I am a few years away from my kids being in college. I have a decent job, but I am considering looking at lower paying jobs at a university that gives free tuition to staff and participates in the Tuition Exchange program. Question is, is it worth making less annually and having less of a career path available to be able to take advantage of this benefit in the future. We can pretty easily afford for them to go and live at in-state college, although we are not wealthy, but have worked hard and saved up for it, we will also not qualify for any financial aid at all. I am wondering if the kids might get a lot of that benefit in merrit on their own so it’s not that beneficial for me to factor this tuition benefit heavily into the decision? Thanks!
You need to check. Some colleges require employees to work for them for longer than a few years to get this benefit.
In addition, tuition exchange does have some limits, and not all colleges participate.
In addition IIRC there is some tax liability for receiving this benefit…but I could be wrong about that.
I would be there in enough time, but I of course would not be high in seniority if that came into play. I don’t think there is any tax liability. Actually the tax piece is a big perk, because we are in a higher tax bracket and i’m a second income so it would be great tax free income in a sense, but still weighing the pros and cons of making a job move for something like this.
If you unexpectedly became a single parent would this lower paying job affect your ability to support yourself and fund your retirement?
I suppose potentially it could, but a university job also very much likely will have a better work life balance… so pros and cons.
What if your children don’t “fit” the school? What if they don’t go to your university? Would that be worth it to you?
Just thinking “aloud”, much as my kids would have blurted out.
I have three VERY different children who had/have had three VERY different college experiences.
Had I continued to teach at the university level, I doubt that any of my children would have wanted to attend the university where I have worked. They had mixed feelings when I taught at their high school.
What if your kids aren’t selected for tuition exchange at the colleges of their choice when they apply? That happens.
One of your kids decides to go to a Service Academy (they are free). So no benefit. One of your kids decides to go ROTC to a college which doesn’t participate in your exchange. No benefit. What if your university decides to downgrade or eliminate the tuition benefit (it happens) or what if a change to the tax code makes the benefit almost a wash with the increase in taxes?
I see your plan as filled with downsides and only a narrow window of upside (the plan stays the same, your kids want to attend the college you work for, or qualify for full TE at one of the exchange schools, your kids wouldn’t qualify for merit aid at a college they like more, or your kids won’t qualify for a “meets full need” need based aid college, etc.)
Lower paid jobs also get a lower contribution from your employer and/or allow you to shelter less money for retirement. For a year or so, that’s not all that meaningful. But over the course of a decade (if your kids are now 12 and 15, you need to be making a ten year commitment so your younger child finishes college) that can amount to a LOT of money which did not get set aside, pre-tax, for your retirement. That’s likely a bigger hit than the extra money (potentially) you’d get from TE, no?
Do NOT change your career for the potential benefit of tuition exchange. If you happen to find a job at a college or university you would enjoy, go for it, but otherwise, no. For years, I heard how lucky I was because my kids got free tuition. Yes, it was nice, but do you know how much more money I’d have in my 403b or just for spending if I’d earned more? If i’d have earned more, I could have saved more, and sent my kids to the state Us with no problem. I work at a college because I like what I do…a lot.
I agree. Don’t do it. College is a few years but giving up that income might be for the rest of your career. And tuition benefits can suddenly be reduced or taken away.
We did this exact thing. My husband worked on a grant at a college in a nearby state. Job came up at a TE school and he took it. I have S19, D20 and D22 so time will tell if it was worth it. Hubby was a stay at home dad for about 8 years so we had already forgone his higher earning potential. I also work at a state college but our tuition benefit is limited, very limited. We are still early in the cycle so time will tell if he received the benefit at all of the schools in which he applied (and if he gets in) He already has one at full tuition but had previously received $27k in merit. Not sure how that will, or more likely won’t, stack. Some of the popular schools are almost impossible to get the benefit. BU, Tulane, and UPitt come to mind.
I’ve learned a lot about the tuition exchange in the last few years. One thing I didn’t know before is that many colleges treat tuition exchange as another competitive scholarship that they are able to give out. I remember researching one college (Occidental?) that said they gave 2 scholarships per year, out of 80 applicants. As a general, but not fully accurate rule, the more selective and/or popular a college is, the harder it is to get the tuition exchange benefit. Many of the most desirable colleges also only give the set rate, which leaves quite a bit (typically between 25K and 40K) in cost of attendance for the parents to cover. I also found that many of the colleges will offer merit aid similar to their TE benefit.
That said, there are also some real gems that offer full tuition scholarships to a good percentage of students: Trinity University in San Antonio, Saint Louis U (if you forgive me saying so!), Syracuse (though that may be changing), Gustavus Adolphus, Austin College…
If you are seriously considering this, I would study the list of colleges on tuition exchange very carefully in order to determine whether it will really be a benefit for you. I spent a lot of time getting a spreadsheet with information on TE colleges in one place. You can find it here:
https://github.com/speegled/tuition_exchange/blob/master/data/final_data.csv