go in state and he listened?

I know I’m asking a question with no certainties and many possible twists of fate between now and when she graduates college, but we have to make the best choices with the info we have. And the choice to not pay a quarter million to schools with billions in endowments (the quarter million ain’t feeding starving kids here), seems just insane unless one is so wealthy that a quarter of a million is easily ponied up. I figure there’s so much demand for these schools that I must be missing something. But maybe I’m not?

(Oh, and to answer romanigyps…'s question 4, I said private because public OOS schools may as well be in terms of tuition. There’s nothing particularly appealing about them over public universities than their prevalence in the top tier of US News rank, which the kids in my daughter’s academic circle seem to be poring over.)

6

You can call me romani :slight_smile:

No one can answer your question about whether or not it’s “worth it.” As someone who grew up poor (I was a 0 EFC student), I can’t imagine ever spending that amount of money on a college education but what I value or don’t shouldn’t make a lick of difference to you and your family.

I will always very much stick by my belief that a good education can be obtained at the majority of colleges. What is important in high school is develop the skills that you’ll need in college and beyond- not racking up a certain number of APs, ECs, and so on.

Also, fwiw, I was the child who would push myself to the limits in order to take the most difficult academic path. It was my parents that pushed me to slow down, enjoy high school, take fun classes, do ECs that were fun for me, etc. I took their advice and am eternally grateful.

7

You’re not, and you kind of know it but imo you are looking for reassurance that you aren’t shortchanging your daughter- and you were very lucky that the first two responses were level-headed and thoughtful!

One of the core principles of Montessori is ‘follow the child’. I know, you are starting from

. Like so many things that is kind of true - and kind of not. Your job is to give her boundaries- identify dangerous paths, for example, or hidden good or bad points about different paths. Her job is to figure out what that path is- and for almost all kids that means trying quite a few. The idea that there is a ‘right’ or ‘best’ path is as unhelpful in academic/career choices as it is in romantic choices!

If you set yourself a few core principles:

=> that each stage of life has value in itself-that high school is a particular time in your daughter’s life, a time when her ‘job’ includes forming very important parts of who she is and how she relates to her world, not just preparing for the next job

=> use decision trees that consider what will open the most opportunities / close off the fewest opportunities. So, in choosing secondary school options, ensure that the requirements for most competitive opportunities are considered.

=> set a budget for what your family is willing to spend over (say) 8 years (to allow for grad school) on education for this daughter (it wasn’t clear if you have other children to consider). A budget can be a gift for a student, because they know where they stand- and I suspect it fits with your families values: reading your post, it seems that you have consciously made choices on how you spend money. Remember that your daughter has been marinating in that ethos her whole life- she knows that you make choices to not have debt. Once you know what $ range you are comfortable with, involve her in the discussion (remembering that no decisions have to happen this year!). I have seen many, many approaches to this: parents will pay for undergrad at State U, and pay grad school if it comes up; will budget X and what is unspent will be gifted towards a downpayment on a house; will pay X and expect D to cover the balance and so on. The actual outcome matters less than that you are clear about what you are happy with and you involve her in the process: using the’ teaching to ride a bike’ metaphor, this is the training wheels stage :slight_smile:

Then let the rest unfold. Let your D take the lead. AP classes are not necessarily a grind- esp for a strong student in a good school they can be some of the highlights of high school. Orchestra followed by swim practice may sound exhausting- but some students love their cello and the physical release of the workout. The Irish use the phrase ‘horses for courses’. Trust her, and trust the process, and she will find her course.

8

The grades & test scores can translate into nice merit scholarship packages from attractive private schools, too.

FYI
http://www.kiplinger.com/tool/college/T014-S001-kiplinger-s-best-values-in-private-colleges/

9

@fatdog11 Why don’t you run the school-specific financial aid calculators to see the results.

10

The USNWR “rankings” add a lot of distortion to the process. Learning more about what they do and don’t measure may be helpful for your family. This article explains its questionable metadology in detail:
http://www.newyorker.com/magazine/2011/02/14/the-order-of-things
Frank Bruni’s new book about college admissions may be interesting to you as well. Best wishes!

