Correlation between lousy students and amount of student debt?

Paying for College
1

<p>Is it reasonable to assume that the student debt crisis plagues less-than-academically-stellar students far more than more academically talented students? </p>

<p>For academically talented students, when it comes to financing their college education, oftentimes they get options that include generous merit packages at their in-state schools and lower ranked private schools as well as have the opportunity to attend more elite schools with generous need based financial aid policies. (So, for instance, Valedictorian A has options that might include a full merit ride to the University of Alabama as well as a generous FA package from Yale University.)</p>

<p>Whereas a student with less than fantastic grades with an EFC that isn’t indicative of the true financial situation of his or her family (as is the case quite often) has to settle for lesser schools that are stingy both in how much merit money they give as well as how much need based aid they give. </p>

<p>Valid or no?</p>

2

<p>It is true that students with lesser qualifications tend to have fewer low cost choices.</p>

<p>However, some highly qualified students do turn down low cost choices in favor of high cost choices (NYU being a typical example).</p>

3

<p>Seems like there’s always talk about how to graduate debt free and there’s always mention of community college transfers and whatnot, but it seems to me that the easiest and most straightforward way to graduating without debt is putting in the work in high school. That often lends itself to the student maintaining a high GPA along with multiple AP and possibly Dual Enrollment courses, all of which ultimately result in merit aid and transfer credit. </p>

<p>**Obviously not everyone has the opportunity to do exceedingly well in high school, extenuating circumstances, sometimes long term, can damper that significantly. But most kids in high school have the resources, they’re just too apathetic or are too ignorant to realize the repercussions of their actions. </p>

4

<p>well, less than stellar students may be more likely to drop out before getting their degrees, so they will have a harder time paying back the $10k-20k they’ve accumulated. </p>

<p>And, less than stellar students are probably more likely majoring in academically weaker majors, which may have fewer job prospects, or lower pay job prospects.</p>

<p>I think that student loan debt really plagues those whose majors have lowly paid job prospects upon graduation…art majors, film majors, acting majors, and so forth. When someone is waiting tables hoping for their big break, they may be earning enough to keep a roof over their head, but not enough to make loan payments. </p>

5

<p>I forgot about for-profit universities. Its also hard on kids who go to schools that churn out degrees that aren’t worth the paper they’re printed on. </p>

6

<p>It is not as simplistic as you are making it and unfortunately we see on CC and I see every year in my non-CC life what happens when students and families see the cold light of day.</p>

<p>CC can give parents and students a very myopic view of the college going culture as it represents a really, really small section of it.</p>

<p>The reality is that most students in the country attend their local universities and live at home. It is easy to get caught up in the notion of going to college how college looks on TV or being on CC and thinking that everyone is going away to college.</p>

<p>While there are academic full merit (IMO includes, tuition, fees, room, board books and stipends) they are not automatically available or given to very student who meets the threshold for them. The rub is going to be knocking all of the other equally or more talented kid than your kid out of the box. </p>

<p>Most schools also practice preferential packaging to attract the students that they want or need to fulfill the institutional mission (some are just more upfront about telling you).</p>

<p>I think that what parents don’t realize is that stats alone are not telling the whole picture, because you are evaluated in context of your environment. Colleges can fill its schools many times over with high stat kid - STEM kids. But they are also looking to gender balance, to achieve diversity; geographically, racially, economically and across majors. At the end of the day nothing trumps the institutional mission, which changes year over year.</p>

<p>Yes, HYP has “super aid” to the extent that if you make under $200k with normal assets (only your primary resident and some $$ in the bank), you only pay 10%. However, it is not that straight forward for children of divorced parents or have a non-custodial parent, children in blended families, where on or both parents have remarried, self employed parents, business owners, family farms, parents with real-estate other than their primary residence. </p>

<p>The biggest thing that is going to stand between families and Yale is the 6% admit rate and the increasing number of applications that it receives every year, because everyone wants a crack at the super aid.</p>

<p><a href=“http://www.hernandezcollegeconsulting.com/ivy-league-admission-statistics-overall-2018/”>http://www.hernandezcollegeconsulting.com/ivy-league-admission-statistics-overall-2018/&lt;/a&gt;&lt;/p&gt;

<p>Keep reading CC as you will come across many academically talented students who end up with unaffordable options, custodial parents/non-custodial , ex-husbands/ partners who are not willing, can’t afford to pay or don’t feel that the school is “worth” $X or debt. What good is a full tuition scholarship if you cannot afford to pay room, board, airfare, heath insurance and all of the other little misc. expenses that easily add up.</p>

<p>The best thing that any family can do is to use a bottoms up approach to make sure your child has a few financially and academic safety schools (because people like choice) that offers what they want to take, that you can afford (in your situation, you have already stated that you have an uncooperative non-custodial parent, so you must make sure that any option, your child has that you can hold it down by yourself). </p>

