Should you incur substantial debt for dream school or even pay the "dream" tuition?

[dt123]

Re #152:
Consolation, what is that same reason you don't see both statements? I think you may be making an interesting observation but I do not get it.

In my statement, good parents spent a lot of money for name brand education for a slacker kid that did not benefit as much as he should have. A pearls before swine scenario. We never hear anyone admit to that.

In your statement you have a good kid who is receiving a slacker education due to bad advice from slacker parents. Pearls and swine reversed.

[cellardweller]

Most need based financial aid is based on your annual AGI (adjusted gross income) that you report to the IRS. Adjustements are made based on your assets. Home equity is treated separately and included by some schools and not others. Most cap home equity so as not to disadvantage students from areas with high cost of living. At HYPSM and other well endowed private schools you still get some financial aid if your income is as high as $200,000 and have "typical assets". Some schools provide aid in grant form only, some others in the forms of grants + loans. Most of the information is available on each school's CDS, published annually. For many low and middle income parents it is actually no more expensive to attend an elite private school than their local public university.

[kelseyg]

The key phrase is *for some low and middle income parents*, and of course that's not the discussion here - I think it's assumed that if you can afford a dream school then everything's peachy.

[Christcorp]

People have to read closely at the "Stats". Many times when they show stats of the percentage of students and how much aid was given out, many times they don't explain that it's sometimes figured after family contribution. Or that the percentage for that school can be as low as 30% getting aid. So, they say that the average yearly loan for a student is only $5,000. That's great. They gave a $25,000 grant. But they sometimes don't tell you about the other $25,000 that was the family contribution. Not always; just saying you need to know what the stats really mean.

Now; the question has been asked; why count family contribution? After all; that was saved specifically for that. To answer you; you are correct. But remember; the original question asks about "significant debt". If you have saved for your kid's education; then you probably started it when they were born or somewhere around there. A simple $100 a month contributed to an educational IRA at a modest 8% will turn into about $41,000 in 18 years. @ 12% around $65,000. This doesn't include the tax advantage. The point is; if this is how you were thinking when you got married or decided to start an education savings plan for your kid, then that's great. If you were think mega LAC/IVY/etc... school, then you probably put even more into it. As such, you did well. But your question is totally irrelevant. The reason being, if you did do such a thing, then you probably aren't going to confront "SUBSTANTIAL DEBT" for your kid to go to college. Therefor your question is irrelevant to this discussion. The original question; which I wish people could remember for more than 3 minutes; is if it's worth incurring "SUBSTANTIAL DEBT" to go to that dream school.

So; back on target. Simply put; If you didn't start an educational savings account. If you aren't financially well off. If you don't have a rich relative paying for the kid's education. If you aren't expecting an inheritance. Bla, Bla, Bla,.... Then chances are that you as the parent or as the student is going to have to come up with about $25,000+ a year for many of these high priced schools. (NO, YOU CAN'T SEPARATE THE DEBT BECAUSE YOU FORCED THE PARENT TO PAY FOR IT AND NOT THE STUDENT. IT'S STILL EXPENSE). If you HAVE THE CASH, then it's NOT DEBT. IF you the parent or the student has to borrow it on your house, assets, traditional loans, etc.... then it's debt. The simple answer should be NO! You shouldn't go into debt. However, if you are not going to head that advice, then make the STUDENT assume the debt; not the parent. The student has more time to pay off the loan. The student doesn't have to pay for the OTHER KIDS in the family. The student will appreciate their education and the value of a dollar much more.

I think that is the problem with this topic. Too many people not understanding the concept. If you saved for your kid's education for 18 years and are sitting there with approximately $50,000 - $100.000 for that education, then you have probably covered the majority of the family contribution of $12,000 - $25,000 a year. Plus some. Add to that other aids such as grants, you will probably be good to go. At the worst, you might have a $3000-$5000 per year debt. That isn't "DEBT", that's a car loan. Big difference compared to the parent who didn't save. And for what it's worth, most parents didn't put that kind of money away for their kid's educations. Whether they SHOULD HAVE OR NOT, is another discussion all together.

And that brings us back to the question of accumulating $100,000 or more; either the parent or the student; as a debt for the college education. FWIW; low income families have a much better chance financially of getting into the high priced schools than a middle income family making $100,000 a year.

[twinmom]

dbwes - They factor in your assets along with income. However, the packages are not all grants - unless your income is along the lines of $60,000 or less.

[Consolation]

dt123--I didn't get the implication of a student slacker scenario from your original post.

In my view one is equally unlikely to see such posts because people do not enjoy broadcasting to the world that they feel they have made a mistake. Mistakes can be made in both directions: impracticality, and being TOO practical.

[ClaySoul]

just for the record, i plan to take my art major and be a professor, and that pays plenty fine!!!

[ClaySoul]

a professor WITH a side biz, at that...



nngmm: come on, people go to swarthmore for prestige. it has PLENTY. AWS anyone? Those "in the know" know swarthmore

emerald: of course not, that's because Amherst and Ivy's both have a lot of prestige. HYPSM, AWS. Don't get all flowery like LAC's don't carry prestige too.

If you're saying Ivy v say Clark College or Willamette or whatever/wherever, then you actually have a point.

[nngmm]

come on, people go to swarthmore for prestige. it has PLENTY. AWS anyone? Those "in the know" know swarthmore

Yes, people "in the know" know, but I doubt your next door neighbor does. People who get into AWS almost always get into schools with more name recognition among general public as well. The reason they choose AWS is usually not the perceived prestige. (Again, those schools have a lot of prestige in academic circles because of the quality of education they provide. But most people in the "real world" have never heard of them.)

