<p>A little empathy for those wage earners in the 150 k range is not uncalled for. Many of those folks are forced to pay sticker price and they are not rich. Many are older and closer to retirement and have taken huge hits on their 401’s. Not to mention their children’s college funds and their homes. Many wage earners are in this “enviable” position, not because their salaries are 150 k but because they have scrimped and saved for many, many years and so have some investment income. They have forgone vacations, restaurants, family outings, new cars, luxury homes and stayed away from credit card and other debt.
Private college costs must be affordable for those people that do make good wages and save or how can college costs be made affordable for those can’t save? In other words, the system relies on parents in upper income brackets supplementing those in the lower (just like our health care system). If upper income people are forced to select state schools because a private education is unaffordable then it is time to address the fasfa guidelines for expected parental contributions.</p>
<p>I agree, thecheckbook. I have one daughter who is at NYU for one semester. She is talking about transferring from her state school to NYU. The daughter that is into MT is thinking about Tisch and oldest child has applied to transfer to NYU for business. That makes a grand total of 3 kids at NYU. I feel like we’ll be in the poor house. My daughter said most of the kids she knows are receiving loans from NYU. I was hoping to pay for all of their school. But wow…I wasn’t expecting this grand total. And the FAFSA…we didn’t get much on that!</p>
<p>I have read CC for seven years and not just the MT forum by far. I have seen families who don’t qualify for need based aid but they are unwilling to take out loans and so they are assuming it all must come from current income and of course it is hard to come up with tuition out of current income unless you are quite well to do. So, someone in that income bracket should be able to afford loans, in addition to some savings and some current income to pay for college. We make less and are paying for loans so I would think someone making more should be able to take out loans if they are willing to. Also, if you have THREE in college at one time, the FAFSA should be more favorable, if you make in the $150K bracket. I know when we have had two in college at once, our financial aid offers got a lot better. Some schools, however, like NYU, do not meet 100% need based aid. Other schools, such as my D’s school, Brown, do meet 100% of need based aid. I have a child in graduate school for a 3.5 year program right now where no aid was given. It means a lot of loans we have to take as we are paying for our kids’ education; they are not. We do not want our kids straddled with loans when they graduate. We will be paying for a lot of years for this education as it doesn’t all come out of current income by a long shot.</p>
<p>The cost of a college education is hard to handle for nearly all families. Many of us are juggling multiple kids in college, trying to save for retirement (which isn’t that far away), supporting parents whose retirement income has been hit hard by the current investment crisis, and on and on. This is making state universities more attractive because they are often so much more affordable. My D could go to our local university with some merit scholarship for under $5,000 per year. Of course, she (like my older D) wantes to go away to school and I completely understand and support that. My older D was a college athlete and received full scholarship offers from all her recruited schools EXCEPT USC – where she received nothing but an offer to be on the team. But it was her dream school – leaps and bounds above all other offers. We sat down and had the tough talk. We had saved enough in her college fund to pay for half of her costs. We told her she would have to pay the other half if that was really what she wanted. And she did. Luckily, we had enough in savings at that time to front the loan for her. Times are tougher now, so I hope we can do the same for the younger. Again, luckily, she has received from very nice academic scholarships from some of her schools, but nothing from others (USC again!!!) It is a sacrifice – but I have no regrets about spending the money to send D#1 to the school of her dreams when she was accepted there. She has loved every moment. It was the right decision, albeit an expensive one.</p>
<p>I agree. That said, it still would have been easier when the two kids were thinking about staying at UVA and Tech. In my heart of hearts I wanted to pay as we went with no loans and I do not want any of them to have loans when they get out, especially the MT kid. If they wanted to go on for more education, it would be on their dime. I hear what you are saying, but the FAFSA didn’t give us much…so I guess it will be some loans.</p>
<p>The problem is a matter of perception. For many people $150,000 yr is a lot of money. Where I presently live, you can live VERY well on that amount. Where I used to live a 1800 sq ft, 3 bedroom bungalow, no family room, on a 50 X 100 lot sold for $1 MILLION. With 20% down the payments just for mortgage, taxes and insurance was over $70,000 annual. Income tax on that income is $55k. Right there you are up to $125K of that $150k gross. These aren’t rich people - far from it. The salaries in certain areas are high - because the COL there is high - but the salaries still don’t cover the COL and in some areas making $150k means being in debt or living hand to mouth. To give you a comparison - where I live a salary $150k in my last area they pay $100k here BUT the house I described above costs $150,000 here - so you can figure out the difference. </p>
