Should you incur substantial debt for that "dream" school? or an arts major?

Parents Forum
361

<p>Weenie, what I meant was that this is a personal decision for each family based on their values and their resources both. I have met people who can afford college for their kids but don't wish to pay. There are some not willing to borrow. And yes, there are some who cannot afford college at all but then again, those at the lower end of the income bracket often can get some good financial aid and should seek such schools that offer it. I'm not rich. I have not saved for college. My kids are on financial aid. I am not having them personally take out any loans or repay them and am incurring the costs ourselves after scholarships. Some cannot take that on. Some can but do not wish to. Some do not think it is worth it. I make no judgements on what others decide to do within their means and value systems. I don't think others should go on to implore what those who can or wish to pay or incur debt for college or for the arts "should" do. I agree with mythmom that value judgements, along with means, comes into play with such decisions. </p>

<p>Your interpretation of "we have more reources than most," is not accurate because there are some who can afford college or who do not qualify for financial aid who are saying they would not CHOOSE to incur debt or not CHOOSE to go to a more expensive college if a cheaper one is available. Of course, each person's means to realistically pay for the college is a big factor. But that is not all that is being discussed. Considering that my kids qualified for FA and considering we have had to take out parent loans, is a choice we made since we don't have the money in the bank. That choice is not for everyone. Just like others' choices to not incur debt or to not go to a more expensive school because it is not "worth" the money, particularly if majoring in the arts, is not the choice for me. This is without even taking into account one's means to pay. </p>

<p>Some of the discussion IS about choices and values. I believe everyone here CARES about their kids as much as I do. Not everyone is able or willing to pay for the more expensive college, even if they have the money or if it means any debt, and some are not feeling it is worth it for a degree in the arts. That is what I was discussing. Obviously people can only do what they can afford to do. But what one can afford is somewhat tied to values and not just income. One person who earns 80,000/year may choose to spend it a certain way and another person may choose to spend it another way and some think an expense is worth it and some don't. All, however, most likely love and care about their kids. </p>

<p>An example.....I pay for my kids' books and travel at college and an allowance and a clothing budget. Some on CC who have more means than me whose kids are not on FA either, choose not to spend money on those things. They love their kids as much as I love mine. But each has made decisions as to how to use their money.</p>

362

<p>I imagine that every parent and child are happy during their college years at their best fit school, studying what interests them, and that the experience is worth every penny to them. But what happens after graduation? Are students frustrated when they can't make a living in their area of study? Are parents financially strapped when students can't pay off their loans? Notice that I am questioning both the issue of excessive debt as well as the issue of studing in a field with poor employment prospects. I know a few students who just continued to study advanced degrees or even take completely different degrees in order to avoid the day of employment and payments. This would be a very frightening prospect for me. </p>

<p>Before the onslaught of disagreements, let me just say that I agree that each individual, each family, must make these decisions for themselves and decide what they can live with.</p>

363

<p>The element you're missing from taxguy's thread, which I remember vividly, is that he was concerned that parents understand the ramifications of the debt for their own retirements. As a professional, he'd encountered older adults who had insufficient resources for themselves to have comfortable retirements. </p>

<p>For some reason that eludes me, taxguy has chosen the arts major as the quintessential poor-return-on-the-undergrad-investment, although I think he might just as well have seized upon majors such as philosophy, religion or classics as being dead-ends if only pursued up to the B.A. level. So I'm not sure why pick on the arts, when perhaps he's talking about attaining degrees which are challenging employables, as compared to majoring in, say, business, science or engineering which have a more sure pathway to follow. </p>

<p>I'm really not going to argue taxguy's case for him, as his thread speaks his mind much better. </p>