11

Also, good AP scores could mean savings as well (in terms of being able to graduate early). Granted, if she is pre-med, med schools would want to see her take the required science courses in college, though.

As for public OOS costing as much as privates, eh. UW-Madison tuition+R&B is $40K. At Columbia & NYU, tuition + room&board is $60K+. To me, that is a difference.

Agree that the USN rankings add a lot of distortion. She should come up with reasons for schools herself rather than be a lemming.

Also agree that there are big merit scholarships (full-tuition) at some schools for top students and National Merit Scholars.

And the top privates are generous with fin aid, so to many people, they are more affordable than even in-state publics (and other families make so much that they can afford it). Don’t assume everyone makes as much as you do.

12

Your eighth grader has dreams of attending an Ivy or some other elite school? I would suggest that you and the other parent, and this student drop the “dream schoo” idea now. Start to look for a variety of colleges that have the characteristics this student wants. Really, however, so much can change between 8th grade and 12th when the student will actually apply.

Your kiddo should do the best she can do, because that is a good work ethic for school…and beyond. She should prep,for the ACT and/or SAT because better scores open more options for acceptances and merit aid. She should take courses because they are interesting and challenging for her.

You do realize that some of the scholarships at public universities are becoming more and more competitive, right? Taking it easy because she thinks she will be attending a public university is not a good idea.

You need to START thinking about your college budget. What will your family pay annually? If you don’t qualify for need based aid, and don’t want to spend $60,000 a year, there are schools with good merit aid…for students with top stats. So…your daughter needs to do her personal best regardless.

13

I know this is unsolicited input, but I have to say that this saddens me a bit-middle schoolers obsessing over getting into highly ranked colleges. In 8th grade my daughter had never heard of the US News rankings. On a shopping trip to Cambridge when she was 13 she asked “Harvard-is that a good school?” That’s the way we wanted it. She worked hard in school but not with an eye on a specific group of colleges. She did a ton of extracurricular activities, but only things she wanted to do. Nothing done for a college resume. She was the captain and MVP of her middle school sports team, but dropped that sport to try something totally new in 9th grade, as did many of her peers. This has served them well, with the majority heading off to Ivy League colleges or top-20 LACs.

This is not a kid who’s naturally brilliant. She’s smart but she had to work in HS. We wanted her to work hard because it’s made the intellectual journey more fruitful, not because it would pay off in terms of college acceptances. I can’t imagine how crushing it would have been to spend 5 or more years slogging away in pursuit of such a goal only to slip in some way and fail to meet the mark.

14

For my kids the biggest advantage of taking “tons of APs” in High School was the chance to be in classes with the other “smart kids” in their high school, to get away from classes that had busy work and dumbed-down assignments. They also wanted to go to selective schools, but the advantages DURING high school were a big deal for them as well.

15

If she truly has dreams of being a doctor, the college search will be very different for you in a few years. It will be about finding an inexpensive college where she can get very good grades and where she can do research, non-clinical and clinical volunteering, etc. A state school is great for those things, except possibly the competition in the science classes. However, high school is where you can learn the study habits and discipline it takes to exceed in school. AP classes can also bring credits that she will want at a state school, freeing her up to study things that she loves rather than spending a year in general education requirements.

16

I think the most valuable thing you can do for your daughter is to let her know asap that you’re not paying for Harvard, et al (if that’s what you ultimately decide). We’re in your full pay boat and that’s what we did. We figured out what we could actually pay each year and we told our kids. No matter where you live or how high stats your D’s friends are, she will not be the only kid in her circle who has financial constraints when it comes to choosing a college. But it will be helpful for her to set her expectations appropriately and the sooner the better.

