Not for all of us. Just offering a different perspective and data point so I’m surprised it is so common in your world. I’d say the closest anyone gets to that in my world is mentioning mortgage rates and the contact info for their mortgage broker when market conditions called for refinancing. Folks just don’t discuss their rent or mortgage amounts or student loans at all. Price tags aren’t put on things. Debt isn’t something trotted out for conversation and on the other end, neither is one’s net worth and investment portfolio.
Also, and maybe at least partially because of the reluctance to discuss money, it can be very hard to get a read on how affluent folks are - some live beyond their means and like to project affluence they really don’t have and there are others that are truly loaded and you’d never expect it. Could be newly created and/or self made wealth but often it is generational wealth that is downplayed.
Leaving the work force for any reason- unless you are disabled- is a killer when it comes to your financial future. …In many cases their skills are obsolete and in other cases, the industries have just blown up entirely. So now when they really need to be focused on saving for retirement- those alleged “good jobs” are not going to them.
Don’t quit your job. Don’t quit your job. Don’t quit your job. Find another job which is more interesting, offers better work/life balance, pays more, pays less, shorter commute. But voluntarily leaving the work force is a dangerous step, and it may take you years to get back on track."
I’m sure the industry can make a difference and I know my personal data points are few and don’t represent everyone’s reality, but the above isn’t true for all, nor does it have to be. Of all my sisters and SILs, I’m the only one who continued a career after raising kids. The others took 10-20 years off yet are doing VERY well now. They had to pay their dues a little initially but their focus, hard work, and intelligence have lead to successful careers upon returning to the workforce with 6 figure salaries (well into 6 figures for some). They don’t regret taking a break to raise a family.
It is basic math- Everyone knows colleges do not collect full sticker from every family. Instead they have a required revenue/student mark that they need to meet ( average net ). Therefore anyone paying > average net revenue is subsidizing those paying < this metric.
If we look to retail for an analogy, the buy one-get one free sale does not involve in the seller recognizing $0 revenue for the second unit. This is a strategy that nets 50% sales price for each unit- but only when sold in multiples. If, for example, one were to go shopping with a friend and offer the second unit to that friend based on it being “free”, the subsidy to the friend is measured by subtracting the average net price from the retail price ( retail price-Avg net price). Another way of looking at this is the first party paid 50% more than he/she would have under an equal distribution of cost. This is the college model!
It is a well known economic concept of price discrimination.
Of course, those in the unfavorable categories of college price discrimination can quit their jobs and give away all of their assets to move into the most favorable category of college price discrimination (but it is much harder to move in the other direction). But then they may find that most colleges’ discounts for those with little or no money are not as good as they imagine, which is why most students from families with little or no money commute from home to the nearest public community college or university, if they can afford college at all.
@ucbalumnus The issue with subscribing to the birth lottery theory and all the other philosophical nonsense is mindset. If you have the mindset that your parents don’t have much and you won’t either, then you are unlikely to succeed. I wasn’t born with much but I have a lot due to hard work. I always laugh at people who hold the lottery view and try to share it. One of my kids grammar school teachers was trying to sell the kids this thinking. Of course, she had grown up in a very wealthy town and knew nothing about public housing, food stamps or Pell grants. I have found people selling this thinking are usually ones who haven’t lived it. But it sounds like a good reason for not saving, living below your means and working hard. Hey, blame it on the birth lottery-you had no chance and you won’t ever have a chance.
IMHO and in the eyes of the UN, World Monetary fund and others being born in the US equates to winning the lottery. I think the number is something like a million bucks. By virtue of the fact that you live in the US, you are at the top of the human food chain in terms of wealth. Think about that. You can google it. The number is staggering. So I am going to stick with working hard, saving money and not making excuses.
@Happytimes2001 - I think “birth lottery” when it comes to whether or not you have student loans isn’t all about how much money your family has, just how prepared they are to pay for college. There are plenty of kids of high income families struggling with student loans. I don’t make much and we’re a 0 EFC family, but my son won’t have to take out student loans. He won the birth lottery in that regard. It was nothing he did personally.
If the birth lottery of parental money does not matter, then why do parents with money spend it in ways to gain advantages for their kids? After all, if kids without such advantages have equal opportunity to achieve by working hard, saving money, and not making excuses, then spending money on such advantages (buying or renting house in a “good” school area, paying for private school, paying for additional tutoring and other academic enrichment, paying for test preparation, paying for college more expensive than the cheapest one) is a waste of money.
This is not exactly the same. Price discrimination models typically factor contribution margin where discounted pricing > = variable costs. Any funds collected > variable costs contribute to reducing fixed costs. It is also used to increase sales above demand at full/retail price level.
This clearly does not apply to non-profit colleges that decide who can attend and how much they pay.
Actually, college financial aid and scholarships were an example of price discrimination given in economics class in college. The college still needs to entice admitted students to attend, so the use of financial aid and scholarships can influence how attractive the college is to the student, relative to other colleges or not attending college at all. Whether an individual buyer (of college or something else) is profitable by itself to the seller does not change the fact that the seller offers different prices to different buyers.
Reeling from that slap in face says the person who has free school lunch, full PELL and SEOG and thinks a wealthier, even a modestly wealthier, upbringing would have made quite a difference.