<p>I do want to align myself with soozievt, allmusic and mythmom to attest to the fact that some majors choose the student (like a "calling"); some students and parents inhabit a world where it really is just as good to spend the summer on the back porch as on an overseas trip; kids right out of college (such as my two oldest) are choosing to live in art-happening cities with public transportation so might not own cars for a decade or forever; they have an exemplar uncle who majored in the arts and pursued it at a low-to-the-ground level for a decade before "going bad" and enrolling in law school at age 30; they accept the prospect of living modestly on a material level; they recognize a middle ground between starvation/artist and celebrity/artist and know people who live, work and raise families in that middle-range by combining work as artists and teaching; they hope to marry
eventually but will have to find mates that accept this lifestyle. That rules out many materialistic dates, no loss. As a parent, I endure all the sublimation and am dutifully polite when other parents of graduates boast of their son's apartment/car/trips while I take pride in the ever-increasing quality of productions my S finds himself cast in NYC. It's just...different. My D is currently interviewing by phone for her first post-B.A. job. She's finding her strongest point, the one every interviewer wants to talk about, is her experience with improvisational theater, Renaissance faire work, comedy-improv, and a recent 6-city circus tour. Reason: these demonstrate skills in communication, public speaking/engagement, quick-turn-around, organization, memorization, discipline, creative problem solving and teamwork. If she ever decides to apply for a business job (not yet, she'd say hopefully never) I know she could parlay these performing arts skills into assets for a corporate job just as well.</p>

364

<p>People rarely post with happy debt stories so I'll go ahead.</p>

<p>H and I never had the debt discussion when we got married-- we had good jobs and it never came up. It wasnt' until we tried to buy a house about a year after we got married that we actually sat down with a debt repayment schedule and it was frightening... undergrad, grad, prestigious schools, times 2-- you do the math. Everything cost less back then.... but to see all the numbers laid out was frightening.</p>

<p>However, story has a happy ending. Debt has a way of focusing the mind. We never had the "lets go to Cancun for the weekend" stage of our young married lives; never did the ski weekends like the other young people at work; didn't hire a decorator to do up the place; our furniture still doesn't match. The cars were (and still are) junkers-- but we love Honda's and they seem to run great even after they look like hell. I went back to work after my pregnancies with minimal time off-- the grad loans I had would have allowed me to defer repayment while I was on maternity leave, but the interest payments would be accumulating until I started working again... that was just too scary. One of us always made sure to have a job with good medical and retirement benefits which gave the other one of us flexibility to find something with better hours, less commute, long term stability, etc. once we had kids. We've had brief periods of unemployment, but both of us have understood that we would make whatever trade-offs were required in finding a job in order to have both of us employed as quickly as possible. We've lived in places which were not our first choices geographically but which were neccessary evils for career advancement. Fortunately, these periods were usually limited.</p>

<p>Now most of you are thinking, "oh my god, that's what I'm trying to avoid.... having to go back to work with a baby, living in a place you don't want to be in.... sacrificing your soul for the sake of your job". But guess what-- we paid off our loans early. We've bought houses (traded up, traded down, all of the above) even when interest rates were an eye-popping 12%. We've contributed generously to charities we care about, we've taken care of elderly family members, we've paid for our kids educations (almost.... not done yet) and have a pretty reasonable shot at a decent retirement. We've helped our siblings with their kids college tuitions, we've bailed out cousins who needed cash to start a business or pay off medical bills. All of the above was made possible via debt (and good health and good luck... no divorce, no long term layoffs although some short term brushes with unemployment and under-employment.)</p>

<p>Judicious use of debt is a strategy-- works for some, won't work for others, but it isn't the boogey man that CC'ers like to make it out to be. I am still in touch with a few peope from the neighborhood I grew up in-- they seem pretty content with their lives so I'm not knocking it, but they live near Mom, they live paycheck to paycheck unless they've married fantastically well, they were so afraid of debt for their educations that they opted for "cheap and close" rather than rolling the dice. I'm sure they thought I was nuts for majoring in something ridiculous rather than Early Childhood Education -- but hey, works for them, works for me, everyone makes their own choices in life.</p>

<p>Debt is not for everyone... but I can't imagine any investment which can pay off as much as educational loans.</p>

365

<p>soozievt,
I couldn't have said it better myself. My kids have also had a "calling" in that their artistic passions need to be followed. It's not up to someone on a messageboard to pass judgment on another poster or posters as to where and how they should pursue their educational goals. I happen to know many recent Tisch BFA grads who are working in the "industry" both in NYC and in LA and are making decent pay - they're not working menial jobs just to get by - they're actually working in production companie, etc. in various capacities - using their degrees. There are so many different branches in the film industry, and the grads have so many talents/capabilities that they're being hired in various positions which even include producing (and I don't mean always working as PA's). There are just so many opportunities out there, and I know this for a fact, because both of my kids are working in the field, and they've been able to secure amazing internships/paid positions with growth potential.</p>

