I doubt that Rutgers, Maine, and NH have such different definitions of “need” that this is a significant factor in the debt variations. I think the explanation suggested above is more plausible: debt levels are largely driven by the combined effect of sticker price & aid on net price, except that in this comparison (Rutgers-Maine-NH) another factor is involved (the % of OOS students, who generally face much higher sticker prices and get less aid than state residents with equal need.)
I don’t think it’s a coincidence that colleges with the lowest average debt levels also are colleges that claim to cover the highest percentage of demonstrated need (among top N colleges, anyway). And although it may seem intuitively obvious than “the schools that provide great fin aid do not saddle as many of their grads with much debt”, that observation would only apply to the ~50% of students eligible for financial aid at those schools. It must be the case that those same schools attract a certain number of full-pay students who take on massive debt to pay the high costs. However, meeting a high percentage of need apparently tends to outweigh any effect of that on average debt.
If there is one thing I’ve learned from College Confidential it is that if one isn’t getting big time Merit Aid to mitigate the cost of the high flying $55K+ a year dream school it isn’t going to work unless Mommy and Daddy are paying for it out of pocket. The math is pretty simple. If MA gets th cost down to what a public would have cost anyway then you can go to the High Flying Private and feel like you are getting a bargain and you probably are because that is exactly what we would do if we had MA.
@tk21769, no it isn’t true that it must be the case that the elites take a large number (what does “certain number” mean? 1?) of kids who finance their education with massive debt.
There are families who can pay $260K without borrowing.
Many on this thread have added info on how to keep costs down. If a student does change their major, perhaps they can ‘catch up’ with summer classes while living at home (if available). Graduating in 4 years does keep overall costs down. Planning and thinking ahead is always helpful - and can help keep costs down with processing information and guiding student well. However if a student wants to not work at their academics to their ability, or is not motivated in job/career, why should parents support a student during college years when they don’t have the maturity to utilize the resources?
I am not sure what the actual percentage is, and this is just anecdotal, but most of our previous friends in NYC, paid out of pocket for their children’s college education. I know for our family, we did not borrow anything, but our total out of pocket, for 3 girls, will be over 400k, now that spans over 10 years, and is exclusive to undergraduate education, but I know, we are not the only ones in this boat.
I wonder how many students/families start out not needing to borrow much or anything, but then a 5th (or 6th!) year causes a loss of aid and then suddenly the family must borrow a bunch so that the child can finish the degree.
I think CSUs will only give Cal Grants for 4 years, not sure what UCs do in cases of needing a 5th or 6 year in regards to aid.
I think a number of privates will only provide aid for 4 years.
I can imagine that some students/families start out thinking that they’ll escape with modest or no debt but then a changed major or some other hiccup pressures the family to borrow so that the student can finish.
That said, I’m still shocked by how many middle-class families and modest-income single parents are borrowing large sums of money for their kids’ college choices. They joke about never being able to retire, but we all know that sometimes those things are out of our control.
I’m actually not anti-debt as much as many others here are, but I am continuously shocked by what people will take out debt for. It’s one thing to take out loans if you have a kid who got into Wharton undergrad or Harvard Law (or any top 10 law school) or any U.S. med school AND you know your kid is the type who will stick it out through school and grind through that investment banking, law firm, or medical specialist job – even if it turns out they’re not in love with it. I think in their heart of hearts, most parents know whether they have a kid who will stick it out even if unhappy bc they just are too stubborn or a kid who REALLY wants to make money and will stick it out for that reason vs. a kid who will see others on campus doing “fun” or “interesting” things and say – I should pursue that, and switch fields and search for what they love for years. Taking out debt for the right kid for the preceding types of endeavors actually makes sense – esp. if you run the numbers and the monthly payments are manageable compared to a starting salary.
But then I see people taking 50k in loans/yr for 4 yrs to go to Williams to study English with the hopes they’ll discover their passions along the way. I can see why that type of learning is important and often people in those endeavors are the ones who end up at the interesting places like Google or LinkedIn, but without a defined path – it’s too much of a risk for 200k debt. The same type of learning can be had in-state for a fraction of the cost/debt. Then those same people complain at the staggering monthly payments upon graduation, having to live at home etc.
I’m not sure if Williams is the best example for your analogy. Most often, and stats prove this out, Williams will have students with similar score/grades to students at Ivy plus scores. Further, these same students are often very driven and motivated. Now, if you were making the same assessment to say Lewis & Clark or U of San Diego (and with all due respect), I get what you say–but I have seen William’s kids, without a per se, business degree being recruited for consulting gigs at Bain, Boston, etc…so, I am not quite sure I bite on that example.
