<p>On a lot of decision posts, posters seem to be advised to save their money for their kids' grad school/law school/med school/etc. But how many of you will actually put that "saved" money towards your kids' post college education? I've seen parents pay through the nose for undergraduate schools, but I know very, very few who will put money toward their kids' post college education...</p>
<p>It depends really. My parents knew that I wanted to go to some sort of grad school when I started college. Law… Vet… whatever. But we never really talked about it. They know that my brother wants to go grad school as well- he’s talked of law or business for some time.</p>
<p>They ended up deciding that a four year bachelors degree was enough of an investment. Even if we didn’t want to go for grad school, our BAs would at least get us through the door. But when we say “save it for grad school” is basically saying to the parents that if they want to finance their children’s education, they have to decide just how much of it will they pay. If parents want to be generous to pay all the way through, then they need to control some financial aspects of the undergraduate.</p>
<p>Now my brother and I are responsible for paying our own way through grad school. And 3 semesters of my MA program… I’ll take it over paying for 4 years of undergraduate education.</p>
<p>Psych:
Many students apply to college with the idea that they will eventually go to med school or perhaps law school. If that is the case, then it is prudent for families to consider saving for this eventuality as funding is not easy to get for such schools. They will still have to take considerable loans in order to fund all three years of law school or four years of med school.
We saved and borrowed to fund our sons undergraduate education knowing that neither wanted to go to med school or law school. S1 is out and working. S2 is about to go to grad school on a generous fellowship. We still have to pay back the debt we incurred for their undergraduate education, but it’s quite doable. As I wrote in another post, if there had been an inkling that either had shown an interest in law school or med school, we probably would have had them apply to merit aid or attend our state university.</p>
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<p>So, you are suggesting that parents are trying to pull a fast one, talk the kids into a cheaper undergraduate school with promises of help in the future, and then reneging? I don’t think I know anyone who is planning that course of action. I suppose there are those who are willing to deliberately damage their relationships with their children, but they aren’t admitting as much to me.</p>
<p>My son could have chosen to attend a full-pay school, in which case his savings and our savings for him would have been depleted, and he would have been carrying some loans, albeit not large ones. Instead he concentrated on finding a big merit deal to a good school so he could graduate with his savings intact, our savings in good shape and no indebtedness. (He was quite successful in that search. And lucky). We will give him some of those savings upon graduation. However, I don’t think he will need them for graduate school tuition, since he is in a research-intensive field and should be covered by stipends and waivers.</p>
<p>My daughter, still in high school, has her eyes set on vet school (large animal). She will most likely be practical and choose a public univ. with good pre-vet options, as well as ancillary programs that serve a pretty specific set of interests. In that case, we will help with vet school, assuming that comes to pass. If she decides to go with a more expensive undergraduate option, we have savings and can handle that, but her savings will be gone and she will have small loans also, and help for vet school will be very limited. </p>
<p>Of course, if the investment situation continues to spiral downward, everyone’s plans and promises will be subject to modification, whether or not the original intentions were honorable.</p>
<p>I’ve always thought the “save it for grad school” advice applied for kids, too. Don’t take out big loans for the undergrad degree if you plan to go to grad school, too. Save it – taking out loans – for grad school.</p>
<p>Well, in our case, our sons have college accounts (529s) and those accounts are set aside for them specifically. So when my son decided to take a full-ride, he was choosing to save that money for grad school. We aren’t planning to spend any money on his grad school although will help if we can, since we don’t have to spend very much on his undergrad experience. </p>
<p>He had a certain amount of money and decided when/where he wants to spend it.</p>
<p>FWIW: My sister, a professor at a good top 20 school, says she sees many, many bright kids forgo grad school because they are burdened by undergrad student loans.</p>
<p>We told each one how much money we would contribute for their education. They could use it as they wished. Each has done their own thing with that money depending on where they wanted to go and what scholarships they received. Any left over from undergrad could go to grad. They have used it for undergrad, though. In 2 cases they have used it up without graduating due to their own poor choices. They now have to cover the rest. We were always very straight forward with them on this issue.</p>
<p>I think that “save it for grad school” means don’t take out big loans as an undergrad. You will have far fewer choices for grad school if money then becomes a factor in your choices.</p>
<p>We saved up for full-pay private. Our son chose cheap third-tier public. I don’t expect to have any need for that money in the future and we’re mostly paying college costs out of current income. He wants to do grad school but he might work for a while before then. At this point, it seems like there are a lot of options and we’ll look at that when we get there. My current thoughts are just to give him a big chunk of money after graduation if he doesn’t want grad school. It may be that he declines the money too if he goes to work.</p>
<p>We promised our kids an undergraduate degree anywhere they wanted to go that accepted them. The premise was that if they worked hard their choices would be many and they would be creating habits of learning that would allow them to do well wherever they went. Grad School will be a bridge we cross when we get there, but they will leave undergrad debt free and so we will hope there will be more flexibility. While goals are good, leaving oneself open to life and where that leads you is worth pursuing as well.</p>
<p>Our family did the ‘certain amount of money’ available for education, spend it however.</p>
<p>Son completed undergrad at public and will use some remaining money for room and board at masters program that came with tuition scholarship.</p>
<p>There are many ways that this plays out, IMHO.</p>