<p>This illustrates the problem above. FAFSA may think $150,000 is a lot of money and it is if you live in certain areas. If you live in other areas, it’s nothing.</p>
<p>You said it perfectly!</p>
<p>Racmom, you have been lucky to so far not to have to take out loans. Those who make less or are on FA, have to take out loans. So, I would think that those who make more, can afford some loans if they opt to take them, even if they don’t wish to take them. </p>
<p>IMHopeful…I hear you. In our case, we did not use cost of attendance in the decision of where to attend. If our kids got better offers at certain schools, we still let them pick the school that matched them best since they had worked so hard to get there and we just have to figure out how to make it work. Ironically, in D2’s case, NYU gave the biggest scholarship of all her schools but we did not weigh that in her decision of where to attend. In D1’s undergraduate case, she got merit awards from safety schools and even a free ride but she chose Brown. Brown doesn’t give merit awards (no Ivy League schools do so) but she got need based aid which shot up her second year when D2 entered college and we had two in school at one time. Now, Brown has a much better deal that we missed out on by just a year which means that those in our income bracket will not have to take out ANY loans. Oh well. </p>
<p>For grad school, which we are funding, D1 got into six top programs in her field. Many of these offered some scholarships. The one she chose, MIT, did not. But we allowed her to apply to these schools and pick the one that fit her best and she is at MIT. We just will be paying for it over time and not just out of current income. Ka-Ching.</p>
<p>Thank you racmom. I understand that if you haven’t lived in places like these people just can’t comprehend. The above situation is even worse right now for many people. It used to be someone bought a $1 Million house, put down $200k, took out a $800,000 loan and had that $200,000 in equity. Someday they could retire pull that equity out and move to a cheaper place plus they used to have great appreciation. </p>
<p>There are tons of people right now in Calif in this position EXCEPT their house is now worth $700,000 - they owe that $800,000 and in addition to having NO equity owe $100,000 more than the house is worth. That is why 1 in every 6 homes is in foreclosure.</p>
<p>While homes and cost of living are more in certain regions of the country, the salaries are also much higher. A home where I live may cost less…certainly not $1 million. But the income here, even for professionals, is less than in a more urban area. There are some expenses also in rural areas that those in populated areas do not have…such as long distance car drives to work and activities (lots of gas), snowplowing (that is a TRUCK with a plow on it every time it snows…just to do the driveway), trash removal, road grating (dirt roads), own septic systems that must be maintained, and things that are specific to this way of life. There is no public transportation either. Property tax is high…ours is at least $8,000. </p>
<p>Very few people where we live make anywhere near $150,000. So, even if the homes cost less, their incomes are also much less.</p>
<p>You could hardly find a home here for $150,000 as described above in another post. Ours costs and sells for way more than that.</p>
<p>“So, I would think that those who make more, can afford some loans if they opt to take them”</p>
<p>You don’t understand Soozie. It’s not about how much money you make. It’s about how much money it costs to live and what is left over.</p>
<p>HoosierMom, I do understand. Yes, it costs more to live. But the salary is also higher. My cost of living may be lower but so is the salary. We are taking out substantial loans. If I can do that, I think someone who makes more, even if it costs more to live (I may make less but it may cost less to live) should be able to take out some loans. Just as it is a hardship for me to take out loans, it may be for them too. Never said it was easy!</p>
<p>One parent posted that she has been able to pay for college so far without ANY loans. So, that is not something I can state. Thus someone earning more, even if their cost of living is more, seems to be able to fund college without loans. If they have to take SOME loans to pay for PART of it, it should be doable, even if a hardship. Believe me, it is hard for those of us who earn less too.</p>