366

<p>Well, just to clarify what I meant by "resources," I was thinking about things like job security, health, credit history, marital status, education status, number of dependents, age...all the things, in addition to income of course, that allow some people to take on debt comfortably and others to live to regret it.</p>

367

<p>As others have written, it seems all a matter of values. </p>

<p>I could take out a $100K loan for a home and go to the cheapest college I got into, and 30 years from now I would own the home and presumably it would be worth more (but no guarantee of that). Or I could take out a $100K loan for a top-notch education and rent a place, and in 30 years I would have lived a different life experience (maybe with home ownership included) and $100K will seem like a drop in the bucket.</p>

<p>Reminds me of the "would you rather..." game.</p>

368

<p>weenie: Of course those things help, but I'll give you a story that inspired me. About ten years ago I read an article in the newpaper about a Latino family that was graduating their fifth child from Harvard. Neither parent had a college education; both were first generation Americans having immigrated from Mexico. They earned their livings as service workers. This was in the days before Harvard gave free rides to people in their circumstances. Their solution was to each work two jobs and live in a trailer while raising the five kids. Of course, I'm sure they received generous financial aid, but the amount they had to pay must have been at least as difficult for them as mine is for me. They explained that each kid had had music lessons, etc, and that they were here to give their children opportunities.</p>

<p>I got support and courage from this story. My reaction was, 'If they can do it, I can do it." My strategy was to scrimp and save so we could pay off a sizable mortgage in 15 years. We did this, and then an unscrupulous business manager plotted to take over my husband's business by driving him into unsustainable debt. (Have to blame H here too, for his naivete. I knew said individual was up to no good. To be "one of the boys" H did this behind my back.) There was quite a bit of rangling, economic and legal, to get rid of this guy, and I had to remortgage the house to pay back massive business debt, a lot of it to the baddie. There went all the college money. Poof. Back to square one, but that family has inspired me to find a way to send both children to the schools they needed to go to to become the people they want to be. I did not save my H's business for economic reasons but because he loves it, and I did not want to see him a broken man. For a year I made all the money, helped him run his business and took every extra course I could so I could start a nest egg to send my girl where she wanted (and in my opinion needed) to go. All this happened in her senior year of high school. Not everyone would make the choices I did, but I do not regret them. Although we are not yet in the stable position blossom describes, I have grown, D has grown from working and work study and S is off to do the same. I may even end up with a sane, responsible, confident H. You never know until you try.</p>

<p>I do have a retirement account that I am not touching yet, but I am not growing it beyond mandated contributions. C'est la guerre. I'll probably be teaching until 70 - 75 to deal with all this, but watching my mother still working into her seventies tells me it will keep me young. I don't feel sorry for myself; it is my pleasure.</p>

<p>That said, I do agree with taxguy that I would not want to see kids saddled with debt. Even law school and med school debt scares me, but that will be their choice. I think I'll show them taxguy's figures then since this is in their plans.</p>

369

<p>I'm curious: are we talking about parents choosing to take on debt to grant their children's wishes? Or are we talking about students willing to take on the debt themselves?</p>

<p>Not everybody has a lot of choices when it comes to spending. Some people already vacation in Porchville rather than going abroad or stealing a quick weekend in the mountains or Cancun. Some families already have two parents working and already drive their old cars forever. Rather than giving up niceties, some would be required to give up necessities. You can roll the dice, but the stakes are higher for some people than for others.</p>

370

<p>^^^Along those same lines....To those who say the debt is completely worth it for your child to go to the best fit school for them regardless of cost... what if it all goes bad?<br>
What if you (or your child) takes a large loan and then after one,two or three years, they change their mind and decide this really isn't the place for them and maybe they don't feel that calling anymore and so do the unthinkable and..quit school. </p>

<p>It apparantly doesn't happen much here on CC but in real life I've known lots of people who graduate from h.s and head off to college with great plans that never materialize(including some in our family).<br>
For one reason or another their life changes..they realize this college is not for them, they flunk out, they just plain don't like it, family situations change, etc.<br>
I'm not talking about transferring. I'm talking abut droping out and not going back to a four year school.</p>