@Happytimes2001 - it’s fantastic that you didn’t have much and worked hard and had success, but to act like being born with advantages isn’t a check in the plus column is absurd. I would say children who are dealing with hunger, broken families, addiction, violence, poverty, etc etc are definitely at a huge disadvantage. Many of my classmates throughout my school days were living incredibly hard lives. It isn’t something that can just be dismissed - it makes a huge difference.
@Leigh22 Personally, I subscribe to the everyone has something to deal with philosophy. If you know someone well enough, you will find that they have been dealt some bad hand. Sometimes it’s economic, sometimes it’s health, sometimes mental illness or addiction or really anything. These things are all equal to being born poor IMO. Personally, I think mental illness or a learning disability presents more hurdles than being born poor.
Everything, really every factor in life makes a difference. Some are positive and some are not.
I don’t know if I buy that everyone is dealing with something equal to being poor. And if there is something like a mental illness or a learning disability, the family with money is going to have a lot more resources to combat that than the poor family.
I know our S never talks about loans with his friends. I do know in vet school he has no intention of letting people know that we are footing the bill (for at least 3 years and probably all 4). It is a huge issue for many of his friends. We were lucky to get a moderate inheritance before S was born that we have invested well and at this minute it will cover 3 years of vet school. We have saved enough to cover the other year. He feels it will not be something he is comfortable discussing and it could make others feel differently about him.
I think it’s crazy to think that being born into a family with lots of resources isn’t a huge advantage. Of course one can overcome poverty and difficult family circumstances but the kid with resources doesn’t have to overcome the same obstacles. My child worked very hard in nursing school. But did she have to work as hard as her friends who needed to work as techs during every free moment? No she did not. Did she have the same issues on her plate as her friends who couldn’t afford the textbooks and had to go to the library to get them every day? No. Is her life now easier because we can supplement her income so that she can get an Uber home after a late night shift rather than endure a long and sketchy bus ride? Yes.
"These things are all equal to being born poor IMO. "
Sorry, every other life challenge becomes easier with money.
I’ve got family members managing chronic diseases… doctor recommends the newest biologic which costs 10K per month but which might completely stall the advancement of the disease. The family member with fantastic health care coverage from a good job says yes immediately. The family member with the high penalties for out of network care, and a long, protracted waiting period for a new drug not on the current prescription list doesn’t have that opportunity. I had emergency surgery not that long ago- I took cabs back and forth from my doctor’s visits afterwards, I got additional household help, I didn’t lose a moments sleep that I was going to lose my house if the portion of uncovered costs went above the balance in my checking account. (I had several thousands of dollars of out of pocket costs- which I paid, happy to be able to, and happy to be alive).
Parents divorcing? For a kid from an affluent home, nobody is worried about becoming homeless. Family member with mental illness? There’s an excellent private psychiatric facility near my home. It does not take insurance. It has no waiting list- so male or female, adult or adolescent, substance abuse or anorexia, psychosis or depression- you are in, they can take you tonight. Their intake physicians operate 24/7. They will have a clean and safe room available Christmas Eve if that’s when the patient needs to be admitted.
Oh- did I mention- it does not take insurance? Compare that to the agony that families face trying to negotiate the waiting lists at a facility which will take their insurance, only to discover that the adolescent eating disorder unit is full and the wait might be 90 days- while their daughter shrinks to 80 lbs.
It is incredibly callous AND inaccurate to claim that life’s challenges are worse than being born poor. Being poor exacerbates every other challenge; having money means that at a minimum, you aren’t choosing between your spouses insulin and your kid’s antibiotic that month.
Yes, if you work for the government, in the military, or for a big company with a step/grade system, it’s pretty easy to figure out what a co-worker makes or at least in the ball park. Some salaries are public knowledge, like if you work in city government or are a cop.
If someone believes that foreign travel and beautiful home for themselves and their children is worth it. There’s some real value to this for some people. Good for them. If their children have some loans for college. Or they have to choose a lower priced education because of these choices. That’s ok too. No judgement.
If someone forsakes these things and saves aggressively for a debt free college experience. Hats off to them too. That’s quite a gift. No judgement.
Neither of these scenarios will warrant mentioning in your obituary or tombstone.
Maybe the “loved to travel” bit might get a mention. Lol.
The less judgment, the better. Imho.
However, being impoverished is a big barrier for all kinds of things. As mentioned above.
My feeling is that the students have a sense of things. They are usually very kind among their friend group about these matters.
And like @doschicos mentions, maybe it’s a regional thing in New England. I’d never mention my daughter having no loans to a friend or colleague. Ever.
I do answer questions about 529 plans and starting to save as early as you can when asked. The cost of schools comes up but not how you pay for these or personal finances. Never.
I don’t think it is just children of rich parents who might be reluctant to get involved in these conversations. It could be that they, as a result of merit scholarships, grants, good school choice, parents being smart about saving for their children’s college and working hard themselves, might not end up with student loans. It obviously is a real boon to them. Hard work, good decisions, motivation etc. can often be disguised as “Luck”. I know a good number of students who fall into this category.
For the most part I feel for students who have to take on serious student debt. I cringe when I read posts from students (or parents) here on CC wanting to get into the most “elite” school they can and wondering how they can borrow 10’s or 100’s of thousands of dollars to do so. There’s is a choice not a necessity. If they are part of the conversations going on in the universities or workplace they can look in the mirror and have that discussion.