What does "afford" mean to you?

Parent Cafe
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<p>But why, if you can get the equivalent without the debt? I can’t buy a house I would want to live in for cash. I can buy a car that gets me safely and reliably from point A to point B and pay in cash. I can send my kid to a college where she has the opportunity to get a first-class education and pay in cash.</p>

<p>I would not criticize anyone for making a different decision. (Somebody has to buy the new car and drive the depreciation out of it so that I can buy it used for what I can afford to pay.) But it’s not for me.</p>

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<p>^^Yes, I agree. </p>

<p>For the very large majority, a college is not “affordable” if you define affordable as being able to pay for it without taking on substantial amounts of debt. I’m amazed how many people here have been able to pay for it without taking on any debt. </p>

<p>So, ultimately, it is about expected earnings after you get your degree. The problem with this though, is that earnings is so uncertain, especially in this economy, but most really have no choice but to hedge their bets, work hard, and hope it pays off. If students could all see what their starting salary would be before even starting college, I bet students would be alot more frugal and college attendance would go way down…The large amounts of unemployed/underemployed studnets just reflects the fact that their expectations, regarding employment and salary, were wrong.</p>

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<p>I don’t have any data to dispute that - do you have any to support it?</p>

<p>With the understanding that “college” does not have to mean full-time study at a residential school?</p>

<p>That the “very large majority” cannot afford to send their kids to a community college for two years, followed by two years at a four-year state commuter school? (Yes, I know that geography makes this impossible for some people, but I rather doubt that approaches a “very large majority.”)</p>

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<p>Speaking only for myself, my D had just such a choice. She had two no-debt options - a private school that offered her an enormous merit scholarship and a generous need-based award, and an OOS public that starts at $18,000 COA and that offered a small merit award. She also had two admissions offers from schools that would have required her to take on debt, one a moderate amount and the other a large amount. So she could well have been in the “can’t afford college without debt” camp, but made a choice not to be.</p>

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<p>Perhaps college attendance at pricey alternatives would go way down.</p>

<p>That an 18-year-old is unrealistically optimistic about just-out-of-college earnings is understandable. Unfortunately, so are many parents.</p>

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<p>Not always. I view my D’s college education partially as an investment, but mostly as a luxury good that we are giving to her because we want to, and because we feel it will enhance her life. She may never “make back” its cost. However, she certainly won’t be worse off for it.</p>

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I don’t use “afford” in a normative or judgmental sense. There are cases where it may make sense to purchase something without sufficient assets; for example, if you expect the value to appreciate or pay dividends. In my mind, that doesn’t modify the definition of “afford” to include any situation that makes financial sense.</p>

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<p>I think even for people who are able pay for tuition without having to take on big debt, they still take on big debt in other forms. They could have use this $200k to pay down their mortgage or car loan or increase their retirement savings. So I don’t think not take on debt is a sufficient condition for being able to afford.</p>

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<p>“However, she certainly won’t be worse off for it.”</p>

<p>Not so sure about this. Too many people believe that college is the only way to improve their lives when in fact many would have been much better off going to a trade school than getting some fluffy education from a college.
Germany is much better than us in this regard IMO.</p>

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There are some people who do not have mortgage or car loan, and increasing retirement savings is not the same as taking on debt.</p>

<p>I agree college isn’t for everyone, some people would be better off in going to a trade school.</p>

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<p>Or they could choose a college where they need far, far less than $200K to make it through four years.</p>

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<p>For the one percent the $200,000 is peanuts. It really makes no difference at all. As for us, may be we’ll regret it when we are 80, but if worst comes to worst we’ll just move in with our kids. :slight_smile: After all they owe us!</p>

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<p>What my kid need is going to a school where it offers major(s) and courses she is interested in. Four years is a long time for a kid to waste his/her time, cheap is not always the best choice.</p>

<p>Yes, my back up plan is to have my kids to support me.</p>

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<p>I don’t really like the word afford, because I do think it’s used judgementally. I remember once when I went to a PTA committee meeting and an affluent mother was making judgemental comments about low income mother who had asked for financial aid for a field trip and yet sent her son to school with a name brand orange juice juice box. The whining mother told me in a horrified voice “She has money to throw around like that, she even buys Tropicana. I can’t afford Tropicana!” Later the same mother told me about their upcoming vacation in the Virgin Islands. Clearly she could have afforded a Tropicana juice box. She may not have been able to afford Tropicana AND the Virgin Islands AND whatever else she spent her money on, so she made choices, nothing wrong with that, unless you’re super rich life is all about the choices, but don’t complain about not being able to afford the juice.</p>

<p>I could “afford” to save more for my kid’s college. Instead I spend a portion of my money on things that are what I’d call “simple luxuries”. We have a dog who requires food and vet care. We live in a 2 bedroom apartment in a great school district with a short commute, when I could pay less elsewhere, my kid plays a sport each season and goes to nice summer camps, we own a car rather than taking the bus everywhere, sometimes we like to go out to eat on the weekend. . . . Clearly, I have decided that these things are important, but for me to say I couldn’t “afford” to put more in the 529 is a little misleading. I could, but I choose to do other things with my money.</p>

<p>So, I wouldn’t say that I can or can’t afford a certain amount of college tuition. What I will say is that I’m comfortable with the current level that I’m saving at, and the level I anticipate being willing to cashflow. I would take out debt if I needed to do so to provide my child with certain college experiences, such as the following:</p>