<p>We did the same-- Son has x number of dollars from us, whatever is left over after the undergraduate degree (currently that looks like about 50k), can be used for grad/law/whatever. Had he chosen WashU, not only would there have been no cash left over,he would have had about 50k in loans.</p>
<p>Our kids have as much money as they want for any type of education they’ll pursue. We saved money specifically for college for each of them, but we really don’t expect to use any of that money for the actual tuition or room and board payments. We’ve promised our kids as much education as they need or want as long as they keep a certain GPA. That includes undergrad, grad, or any kind of professional schooling like law, medical, or b-school. When they’re a certain age, probably 25, we’ll just give them the money we originally saved for thier educations for a downpayment for a house.</p>
<p>BUT–WE got into the position of being able to do all of this for our kids because we never, ever put ourselves in debt. We’ve lived well below our means for a couple of decades and we never buy expensive cars and our house is by no means the biggest or flashiest one in the nieghborhood. We pay cash. Owe nobody. At first this was a matter of severely diminshed lifestyle compared to our friends and peers, and our house was always smaller and our cars were always older–except for a ridiculous foreign sports car H just absolutely needed at 30, and I agreed. He really seemed to need it. He never drives it, but there you have it.</p>
<p>Still, he bought it at garage sale prices and he made it fantastic as his hobby. He loves me maybe a little bit more than that car on a very good day. I’m glad he has it.</p>
<p>The point I’m making here is that people tend to really underestimate the actual cost of debt. To every area of thier life. The advice to not overspend or get into incredible amounts of debt during undergraduate is advice for the student. If the parents, after 18 years of being a parent, haven’t figured that out yet, then they are welcome to spend the money.</p>
<p>The thing to remember is how much your education will actually cost you. So, if you do 200000 in loans–which is ludicrous, then what is the actual cost? It’s a lot more than 200000 dollars. It is the cost of interest. But, it is also the cost of not being able to buy a house, a car, the cost of living an exceedingly diminished lifestyle for years. It is the cost of decades more worry about money and finding a way to save money and even more debt. It is a whole lot more than JUST the cost of the education.</p>
<p>Debt will keep you from being free. A smaller house, less expensive car, less prestigious education, these things let you keep your money. The ability to save and invest is wildly underestimated as the true path to wealth. But, and this is true, it is the only path, and not just for people with high, high paying jobs. For anyone.</p>
<p>I thought I would add this note to the discussion. Almost all of the top law schools count parent assets when calculating student aid. Our DD has not been our dependant for two years–doesn’t matter. They still require parental information. The savings she has leftover from UG (she attended state school) and our meager finances equal no aid money at her top choice school. Believe me, we are not wealthy by any stretch of the imagination. She will come out alright in the end–some debt, and the Law School has a very good income protection program for retiring debt.</p>
<p>There is some wisdom to “saving it for Grad school.” Still the picture is more complex than I ever imagined it would be.</p>
<p>Our plans are to get the kids through undergrad with no debts. Grad school is on their own dime. We were full pay parents at older D’s expensive private. Younger D applied to a MUCH cheaper college alternative. She posed a hypothetical situation: if she went to this cheaper undergrad, would we consider putting the money we saved toward her grad school plans? Probably so, we told her.</p>
<p>Moot point–she is choosing to go to an expensive undergrad at which we are full pay once again. So, honey, grad school is on your own dime!</p>
<p>A graduate school decision that forces students to rely on their parents to fund it (not paid for by the school or an employer and no expectation of being able to pay off loans post-degree) is a bad decision.</p>
<p>Why do you think this? I’m really interested in this thinking.</p>
<p>“Debt will keep you from being free. A smaller house, less expensive car, less prestigious education, these things let you keep your money. The ability to save and invest is wildly underestimated as the true path to wealth. But, and this is true, it is the only path, and not just for people with high, high paying jobs. For anyone.”</p>
<p>In the FAFSA thread, a poster (calmom I think) asked why the upper-middle was so averse to debt especially when those in the middle and lower have to use it. I just replied that debt = slavery. Most don’t understand that and you can’t explain it to them in a way that they do understand that. Look at where the nation is with regard to debt. It’s a problem with rich and poor alike.</p>
<p>Well, if debt is a problem, then you aren’t wealthy. I’ve seen this again and again in our supposedly affluent area…people in massive houses losing absolutely everything because they were so “leveraged.” I believe “leveraged” is the favorite code word for debt among high paycheck earners.</p>
<p>I’ve also seen lower paycheck earners who are quite wealthy. Though you wouldn’t know it from the way they live.</p>
<p>The person I know who inherited the largest amount of money from thier parents had a father who was a car mechanic and a mother who was a school teacher. Debt, or “leveraging” will keep ANYONE from financial freedom, even people who make seven figure incomes. I’m sure you know this, already, but I’ve seen people leverage thier millions until they spent themselves broke. It happpens.</p>
<p>I really don’t think anything will determine future wealth as much as living below your means, whatever those means are, and saving and making wise investments. And, I don’t think anything will give you so much freedom in your life, either.</p>
<p>Anyone can live debt-free. And anyone can sink themselves into a black hole of debt, which really does create it’s own gravity, regardless of income. College is a good place to start to learn how to be free. Imho.</p>
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We ran into this when our 28 year old applied to law school. One of them still wanted our financial info even though he has been on his own and working for over 5 years. They said he had to be 29 before our finances were not considered. He is not going there.</p>
<p>Business schools don’t look at the parents’ finances and they do give scholarships.</p>
<p>We did the opposite. We paid full fare for our kids’ privates but they are responsible for grad schools.Our D who will graduate from a business school next week will have large loans to repay, but it’s still less than her future annual salary. She starts work in July.
DS is not contemplating grad school at the moment.</p>