Fair point. Williams sends its fair share of kids into IB and consulting in addition to law school, med etc. So bad example. But I think you get my point – there are plenty of full pay privates which do not have the cache to get you anywhere close to a high paying job upon graduation, which is what you’ll need with 200k in debt. I know at my high school Bucknell, Lehigh (though it’s solid for engineering), and Richmond were popular options that were always pretty expensive (at least then I don’t know what their fin aid situation is now). To go to schools like that thinking it would be interesting to major in sociology and minor in public policy and see where life takes you is a bad idea unless your parents can fully fund it; bc if you take out huge loans and end up with a 40k office job, it will take a while to pay them back.
re: being on the 6 year plan- the families I know don’t do a big sit-down during the kids junior year (or second semester sophomore year) and say, "Hey Sally, you took an incomplete Freshman year and withdrew from one of your classes last semester, and by the way, did your adviser sign off on your classes for this upcoming semester and tell you that you are on track to finish your major, write your required senior thesis AND complete the Gen Ed requirements in time to graduate?
No. The kid flounders a little Freshman year. Everyone chalks it up to adjustment or growing pains (but nobody asks the question “what happens to your incompletes if you don’t finish the work over the summer?”) The kid gets mono in October of sophomore year- hey, it could happen to anyone. But decides that rather than get a C on a midterm (or worse) that she’ll withdraw from the hardest class. Parents want to be supportive not punitive- kid is clearly not operating at full throttle for a while. Mono stinks.
So it kind of creeps up on you. Before you know it you’ve got a senior who has junior standing; kid discovers that the 4 on the American History AP just booted her into a higher level history class but isn’t worth any credits, and now it’s meltdown time. “Hey mom and dad, if I do summer school I can make up the Gen Ed credits… but unfortunately none of the classes I need for my major are offered during the summer so I’ll need one more semester, OK?”
And before you know it, one more semester becomes three more semesters and oh by the way, kid hates the original major so it’s no great loss but “hey mom and dad, if I switch over to the school of education it will only take me three more semesters to graduate”.
Oy. I know so many families up to their eyeballs in loans because when the end goal is in sight (i.e. kid is allegedly a senior) you’ll do anything to get them over the finish line. But the structural issues- kid unable to manage a full academic load, kid unwilling to sacrifice social life for studying, kid ill suited to the major, kid unable to get real help (from a professor, TA, tutoring center) and instead drops the class when the going gets tough- these issues don’t get addressed Freshman year when they should. So the kid limps along passing two courses or three but needs an extra year or two of tuition to actually get a BA. And Mom and Dad get the loan- what’s the alternative at this point?
Williams has great fin aid, so it is unlikely that you have seen any such people. Moreover, no 18-year old can obtain that kinda loan – it requires a parental signature.
All three have great merit aid. If any students are graduating with $200k in debt, they are extremely rare (and beyond stupid).
I think some of the debt recently is also attributable to kids going for degree after degree without a real plan or goal in mind for jobs, and parents supporting that endeavor – or at least not strongly advising against it. I know someone who recently graduated William & Mary undergrad with a public policy/gov’t type of degree. She’s from the DC area originally, so it would make sense to try to get into a gov’t job, think tank, policy job – at a junior level; she could commute from home if she needed/wanted to. This isn’t a kid who looked for a job, didn’t get one, and just decided to get another degree. Instead of even looking for a job, she has signed herself up for a masters in public policy from one of the DC area universities – a brand new program that was just created in recent years, so it has no real track record re employability. When talking about what she’ll do after or how her masters will help – the answers are along the lines of – I don’t know, we’ll see. It sounds very much like – I’m trying to delay the real world for 2 more yrs, now I don’t have to think about a job until 2017. That would be all well and good if this masters wasn’t costing 50k+/yr for 2 yrs.
I see nobody taking out huge loans to go to Williams.
I see LOTS of families in debt up to their eyeballs for a kid at Hofstra who seems to be on the 6 year plan, or a kid at BU who started in the school of education but decided late in the game that a career in counseling was really what was of interest, so he/she added a second major in psychology except that psych is in the school of arts and sciences and oh- by the way- that freshman statistics course doesn’t count for a psych major who has to stats for social science majors which is much more rigorous than the elementary ed version so maybe he/she can take a summer class at a local U which is “only” an extra 5K in tuition (what a bargain), but then that kills the possibility of a summer job.
