SSS PFS Shock?

<p>I have admit, barring extraordinary medical expenses, it is hard to understand how an income of $200k could not support full pay since this should result in approximately $12,000 per month take home of which approximately $4-5,000 per month would pay for BS. That would leave $7-8K per month for living expenses assuming the the IRA and 401K were not being funded.</p>

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I have admit, barring extraordinary medical expenses, it is hard to understand how an income of $200k could not support full pay

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<p>I suspect that if one could go back in time and do a few things differently, it might well be enough. But, with time travel not a ready option, then one is left with the situation one is in today, which, for better of for worse, might include expenses that make a $50,000/year expenditure impossible.</p>

<p>Dodgersmom. Those at that income level have largely made lifestyle choices that make paying for BS prohibitive. Living in a big home, the mortgage, real estate taxes, upkeep, etc. Leasing cars. Running up the balance on credit cards. Why should a school subsidize these lifestyle choices?</p>

<p>One is not left with the situation. One can downsize.</p>

<p>Great post wcmom1958! Andover has been generous with us but we do home repairs (a new furnace after all), and we might want to spend 1000 dollars a year on vacations. I hope this doesn't mean it will come out of our financial aid award?</p>

<p>Some here are very judgmental. We have spent a fortune (think six figures) on therapies for our kid who is on the spectrum but doing great now. It takes money to pay that down. I drive an 9 year old VW with 208K miles on it. Our lifestyle choice is to help our child. Obviously home is a problem and we are thinking about getting out. We hope to pay about 50% of the cost for the boarding school. It is unfortunate that this thread turned in to a place where people can judge us without knowing the facts.</p>

<p>This conversation about "lifestyle choice" is interesting. Honestly, I think that many of us who ended up needing financial aid are in this situation because of choices: do we take the higher paying job or the one that gives us more time with our kids? do we buy the house in what was supposed to be the good school district? do we have four kids instead of two? etc., etc.</p>

<p>So which of those choices are we going to deem blameworthy (in other words, a disqualifier for financial aid) and which not? I'm glad I don't have to make that decision.</p>

<p>@pcotten If you have credit card debt in order to treat a child on the spectrum, you should explain that on the PFS and in letters to the financial aid committees of schools.</p>

<p>I'll repeat my judgemental position without apology or hesitation</p>

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I have admit, barring extraordinary medical expenses, it is hard to understand how an income of $200k could not support full pay

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<p>If a candidate's parents have had extraordinary medical expenses and now have debt to pay on these expenses, one would think the FA committee would take these facts into consideration. Otherwise, wouldn't they just scratch their collective heads wondering where the money went? (A hypothetical couple in the 50's maxing out a 401k equals $45,000 per year. The FA committees might expect parents to defer retirement savings??? It would interesting to know if that is the case)</p>

<p>@Weatherby: Exactly our position. We are in our mid-50s and the schools expected us to forego 401k contributions (we had been contributing the max plus 50+ catchup), so now we eek by on DH paycheck, and 100% of mine goes to BS. We will have a $200K "hole" in our retirement funds, but our son's education is more important at this point. We feel fortunate that two of the schools DS applied to called us before 3/10 to help us understand our financial situation and give us the opportunity to decide if we w/could accept admission without FA. I think it's possible the other schools saw what we didn't and choose otherwise.</p>

<p>Wow. What school would expect someone to forgo retirement contributions. Was that stated explicitly? Or implied by the parent contribution?</p>

<p>@Exie: as explained to us, money already in retirement / 529 accounts cannot be tapped, but ALL future income is "available" for tuition. Familes have to choose how to "spend" that. We thought that since we are older, there would be some understanding that retirement dollars would trump education dollars at least to some extent, but that seems not to be the case. All dollars not needed for obligations (mortgage, food, utilities, etc.) are considered disposable and expendable for "luxuries" like tuition, retirement, vacations, whatever. We were basically left with the decision on how to allocate that "leftover" with the school's fully understanding that the total amount of our "free" dollars = BS tuition. (Sorry for all the quotes, but the implications were made clear to us using that logic.) Silly us for thinking that being responsible all our married life with an eye to not being a burden to anyone in our elder years would be rewarded. I will say, though, that I think had we not had considerable amounts in the 401k and 529, there may have been some leniency. And I will also say that even though our local options are not palatable to us or DS, we agree that boarding school is a luxury no matter how necessary it may seem.</p>

<p>It also depends on what maxing out a 401k means.</p>

<p>If I have a small business (sole proprietor) with enough revenue to pay myself and wife a total of $200,000, we can defer around $100k/year into a solo 401K.</p>