So we set a budget for college. We were somewhat lucky in that our high stats D didn’t like the vibe at the really elite schools BUT her favorite school (ranked around 30) only offered 15 merit scholarships and she didn’t get one. That meant the school was off the table. I’m not going to lie, it was a blow to her even though she knew ahead of time that she was likely to receive what amounted to a financial rejection. And as far as your state schools go, they may or may not be a good fit for your daughter. Even though two of our state’s schools - Temple and Pitt - would have been tuition free for our D,she did not want to be at an urban school, so that meant they also were also off the table.

We had told D we’d cover up to the cost of Penn State (about 30k). She just had to find that school. This approach worked for us because 1) she was willing to go to Penn State if nothing else came through for her and 2) she ended up having lots of really good options. In the end she found an excellent fit for her and a very affordable price for us.

As far as AP’s and all that goes, let her figure that out for herself. While it was very freeing to my D to know that we weren’t paying for Penn no matter what, she’s a driven kid and took all those classes anyway.

17

@halfemptypockets

Did you discuss college finances with your daughter as a rising eighth grader?

The things that the student might like will likely change between 8th and 12th grade.

The family income and ability to pay might also change…either up or down!

18

Not specifically. She didn’t really have an interest in colleges at that point. And you’re right that we didn’t know exactly how much we’d be able to afford - but along those lines, I don’t know for sure what we’ll be able to afford next year either, but I’m assuming since our payout is significantly less than our top college budget, we should be able to swing it. Provided, of course, that she does her part and keeps her merit scholarships. I knew back then with reasonable certainty that we weren’t getting financial aid but that there was no way we could afford full price, so even though we didn’t have specifics, she did generally know and understand that we weren’t paying for an elite school . Student loans were such a burden for my husband and me that we refused to inflict that debt upon our children.

But we have no inheritances coming. I don’t play the lottery and our skills are only ever so much in demand. Our other kids have needs and we all need to eat. There was no way we were going to be able to afford full pay at Penn. This parent’s circumstances might change or they may decide to swing an elite education. That would certainly be a wonderful turn for his D, but in the mean time, it probably is best to let her know that college is a financial decision, particularly since she’s already thinking of colleges. My kid wasn’t, but I’m glad I prepped her anyway.

19

I do not see why to choose a college based on ranking. It is a shallow approach that could backfire badly not only financially, but also simply for the fact that the college may not match the student personally, wide range of interests and frankly the goal in the best way possible. There are plenty of colleges (cheap and expensive) that would match a specific student. The fact is that the top caliber kid who is up to being accepted to Ivy’s will find plenty of UGs that would offer full tuition/full ride to such a student. And at the end, it is a student’s effort at the college and the engagement and overall set of activities that will make a difference. School name may have some influence or may not have it at all. Most of these top kids have a goal of attending some kind of Grad. School anyway. At the end of this Grad. School they may realize that paying huge tuition for their UG was not worth it at all. My D. has discovered that based not only on her own experience (was attending in-state public college) but also on the comments from her classmates who expressed a great regrets for attending colleges such as Harvard. They could have done just as well after graduating from free (for them) in-state publics, where top kids are very greatly appreciated, have the top opportunities in everything they want to pursue, have a chance to be among top caliber kids like themselves, and be just as successful at their goals as their future Grad. School classmates or co-workers who graduated from Ivy’s and such. No difference at the end, except in the amount of student loans.

20

Listen to Romani and those who tell you to decide in advance what you’re willing to pay and stick to that. We spent close to a quarter million dollars on kiddo’s boarding school and saved an additional quarter million dollars so kiddo could graduate from any college without debt (any college, no strings). He chose…wait for it…a service academy! They’re free (not counting the pesky potential for the ultimate sacrifice). The best laid plans…

There is absolutely no magic conferred by attending expensive schools ranked by a magazine, and considering ROI on a college degree is, IMHO, exactly what is turning colleges into vocational schools and distorting the meaning of “education.” My vote is for encouraging your daughter just to be all that she can be (oops, maybe that’s where we went wrong), pursue what interests her in high school without “turning into an anxious, exhausted neurotic,” and pursue a college you can comfortably afford for the fine education it will give her in those interests without concern for rankings. She will do well.