<p>The opportunity to attend a 4 year school as a full time student and live on campus his freshman and sophomore years. For me going away to college was an amazing experience, and I’d like him to have the same.</p>

<p>The opportunity to attend a program where he is challenged and stretched: I have a kid who would likely find a variety of programs, including some instate choices and other reasonably priced choices, challenging. If I had a kid who was at the very top, I’d be hesitant to force him to accept a merit package to a much lower level school just to avoid Staffords. </p>

<p>The opportunity to attend a program in a manner that meant he’d likely to be successful: As I said above, my friend’s daughter will likely need a small private school, and for her parents to pay for LD support services. If I felt that was the only way my child would likely graduate I would borrow to make it happen. Similarly, I could expect my child to work 40+ hours a week to help pay for tuition, but for many kids I think that puts the degree in jeopardy so I wouldn’t ask it. 10 hours? Yes. 20 hours? Maybe. But likely not 40.</p>

<p>The opportunity to attend a program that teaches something he wants to study: I work in a program where I could arrange for my child to get a fully paid scholarship to become a preschool teacher, but given that my child doesn’t love little kids, I wouldn’t do that to him. That doesn’t mean he gets to pick one narrow rare major, but I would like for him to be able to pick from an array of majors. </p>

<p>What I wouldn’t take on debt for, or encourage my child to take on debt for is the “name value” of a school, a particularly desired location, to be with a girlfriend, or for many other reasons. I don’t value these things enough to take on debt.</p>

<p>For my kid, and I recognize that he’s still young and things can change, but for my kid at this point I anticipate that I will be able to provide the things I listed above without going into debt. Therefore I will communicate an expectation that my child won’t go into debt for his degree. It doesn’t mean that I think that taking on debt is always terrible, or that I judge other people who do so.</p>

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<p>^^^ Great post, CuriousJane.</p>

<p>Figuring out what we can afford for our children’s educations would be so much easier if we knew how long our lives would be. The worst-case scenario is winding up penniless at the age of 102, in a publicly-funded long-term care facility. I’ll have long since burned through all our savings, possibly at just slightly less awful senior residences. If this happens to me, I’ll at least have the satisfaction that I provided my ds with the best education we could afford. I’d rather have spent that $400K (ish) on their educations than be just a little bit better-cared for in the last 2.5 years of my life. If we think college costs are out of control, think about what it costs for long-term care (not assisted living or other options for healthier seniors) - more than $12,000 per month in my area. </p>

<p>I like what oldfort said a few pages back about giving her kids their inheritance in the form of their educations.</p>

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<p>I think the tricky part here in talking about “afford” without regard to income level, age, and values, number of children, and spacing. </p>

<p>Example, when some of you mention inheritance it is foreign to me. Neither H nor I have ever had an inheritance, nor will we. We both put ourselves through college. (Curiously I sometimes I feel that was a gift my parents gave me- self suficiency). I don’t save to the point that I will have an inheritance for my children. As for spending $200,000 on an education for my two children (one year apart in age), it is not feasible. If I could in a heartbeat I would. If there were any likelihood of an inheritance for my children, it would all be theirs now. </p>

<p>I just think there is such a wide variety of income levels and other demographics, it is challenging to reconcile what one can afford to what another can afford. Many people have no choice but to take out loans for college and in reality there is nothing wrong with that unless you do not pay it back. Others have scrimped and saved since their children were small. Wonderful! Others maybe a mix of things. However, despite the wide range of income levels, I dont think one decision (loans for a high priced name brand school) or another (pay from current income for a state school tuition) equates to valuing education or our children more or less.</p>

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<p>CuriousJane - great post.</p>

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<p>I would think much of the decision as to whether to take on debt for college may come from where you are in life. If you are nearing retirement, you are probably less likely to want to take on more debt than if you are in your 30’s-early 40’s. The very beginning of a career and the end (just graduating and retirement) are probably the times many would be less likely to choose to go into debt.</p>

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<p>The meaning of ‘afford’ has interested me, as for much of my kid’s lives, I have lived far below the income of many families, yet worked on making us feel less impoverished than the bottom line might indicate. When my Ds were applying, that question came up on one schools FA form. And I thought about how we never ate out, dressed from garage sales as much as possible, took camping vacations or stayed with family only. By doing this, which was an accustomed lifestyle at that point, yes, we could afford to pay more for college. But was this right or fair when other families had a far higher opinion of what they were ‘entitled to’? Was I just being a gold digger by feeling that suddenly I too was entitled to eating out every week and buy new clothes? </p>

<p>Luckily my wages have gone up, and I can work a lot more. So those days are behind me, despite college tuition. Some of us still benefit from increased real estate prices, so an assessment of assets as the house is near pay off makes taking on smaller amounts of debt look less frightening.</p>

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annasdad, don’t type stuff like that while I’m drinking–I might choke.</p>

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<p>“Afford” for us meant choosing a school that we could pay for entirely out of college savings funds with no debt for kids or parents upon graduation.</p>

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<p>However, I would criticize someone for insisting - against the clear, objective evidence that there is zero correlation between prestige (or any other readily available metric) and the quality of the education available - that one school is “better” than another because it is more prestigious than another, or admits a more selective student population than another. (Search my past posts or PM me for citations to said evidence.)</p>

<p>Is that what made you choke?</p>

<p>But I reiterate what I said, Hunt - I’ve never criticized you for choosing to send your kid to Yale - only for insisting that a motivated Yale student gets a better education than a motivated student at a school like, say, Cleveland State.</p>