<p>I would bet that everyone (here) who takes out the big loans is at the very least assuming their child will graduate from said college.</p>

<p>But what if they dont'? What if you/they are saddled with big debt and no sheepskin?</p>

<p>Would you still think it was entirely worth it? </p>

<p>Would you regret your decision or think the experience was worth it even if the end result was not as expected?</p>

<p>Is it a gift to your child with no strings attached regardless of the outcome?</p>

<p>Do those of you who have/are doing the big loan thing consider this scenario at all when making the decisions? </p>

<p>I don't really have a horse in this race as my kids are/will attend state u's by choice. So I'm not making judgements...just curious about the thought process.</p>

371

<p>lfk, you are so right that everyone's means and finances differ and so the decisions have to take into account what they can afford to pay now or later in loans. Those at the low income bracket and even in the middle income, often qualify for financial aid and so that lowers the cost. But each person must figure out what they can afford to pay now or later and what they are willing to do to make that happen. Some must attend a cheaper option due to their means. But this thread is talking about what one "SHOULD" do, and in that regard, I think if one can or is willing to take on debt to fund an education and also in the arts (I have no idea why the major matters so much), they can and should if they want and can do so. </p>

<p>PackMom.....you ask if this is a "gift" to the kids with no strings attached. I guess in our case, we never had a direct conversation of "strings attached," but my kids have always been expected to do their best in school and to be honest, are self motivated and driven and I just KNOW they want to get their degrees. I guess for some it is a gamble but I have felt all along and still do, that my kids will get their degrees. I have one applying to graduate school this coming year, in fact. But yes, I expect them to do their best in school and to graduate. If they didn't graduate, I still think the experience would have been worth it but I think it is in their best interests to complete the degree. The strings attached are not spoken directly but I know my kids know we would not be pleased if they goofed off at school, didn't finish, etc., but to be perfectly frank, they wouldn't be pleased with themselves if they did that. They already go beyond that which is required at school and seek out further challenges and activities that make their lives more demanding than merely finishing the coursework. They have taken on a much bigger load out of choice. The love what they do and so it is nonissue for us. I guess you can say we have assumed they will graduate but in my kids' cases, it is a very good wager. </p>

<p>For my kid in the arts, who happens to go to college in NYC and COULD audition for shows there and in fact, some good possibilities are always there for the tease, she is ADAMANT about NOT attending auditions because she says she does not want to be pulled away from college and her training and she wants to graduate. So, even if I see an audition she is right for, she opts to NOT audition as she is very into her education. She has had friends leave who are cast. She says she doesn't even want to be tempted by being cast and so doesn't put herself in the situation of even auditioning. That's how much I know she plans to graduate. With my other child, I know she has had a goal to go to graduate school in her field. I guess anything can change but knowing her as I do, I know she means it. She is very driven. For a parent who feels there is a chance their kids will waste the opportunities at college and party and perhaps not finish, then they have to decide what conditions to put on their kid when financing the education and how much of a risk they desire to take. I truly never thought I was risking anything. However, if my kids changed their minds, I will have felt that the time spent in college was worth what they got out of it. Ideally, a degree is the goal but each experience is a learning experience for learning's sake.</p>

<p>Anyway, what I am comfortable with in my financial situation and with the particular kids I happen to have, doesn't mean it is right for the next family. I'm comfortable with the bets I have made on the kids and the choices, even if it is costing an arm and a leg for many years to come. I don't have the money in the bank to pay at one time that those who earn more might have, but I am willing to pay it out over time and find a way to do that. A poor person might have more trouble making that happen, no doubt. Then again, financial aid would be better. On top of this, my kids DO get financial aid, including substantial scholarships/grants, which makes their colleges not cost the ticket price. They go to expensive colleges, yes, but we are not paying the full price.</p>

372

<p>Re: post #370</p>

<p>Three people in H's family were in that precise situation. They attended expensive private colleges for a few years, and NEVER graduated from ANYWHERE! Some accepted the money from the parents who are now in dire financial straits. One defaulted on the loan and declared bankrupcy. Either way, it was a huge waste of money, imo. None are better or more worldly or deeper thinkers because of the experience. Of course, nobody ever expects this to happen, as packmom said, but sometimes it does.</p>