Etc.
Your Williams scenario is manufactured. Their aid is generous and their graduates are highly employable. And from what I’ve observed- their academic and career counseling is fantastic. They don’t have the Hofstra/Adelphi/BU/ problem of kids in debt for vocationally oriented degrees when the kid decides they HATE that vocation. I know a young woman now getting a doctorate in counseling on top of a Master’s in Social Work on top of a BA in Elementary Ed. Has quite literally never had a full time job (other than student teaching). She and her parents will be paying off the loans for the rest of someone’s life…
Didn’t realize there was so much love for Williams. Again my apologies. But there are people taking out debt even for prestigious schools which does not always make sense esp when there is no desire to pursue one of the career fields which pay a lot.
@bluebayou – I work with this age group a lot, and they are “kids” mentally when it comes to personal financial planning. (Not every single one of them, and I’m sure all the kids of all the CC parents are different, but generally speaking). Even when you break it down simply, they don’t understand that you need to look at the monthly amount you’ll be paying back vs. the salary you anticipate making. I’ve seen many say – oh – I know $1000/month is a lot, but I expect to get a MUCH higher paying job than average, yet they can’t articulate why they will be the one exception in the face of career services statistics from their school for the last 10 yrs. It’s very much of a – I want this now, it’ll help me out somehow, I’ll worry about the specifics later – mentality that you’d expect from a teen, not a 21 yr old. And they are “kids” insofar as parents co-signing for loans, which I have seen for grad students.
Well, I am not sure how enamored we are with Williams, and I am only speaking for myself, but Williams is just an outlier on many different levels. I think, one it has a highly qualified student body, and its depth of class, is competitive with most any school nationally. Moreover, it is almost exclusively an undergraduate school (exceptions are the masters in Art History and Economics) and thus its rather large 2 billion-plus endowments supporting a little over 2000 students, goes a long long way. As previously stated, and at the risk of being redundant, Williams is not the best school to offer as example, and is sort a class onto itself.
in general, grad students do not need co-signers for grad loans, which are available from the feds up to the Cost of Attendance.
(not disagreeing with your points about the foolishness of assuming all of that debt – DC is a special place that ‘appears’ to reward advanced degrees – but if we are gonna fix the problem, we need to be clear on the facts that contribute to it. In this case, unfettered access to gubmint money.)
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Oy. I know so many families up to their eyeballs in loans because when the end goal is in sight (i.e. kid is allegedly a senior) you’ll do anything to get them over the finish line.
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I think this is happening more than we think. Yes, sometimes because of mono or a bad frosh year, but more often because of serious major changes (few overlapping credits), dropping classes, not taking classes at “bad” times, not staying “in sequence,” and simply not paying attention.
Lots of schools have online “finish in four” programs that parents need to be looking at, too.
Kids often don’t realize that FA stops after 4 years, etc. Heck, I know a kid who wanted to delay graduating by a semester so he could still get student priced football tix for fall. How short-sighted is that!!??? But, impulsive and short-sighted kids with little value of the dollar will make mistakes like that.
I’m also surprised how many people don’t realize that altho 12 credits is considered “full time”, it’s not enough to graduate in 4 years if that’s what you’re taking each semester.
I know a family who didn’t look at the residency rules and somehow thought that by buying a condo in the college town and having their DD get her license in the state would give them instate rates for soph year on. NOPE! They had been banking on that. They thought that they were being smart by investing what was supposed to be the OOS portion of tuition and R&B on a condo. Now they’re really stuck. They can’t just have their child come back home because the condo commitment is there. Very likely they will have to resort to Plus loans or similar.
Maybe it’s just me, but I rarely feel bad for those types of people. If you can’t check the school’s in state residency requirements before you sink a down payment into a house and tie yourself to a 15-30 yr mortgage, then I guess you had it coming. Same with these “kids” who can’t be bothered to check and double check their coursework requirements starting as frosh. How hard is it to know exactly what classes are needed for your major in what sequence and then register for them that way – perhaps even allowing yourself to get the required but small/hard to get into classes out of the way a semester or two early so that you’re not scrambling at the last second only to find out that you can’t graduate with Education 319 and that class is only offered in the fall, oops!?
Education is a purchase like anything else – whether you are paying for it in full or taking out loans for the whole thing. I highly doubt people would buy 240k worth of stock without knowing exactly what they were purchasing and taking measures to diversify, minimize risk etc., yet when it comes to a college degree people lose all common sense.