<p>I know some folks will not like what I am going to say . . . . but I think that the decision to pay for a $200,000 college education is as much a matter of choice as ability. I agree with Soozie - FAFSA should (maybe not perfectly) even the playing ground for those families who can’t make that choice financially. I have many friends who are moderate income families where FAFSA helped a bit, but they still had to make the choice to take out loans and make other financial sacrifices so their kids could attend their chosen school. I could certainly find a lot of other uses for the money I have and will be spending on my kid’s education (including maybe retiring earlier), but I think it is worth it. Others don’t . . . not to say they care less about their kids than I do . . . but they don’t believe that, for example, a USC education is worth the money compared to a much more affordable education at the local in-state university. That said, I also think that the kids should have some “skin in the game”. It is easy to pick a high cost choice when they have no financial consequences of that choice. I don’t want money to be the driving force behind their decision, but I do want it to be considered. My D this year, for example, will have a choice between USC BA at $50,000 per year and a couple of other programs at less than half that. . . I would hope that if she ends up at USC it is because it is REALLY what she wants, can’t imagine being happy anywhere else, and that SHE thinks it is worth the extra money (because she might have to cough up a bit of it herself).</p>
<p>Soozie…the problem is you aren’t looking at the numbers. It’s not as easy as “make more, costs more” “makes less, costs less”. In my example, in my area people make l/3 less - houses here cost TEN times less. Making $150,000 and buying a $1 Million house is NOT the same budget as making $100,000 and buying a $150,000 house. </p>
<p>I used to go through this when I lived in Calif and had relatives come from Oregon. One was a truck driver. He made $15,000 yr. He saw in Calif that truck drivers made $45,000 yr. He thought he could come to Calif and get rich. Till I showed him houses for $550,000 that sold where in lived in Oregon for $80,000. Do the math - he would not have been living the same lifestyle in Calif - a much less lifestyle but the way you are thinking he would have been making 3 times his Oregon salary and not considering his mortgage would have been almost 7 times higher . </p>
<p>It’s not just the housing. Instead of car registration being $100 yr it’s $500 yr. Those high salaries count for everyone - your hairdresser, your butcher, your insurance broker, your plumber. Plumbers in Calif might make $80,000 yr or more…think they charge the same fee to unplug your sink that they do in your area?</p>
<p>IMHopeful…I agree that some of this is about choice of what to use funds for. And of course abililty to pay is also an issue. But I have read posts on CC (not the MT Forum) where those who do not qualify for any aid are not willing to take out any loans and simply can’t pay out of their current income. We do qualify for aid (we are middle class and not poor at all) and also can’t pay it all out of our current income. We have to take out loans and pay over time. We may not have a nice vacation. We may not have retirement or something else or other. Education for the kids is a major tippy top priority. For us, it is worth it to sacrifice for years to make this happen. Some parents do make their kids have some skin in the game and I support that. We have not chosen to do that as paying for education is what we want to give as our gift, as our parents gave to us. Our kids have earned some of their own spending money. And upon their graduation from school, they will have to support themselves. That is about to happen to my youngest daughter, who at 20, is graduating in May. She will be on her own financially at that point. She will not have college loans but we sure will.</p>
<p>Hoosiermom, houses here do not cost ten times less. You cannot get one for $150,000. It may not cost a million, no. The current value of my home is over $500,000. We make less where we live than those in urban areas doing similar professional work, however.</p>
<p>Also, in my view, someone earning $150,000 a year should not be buying a home that cost a million dollars.</p>
<p>Are you sure that car registration costs $500/year? My D just registered her car in Boston, an urban area and we paid for it all and it did not nearly cost that.</p>
<p>Soozie - I love the way you described the support of your kids in paying for their college as your gift to them. They are lucky kids to have such supportive and generous parents. As I mentioned earlier, we told our oldest that she would have to pay for half of her education, but that we would “lend” her the money until she graduated. So we took out the loans, scrimped, etc. to pay the costs. She made the choice, and just graduated with a both a BS and Masters - which she accomplished in four years and one semester. One of our graduation gifts to her was to “forgive” the loans she thought she was going to have to start paying off. You will never see a more grateful child! But, we have not had a vacation in five years. We have not bought a new car in six years. We virtually never go out to eat. We have become great “do it yourselfers” around the house. Etc. Etc. And now we get to start four more years of it. It is a sacrifice, but IMO worth it. Hope the cars hold out that long!!!</p>
<p>Your reward will come later when you will always be close to your daughter, husband? and grandchildren. She will take care of you both emotionally and possibly financially when your “64” and up…Believe me she will repay you for your sacrifices…I don’t mean financially, but that could happen too! Family brings happiness, especially in old age. I commend you and wish everyone had parents like you. I think Oprah should do a show about how parents sacrifice everything to send their kids to college…maybe she’ll give us all new cars:)</p>