[EMM1]

"Again, those schools have a lot of prestige in academic circles because of the quality of education they provide. But most people in the "real world" have never heard of them."

The people who know about Swarthmore (like Amherst, Williams, Pomona, Middlebury, etc.) are the decisionmakers who matter in this country. It doesn't matter that much whether John Q. Public knows--it matters that the people who do the hiring know, and it is their business to know where the smart kids go--like the Ivies and the most selective LACs.

Now, one might well argue that a very strong academic record at a flagship state U. also impresses those people. I have great sympathy for that argument, but that is a different issue.

By the way, I still haven't seen the hard data which supports the proposition that one gets a "better" education at Swarthmore.

[originaloog]

Claysoul, I doubt that you have any idea how difficult it is to land a coveted tenure track faculty position. For every terminal degree graduate on the tenure track there are many more who fail to ever achieve that goal. I know in my department we typically receive in excess of 50 CV's when a position search is advertised.

Please read the following article posted in this forum to get some idea of the challenges our terminal graduates are encountering.
College Temps Carry The Load In Florida

I am not saying that you should not go on to graduate in hopes of someday becoming a tenured college professor. However you should proceed with a full understanding of the challenges you will face. I would recommend that you talk to your advisor and a few instructors who know your talents well about your future plans. I trust that they will give you good advice about this.

[oh,shenandoah]

A close relative so wished he hadn't accrued that debt at Hopkins, and instead had gone to the state university.
Another close relative stated that his son did meet his wife while the son was at Harvard, so it wasn't a complete waste.
A physician I knew on the staff at a local hospital noted when I asked (I knew where each physician had gone undergrad) that he didn't discuss with others that he graduated undergrad from Harvard. I knew why. The other physicians who attended the southern state's flagship university as undergrads were all so negative/offended that another physician had graduated from an Ivy League. The issue of peer envy was a biggie and could affect subsequent referrals, etc.
On the other hand, my sister works at a government job, and noted that they won't even evaluate an application if the applicant for the job didn't attend a well-known difficult school as an undergrad--this included U. of Maryland, which has a surprisingly good reputation these days. So name recognition counts for something in that setting.

Just my 2 cents.

[EMM1]

Claysoul,

Not to mention that even most tenure track positions in the arts don't pay well AT ALL. But I wish you luck in pursuing your passion.

[scandal-less]

no, it's not. i go to an exclusive, private, VERY expensive LAC... and i know some students, even with financial aid, cannot afford to be here. i personally know of one student who works from 11pm to 5am everyday just so he can be here. he's tired in class and i'm pretty sure this will not go well...

he's a music major. and our college's music department isn't the most fantastic. but the college has a great reputation.

personally, if i were him, i would go to a state school with a better music program, and not have to slave at work. oh, and did i mention, he also has an oncampus job

[nngmm]

By the way, I still haven't seen the hard data which supports the proposition that one gets a "better" education at Swarthmore.

I am not sure what kind of data you are looking for. I think med school/law school/grad school acceptance rates and Phd production should count as hard data.

As for anecdotes, I read this on the Law School forum "What are the main differences between undergrad and law school?", and thought that "what the Law school is like" on this thread sounded very much like what Swarthmore is like. And Swarthmore definitely is not anything like the "college" mentioned in that thread (which is supposed to be a "typical college"):

2. College: Your assignment for a class is to read a chapter in a text book about 20 pages long, often takes less than an hour and you underline important parts and understand what you have read. Law school: Your assignment is to read 20 pages in a casebook along with reviewing numerous questions at the end of each case. You read it once and you have no idea what it is telling you. It is, in the words of Scott Turow, author of One L, "like trying to stir concrete with your eyes." You read it again and still have no idea. You keep going over and over it and after about five hours you think you now understand it and you do that for each class (but now go to 3).

3. College: You go to class and get a lecture, which you understand, and take notes and those notes become what you will need to study for the exam. Law school: You go to class and the professor calls on you and starts asking questions designed to see if you understood and can apply what you have read to hypothetical situations. Two minutes into that exercise, it becomes apparent that you didn't understand a word of what you read and you feel lost and embarrassed. That lack of understanding continues for about six weeks and then eventually, if you are one of the ones who will make it, light bulbs go off in your head and you suddenly understand what you read during the first week of class. You spend the rest of the first semester always feeling like you are five weeks behind on the learning curve.

4. College: you have at least three exams per semester that count toward grade and you may also have homework or other things, like quizzes, that count toward grade. Law school: your grade depends on one thing only -- how well you do on the final exam, the only test you get and the only thing you turn in all semester. To be able to do that exam, you will have needed to have made an outline of everything you learned during the semester and that should be something that is started early and continuously updated as the semester progresses.

5. College: students who actually go to class and study will pass; failure is usually due to not doing those things. Law school: you can go to all classes and study 80 hours a week and still fail despite that 3.7 GPA you had in college.

6. College: lots of free time during the semester, party on the weekends, not too much worry you will make it. Law school: enormous hours spent out of class trying to learn and understand the law, it starts to consume you and you start dreaming about it. Always worried, in first year, that you are not making it. Your one weekly release is Friday afternoon and evening after the week is over and you go to a bar with numerous other law students and drink yourself into a stupor while discussing law with those fellow students.