<p>You are going to have to put blinders on and look at your singular financial situation and not what someone else got or did not get.</p>

7

<p>From where I’m sitting, that’s not where I see the bulk of the problem. I think it’s unusual for parents (of just about any income level) to contribute more than 10k for school. Many don’t contribute anything. However, most kids - unless they are attending in state options - are on the hook for a lot more than 10k. </p>

<p>The truly below average students that I know mostly start out in community college. A lot of them drop out. On the other hand, the average students mostly attend in state options. Because we live in a more upscale area, quite a few parents I know will pay a decent amount and the kids will borrow the rest. If these kids graduate, they come out with 0 to 40k in loans. They live home a year or two and their parents help them pay their loans off. </p>

<p>And then there are the above average and the really excellent students. Here is where I’ve seen the crushing amounts of debt. These kids have parents who make over six figures. But it’s rare that the parents have more than 30k to 40k per year to contribute to college (and even that amount is unusual). Even HYP won’t give most of these kids enough money to make it work. (We’re not in a super rich area where cost is no option). These are the kids I’ve seen graduate with 80k+ in loans. And in this job market some of these kids don’t do well. And sometimes one of their parents has lost a job and the help they thought they would be able to give paying back a loan isn’t there. Some of these kids have good jobs, but even so, they struggle - they’ve essentially got mortgage payments at 23 years old. </p>

<p>This year, I know a senior who’s going to start Georgetown in the fall. If I were to speculate at his family’s income, I’d put it somewhere between 120 to 150k. (Dad’s income is public record, mom’s a nurse). The father is going around telling everyone his son got a half scholarship to Georgetown. They’re on the hook for the rest. I would be surprised if the parents could pay more than 10k each year. The plan, straight from the father’s mouth, is for the kid to borrow and mom and dad will co-sign. My guess is the kid will graduate with more than 100k in loans. Yikes. </p>

8

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<p>I agree… because in most cases, there isn’t a college fund or there isn’t one that has enough in it to adequately help pay for all the kids in the family. And with so many financially-damaged divorced families, families needing to fund their own retirements, and families who have gone thru stretches of unemployment, many cant just fork over $30k-60k+ per year to a college…especially when there are less expensive options (commuting, state school, etc)…and even more so when the child’s major or career goal doesn’t require a pricey U.</p>

<p>What really bothers me is to see very low income parents with ok credit taking out mega-sized Plus loans so their Johnny or Susie can go to a school like NYU. The “promise” is that the child will pay those loans back. The problem is that very low income folks don’t truly understand how a good income isn’t the same as a take-home income. A single person making a good paycheck gets hit hard with taxes. And has to pay for many of the things that the low income family has not been paying for.</p>

<p>Not related to student loans, but related to benefits that very low income people receive and how it can distort their view of higher incomes and paying back big loans… I met a woman who is very low income (earns about $10k per year). She was with me when I had to pick up some Rx’s for my H. She was shocked as to how much I had to pay since she gets all of hers for free. She also gets her food for free with food stamps. She has Section 8 housing. She gets some kind of assistance for her electricity, water, and her cell phone. She has had two serious back surgeries, which she paid nothing. She regularly gets Rx for her back pain, which cost her nothing. In truth, her $10k income (which she pays no fed or state tax), is really much higher because of how much she gets in benefits. (now, I am not suggesting that this life is better…no it is not). So, in her mind, if she earned - say $40k per year - she would think that she would have plenty of money. No, she would not. She would no longer get Section 8 housing, no longer get food stamps, no longer get free medical, and reduced utilities and cell phone. </p>

<p>So, if she had a son who she had taken Plus loans out for his college thinking he could easily pay them back once he got his big $40k+ per year job, she would find that a big chunk of her son’s income would be already spoken for…rent, food, utilities, clothes, phone, car, etc.</p>

9

<p>Alternate view. The VAST VAST majority of students are not vals and sals from their high schools, some choose lower cost options like community colleges…or work while attending college part time. Many of these kids don’t start college in a four year residential university. BUT some of these “lousy” students become quite motivated and successful in college, and do well.</p>

<p>The Direct Loan student loan limit is the SAME whether you are a valedictorian from your HS class, or are at the bottom of the class.</p>

<p>One thing that is a factor…some of these students do take more than four years to complete their degrees. And some do use closer or to the aggregate amount allowed for Direct Loans for undergrads. </p>

<p>I just returned from a high school reunion. Back in the dark ages, our classes were tracked, with those lower kids all grouped together. Every time I go to a reunion, I think about how many of those lower students are now doctors, lawyers, accountants, etc. to be honest, I’m not sure what our class val is doing, and I don’t even remember who the sal was.</p>