My son was accepted at Cornell; and the parent contribution was calculated at $35,000/yr for the 5 year architect program.
So we would need to borrow $175,000 ($35,000 x 5) since we have no money.
When he graduate he will have $175,000 plus interest in student loans. The starting salary for B-Arch is about $50K.
The big dilemma is that he’s being dreaming only about Cornel for a long time, and was accepted during early decision
The question: Is this debt too much or is it worthy or we should pull the plug and move on…
Can you speak to the financial aid office? If something big happened since you submitted to FASFA and CSS profile, you can try to get more money. However, I think it would be unfair to let your son graduate from college with a mortgage looming over his head before he even has a job.
Is he willing/able to take $1,000 off the top of every single monthly paycheck for the next 175 months plus, say, another 65 for the interest? That’s 20 years!
If he wants it badly enough, at the very least he should defer admission for a year, work and save some money. If all of you could put away, say, half the cost of the first year alone during that time, the savings to you in interst could be substantial. It would still be an awfully heavy burden, however.
You can’t help him at all? If your ECF was calculated at 35k per year, you must have some money…like income over 120k/yr? Of course I don’t know your family’s situation, but Cornell thinks you have some money to pay. Maybe you should request an appeal…since you have “no money”.
Cornell claims to meet 100% financial need, and while this can still cause hardship, and their packages do include loans, the loans should be much lower (ours is 7.5k per year). There’s a big discrepancy between what Cornell thinks you can pay and what you say you can pay.
That sounds like a problem waiting to happen. I think it’s more likely than not that his first five or 10 years of employment will make those payments very, very difficult. Of course, the family may just resign themselves to planning on making the payments.
we had no idea how much college costs were running. now that we have teens, we’ve been shocked, and its a somewhat disappointing situation as we don’t have a ton of savings for 4 kids. they will go to school, but money talks, and s#1 will go to local flagship with merit scholarship.
we would not go into that much debt anywhere. Nor would we encourage our children to have 175K in loans for an architecture degree. (which our D#2 is looking at). those are just my thots tho.
bgbg4us, need-based financial aid, especially at schools that claim to meet 100% need can be good options. And, the more kids you have in college at the same time, the more aid you get.
The fact that OP has an EFC of 35k per year, means they either have money they don’t want to spend, or can’t. …in which case they should make an appeal.
I think a debt of up to 50k might be acceptable after graduation, but $175 seems absurd (unless maybe for law or medical school).
It seems the parent wants to pay $0 and leave the kid to pay his own college expenses. Why put kids on the earth if you are unwilling to take care of them. Paying zero as a parent…really?
18+ years ago, when the cost of living was that much lower, my husband finished grad school and entered a profession in the middle of a labor shortage. His starting salary was well above $50k. He had just over $50k in student loans. Even with rapid salary increases in a very favorable labor market and in a low cost of living area, it took 12 years of paying extra toward those loans to pay off that debt while living frugally and trying to raise a young family. That’s less than a third of the amount you’re discussing (which will be higher than you now estimate by the time he graduates when you add in accrued interest on unsubsidized loans) and with higher cost of living and lower expected salary. That’s a very heavy sacrifice for a dream that can be had much more affordably at a different school. Sounds crazy to me.
I would think OP would have looked at the financial aid calculator before allowing son to apply ED. They are supposed to be fairly accurate. It shouldn’t be a huge surprise when you get your financial aid packet.
We do want to help him, we even set up a pre-paid tuition plan years ago to pay for in-state college which cover 100% in the state,but he turned out to be super smart and he wants to go to an Ivy League school. We have a combined family income of 125k/yr and own a small family business -from which we make a living. But in the end we live pay-check to pay-check; and we, the parents, are in the 50’s.
Once he graduates from Cornell, the debt should be pretty easy to pay. So long as he gets a good job
I think it would be very unfair to your son to set him up for a $175,000 loan that he will be paying for years. We are on the west coast, but the architects we know are not getting jobs. It is a tough market out there. Of course it could change in 5 years, but in any case $50,000 is not a huge salary to pay off that kind of loan. What if he wants to get married, start a family, buy a house? As someone who makes $125,000 and lives paycheck-to-paycheck, you can imagine how hard it would be to be making substantially less and paying off over $1,000 a month. Your son likely does not realize the consequences of taking on such debt; like most teenagers, he is only looking at the immediate picture. In addition, remember that he can’t take out that loan amount on his own without a co-signer. You could end up saddled with that loan if he is unable to pay due to lack of job or finances.
I would agree with the above statement, if you’re living paycheck to paycheck at 125 a year, how will your son do it on 50 a year plus 1K a month in loans. Someone on this site once said a good rule of thumb on loans is no more than one year of expected salary for the student. You stated $50K, so that would be the max in loans. Of course people feel comfortable with different amounts, that would be too much for me.
Can your pre paid tuition be cashed out or applied to Cornell’s COA?
@Orioles21 “Pretty easy” to repay $175,000 plus interest??? Remember, even if repayments are deferred while he remains in school, he is still accumulating interest. Over time the total repayment will be $200K, $225K, maybe $250K or more depending on whether, and how much, rates go up. Even at, say, 4.9% paying interest only on a $175K loan would be $714 per month. And he’s paying this with after tax dollars, so at least $1,000 of his pre-tax salary would be going to paying just interest, before he even gets to paying down principal.
Well said, Takeitallin! OP needs to sit down with son and show him on paper exactly what it will cost him to repay this loan. And as you said, OP must co-sign and they may end up paying if son is unable. I think son is seeing everything as rosy because he got into his “dream school.” Son needs to see that his dream may turn into a financial nightmare for many years after graduation! $175,000 is an incredible amount of debt to be saddled with, especially when starting out in an unpredictable job market.
Thanks all for your input. Let me add that the original offer was EFC $55,000 and we appealed, and they came back with $37,000. The pre-paid funds will only shave off $2K a year, so we still talking about $35,000.
EFC of 55k for 125k income sounds very high to me. So does 37k. Colleges assume average expenses, so if we have high (optional) expenses (like expensive homes and cars) those are not taken into consideration, although things like #of family members and medical expenses are considered.
Since the goal of Cornell is to meet 100% need with minimal loans, I don’t think they expect anyone to take out 175k loan. It means there’s a HUGE discrepancy in what they think you can pay and what you think you can pay. Why do you think that is?
Our income is very close to yours, and our EFC was about half of yours.
I counted my lucky stars when my DD shifted her interest away from Architecture – have you looked at the job prospects of this field? One of the hardest degrees to obtain – one of the worst job offerings around – for many years now with no end in sight.
Is it possible that there are significant assets which haven’t been taken into consideration? 55k EFC is pretty high for that income and practically full pay.