<p>PS - the others all borrowed, got advanced degrees, have repaid their loans and are doing fine!</p>

373

<p>Folks, let me be clear: I am NOT against studying music, art, theater or drama. I am also not espousing any opinion that someone should go to a lower cost university over that of a better, more well known program.</p>

<p>I am simply presenting the monetary cost of making these hard choices in terms of future debt service vs. loss of assets. I simply want folks to think about these issues and make those hard choices which are determined based on each person's values and fanancial needs. Thus, this thread becomes important to at least counter the "top school at any cost" syndrome, which is far too pervasive here on CC.</p>

374

<p>Taxguy, looking at about $20K shortfall between merit scholarship and cost of attending great LAC. We have retirement savings in a VUL life insurance policy that we could tap, but I'm thinking we'll make more on our investment than my son will eventually owe on a loan. Any general guidelines about how to decide what to do? We're only about 8 years from retirement and our CFP got sick and quit. Up creek sans paddle!</p>

375

<p>^ Best you fully understand how a VUL works. </p>

<p>Direct student loans are getting competitive based on interest rates and terms, because of recent revelations. Shop around for the staffords and PLUS loans. Overall and final costs of government guaranteed loans may ultimately be all the same but payment terms may fit your budget. Try to pay interest on PLUS and not to let interest capitalize.</p>

376

<p>


I think that is an important issue, and I didn't see this as an arts-bashing thread. My d. comes from an arts high school, so she has many good friends who are seriously studying arts in college, going for BFA's at schools like Julliard or Eastman. The fact that they are looking at moderate level post-college incomes is simply a reality. Whatever debt they take on does have to be balanced against anticipated post-grad earnings. </p>

<p>The "top school at any cost" syndrome is a problem, because it places far too much weight on a perceived difference between career value of an elite school vs. public. My d. will graduate with a diploma from an Ivy League college; my son will have a diploma from a 2nd rate public. Sometimes my son says to my daughter, "let's trade schools." My daughter alway replies, "let's trade debt." My son has had some excellent opportunities for internships & work, and well graduate with plenty of connections and a head start on his resume for his intended career -- opting for an affordable education is not closing the door on future employment opportunities, it is just setting a different path. </p>

<p>I think its all a matter of balance, and in striking the balance between debt and school choice, looking at the expected level of earnings is simply part of the equation. And that is true no matter what the expense -- the same issue would come up when buying a house or a car. A little bit of debt can be a good thing -- it spreads out the cost of an acquisition over time and it enables a wage-earner to live more comfortably and to make better investments for the future. Too much debt can be a dream crusher that will weigh the person down and limit opportunities for years to come. In the end it's really a matter of numbers: no one should ever take on more debt than they can handle comfortably. If you are going to have to worry each month about making a particularly payment, then the debt is too high.</p>

377

<p>I thought this thread should be read by each new college entrance generation of both parents and kids. I hope you will take the advice given here to heart.</p>

378

<p>Thanks for reviving it, taxguy. I'm on the anti-debt side. Some debt helps people achieve goals, especially home buying. And education is one of the best reasons to borrow. But imho young folks have enough to work out post-college that significant debt ends up being a real burden.</p>

379

<p>Because of choices our son made almost 4 years ago, he will be graduating with high honors from a very well known technical institute(RPI), is applying to graduate schools with about $50,000 of his initial $76,000 college fund intact. And because he was so mindful of his undergrad finances, we will gladly assist him in his graduate studies so he will finish w/o any debt.</p>

<p>If he had attended my alma mater Cornell or similar university I do not believe that he would be in such fortunate circumstances this coming May given the internship, academic program, research and competition opportunities which has come his way. This is in addition to the $100,000 scholarships which he was awarded as an undergrad.</p>

<p>Yep, he was a bit down the prestige food chain as an under grad freshman but the opportunities that opened up to him more than offset any so called ranking benefit from colleges he would have been likely admitted to, and far better off if he had chosen to attend an LAC as a CompSci/CogSci/AI dual major.</p>

380

<p>No substantial debt for a "dream school". That dream will become a lingering nightmare when one is unable to live in her/his own home, take any vacations, choose a less lucrative--in the short term--but more promising job opportunity, etc. because of the need to spend a big chunk of current income on loan payments.</p>