<p>Highly compensated employees at some firms are offered nonqualified 401k plans that allow much more than the $22k limit (over 50 years old) per year.</p>

<p>We recently received my PFS statement and we were very shocked by our estimated family contribution. Our household income is 170,000> and they are expecting us to pay almost the entire tuition (39,000). Both of my parents work, but my dad makes less than 10,000 a year (My mom makes more than 160,000 a year). He has special circumstances that doesn't allow to obtain a "traditional" job (He is a freelance writer). We have a substantial amount of credit card debt and our mortgage is quite high, but I'm very much confused as to why we are being forced to pay the full tuition, when we are extremely close to living "pay check to pay check"!</p>

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We have a substantial amount of credit card debt

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<p>As previously noted, credit card debt is generally not considered an allowable expense, unless it was incurred for medical or other necessary expenses.</p>

<p>The schools' position is generally that they should not be expected to subsidize your extravagant lifestyle. Had your family opted to live more simply, in a smaller house with fewer credit card-funded luxuries, paying for boarding school would not be a burden. At some point, a choice was made, and that choice did not include setting aside sufficient income to pay for boarding school, even though the income was arguably available for that purpose.</p>

<p>I find it hard to sympathize with a family that is living "paycheck-to-paycheck" in a luxury home!</p>

<p>If you look at my posts above in this same thread, you'll see that I'm not quite so unsympathetic as I might sound. Nonetheless, using the phrase "paycheck-to-paycheck" to describe your current circumstances seems a bit of a stretch.</p>

<p>Tell me if I'm wrong, but I feel like you have a slightly preconceived notion about my family and our financial situation. I don't see how you can respond the way that you did, considering the information you were given. </p>

<p>"I find it hard to sympathize with a family that is living "paycheck-to-paycheck" in a luxury home!"</p>

<p>When did I ever state that we live in a luxury home? We definitely don't. I'm confused as to, how can you make a statement like that, when you have no idea how much my parent's paid for it and the type of neighborhood we live in.</p>

<p>"As previously noted, credit card debt is generally not considered an allowable expense, unless it was incurred for medical or other necessary expenses."</p>

<p>1) My mother had several necessary, medical-related surgeries (She broke her back and had to have spine surgery).
2) My father encountered a particular situation (that I refuse to speak about on this board) that forced us to pay more than $30,000.
3) I had several medical-related surgeries. </p>

<p>All of our credit card debt is due to these particular situations. </p>

<p>"Had your family opted to live more simply, in a smaller house with fewer credit card-funded luxuries, paying for boarding school would not be a burden."</p>

<p>That was a little condescending... Once again, you know very little about our situation and probably shouldn't make a statement like that. Also, how much my family spends on "credit card luxuries" is not my fault, therefore I shouldn't be penalized for it.</p>

<p>"Nonetheless, using the phrase "paycheck-to-paycheck" to describe your current circumstances seems a bit of a stretch."</p>

<p>As previously stated, I live in a single income household. My mother is the only person who really has a steady income. She is having to pay the bills all by herself. We are relying on a SINGLE INCOME. My father makes $5,000 a year. This is not because he doesn't want to work, but solely due to the fact that he can't. * We are very close to living pay-check to pay-check. * Also, do you really even know my current circumstances enough to say that? I don't think so. </p>

<p>This rant may have come off as a little defensive, but I would like you to re-read your post, and then tell me how "I should have responded". Your post was extremely condescending, insensitive, and judgmental.</p>

<p>Starkali,</p>

<p>We have lived with a child who has had extreme medical needs and surgeries over the past several year so I understand what you are going through. We have good insurance but it doesn't cover all the bills. It does eat up a significant part of our cash flow.</p>

<p>HOWEVER, and this is a big however, Dodger's mom is correct. $170,000 is significantly more income that most people make who are receiving FA. Remember - the FA doesn't come out of thin air, but from alumni and parent donations for the most part. Even at full pay (in your case $39,000) the real cost of your education is probably closer to $60-70K. </p>

<p>I hope that you were able to document the unusual expenses, but from the school's perspective a high mortgage is considered a lifestyle choice. It may not seem that way to you (especially if you live in an area with a high cost of living) but when weighed against someone who is struggling with a lower mortgage or even living in an apartment it's a balancing act on how to allocate limited funds.</p>

<p>This is a sensitive issue because there are many qualified students on this board who were declined spots last year due to FA, or waitlisted for FA (even partial).</p>

