As with anything, a lot of this is case by case. I hear a lot of finger wagging and holier than thou in terms of financial discipline and budgeting. Like Motley Fool and Bogleheads, CC tends to draw in those who are staunch researchers, budgeters, and savvy people. Not a typical cross-section of the college attending universe by any means.
Some random thoughts:
I went to college in the 90’s. My parents knew nothing of college, and I had to do all of the work myself. This was both excellent and terrible. Excellent in that I gained a ton of independence, learned many things (the hard way), and grew up faster than many of my peers. The downsides of course were that I made a lot of mistakes … I only applied to schools that were far below what I could have attained due to a lack of confidence and understanding of the situation. Undersold myself there. Made financial mistakes, and borrowed a lot.
Having said that, I left college in 1998 with over 40K in student loans. According to inflation calculators, this would be like 60-70K in debt today. I remember the loan payments weren’t easy, but they weren’t impossible either, and by 7-8 years the balances were low enough where I paid them off early. My career was in technology, and I was seeing raises each year. In the end, it was an absolutely fine investment (40K loan for a Comp Sci degree). My other choices were going to even worse schools. Hard to say how that would have went.
For our first of 3, we’re looking at a combination of things:
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Listing out all of the colleges accepted to, with merits, net costs, and rankings. We’re not going to equate a school ranked 40th in the nation to one ranked 110th, at the same net cost.
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Realizing that college isn’t ALL about the rankings, by any means, and some fair schools have excellent programs in given majors. This could allow for a better financial deal. Potential employers might rank your school higher based on a strong major/reputation.
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Splitting the cost between parents and student, skin in the game. A mixture of (a) 529 type savings, (b) some of the parents cash flow, (c) student loans, and (d) student paying for expenses and books through their own savings and/or work study.
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Major matters. If you want to major in art, philosophy, dance, social work, and so forth, I will guide DD to find schools that are cheaper, and better “fit” than prestige. If she is going into medicine, law, advanced technology, advanced politics, and so forth, where college pedigree is a MASSIVE factor in terms of job options post graduation, and they tend to more than pay for the debt, more money can justifiably be borrowed. It is what it is. For us, DD’s major choice is middle of the road (either Environmental Science or Agricultural science), and we’re going to lean harder on the science /tech side of that and less on the academic side. So financially we’ll aim for a happy medium in terms of loans/prestige.
I’d love to find a school that was a very good school and allowed for free attendance, but we’re not in that boat. So we will be working the phones (negotiating if we can) and mixing the forms of payment between the above. We’ll factor in major, try to educate the kid on how debt really works and feels (and pitfalls). My DD has been good about this in some ways, she has said “well which ones are the cheapest?”, but understandably, as a 17 year old, it’s virtually impossible for her to really know how a 45 year old parent who has been through good, bad and ugly financial times feels.
I have a max number in my head of loans (~60K over 4 years) which I will allow her to take on. Ideally we can do better than that. As mentioned up above, it will depend on the school.