<p>As for defensive - yes because many of us on these boards pay the bills and even with the medical expenses - $170,000 is more than adequate to pay the bills and contribute towards tuition. In this household we are managing to pay for two kids - I suspect your family - if this is a priority - can scrape up the money for one. If not - loans are an option. Or downsizing.</p>

<p>If it were a choice between BS and my D not going - I'd sell the house at a loss in a down market and live in an apartment.</p>

<p>None of what a kid's parents do with their income is their kid's "fault," but it will certainly come into play.</p>

<p>I don't like all this blame being tossed about. </p>

<p>Consider, Starkali, that an income of 170,000 a year is close to 12,000 per month. Even when you subtract 40% of that for things like taxes, insurance, retirement, and other withholdings, it still leaves 8500 a month. (Since you mentioned medical issues, I'll assume your family has no health insurance to cover those things so that would actually leave a little more.) Housing is generally budgeted at 20% of income which would be 2400, plus escrow, might bump it up to 3000 or more. There's still 5500 per month for other expenses, which is why the "paycheck to paycheck" statement may have come across as a "stretch" but I'll take your word for it. Please understand that there many, many FA applicants whose families don't even start with the 5500 a month (just an educated guess on my part) that is left after your parents have made allowances for taxes and housing (most people's biggest expenses). You said you were confused about it and that's why I broke the numbers down the way I did. I'm really not trying to be condescending.</p>

<p>I know that kids don't always know their parents' full financial situation - mine don't. Perhaps your mother should write to the FA director to explain the discrepancy between the amount that she stated she would be able to pay and what the EFC is. Your family is certainly not the first to be baffled by the number the SSS spits back. I have heard of families making a successful case after March 10th for an adjustment to their award.</p>

<p>Good luck to you and to all the others in the FA boat. </p>

<p>There really should be someone who could help parents see the money that SSS seems to be able to find.</p>

<p>@Exie: I was definitely not expecting the schools to give me full tuition, or even half-tuition for that matter. However, I also wasn't expecting for them to force my family to pay almost the full tuition. My mother would even be able to pay $20,000 a year, but $40,000 is a definitely a stretch. We have already downsized to pay for my mother's medical bills (and the other situations that I've already spoke about)! I was just hoping to receive a little sympathy from the schools, given the fact that my I live a single income household and mother is having to pay for all of my medical expenses, her medical expenses, and my father's expenses. Also, my brother currently attends a private school, and are having to pay for his tuition. </p>

<p>Also, I spoke to my mother and she said that our first mortgage is actually not "that high". It's really the fact the we have a second mortgage (due to private circumstances). </p>

<p>My mother said that if we have to pay $30,000, we will. But $40,000 is almost impossible...</p>

<p>Neato: Thank you for your help. I feel like I have a much better grasp on the situation. If I happen to get accepted by any of the schools I've applied to, I will have my mother write a letter detailing the circumstances.</p>

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Also, how much my family spends on "credit card luxuries" is not my fault, therefore I shouldn't be penalized for it.

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<p>Sorry, but each of us is (for the most part) stuck with the family we're born into. Granted, it's not Student A's fault if his family wasted money on unnecessary luxuries . . . but, by the same token, it's also not Student X's fault that she was born in the Bronx to parents with a combined income that's less than the cost of tuition. So, who should get the financial aid grant?</p>

<p>starkali - I made the leap and said your family was living in a "luxury" home because of your comment about your high mortgage payment. I agree, there are plenty of communities in this country where a high mortgage payment doesn't buy very much. But, still, if it's a choice between staying in that neighborhood or paying for boarding school, at least your family has the choice.</p>

<p>For the family earning $30,000/year, with several children, and living in an apartment, there is no choice. They either get a financial aid grant, or boarding school won't happen.</p>

<p>I apologize if I was condescending, but the phrase "paycheck-to-paycheck" brings to mind a family that is earning far less than yours.</p>

<p>That having been said, medical expenses are generally viewed as a valid expense, and the income used to pay them should not be considered available to pay tuition. Make sure that the schools you are applying to are aware of those expenses.</p>

<p>Also, as I stated previously on this thread, we've all made decisions that put us in the financial situation we're in today . . . and it's not possible to turn back the clock and undo them. Maybe one family should have bought a smaller house way back when . . . but how did they know the good school district they were buying into was going to go down the toilet? Maybe another family's wage earner should have taken that high paying corporate job instead of a teaching position. And maybe if another family hadn't decided that one parent should stay home with that last child, then both parents could be out working today instead of just one. And sometimes the decisions that were made in the past mean that a child who wants to go to boarding school today isn't going to be able to . . . no matter how much they want it.</p>