<p>What constitutes “live well” is different to different people. I am not saying that’s right. I do think individually, in private, they can feel whatever comes to their mind. For the public debate or policy, we need to agree what basic living expenses are given the GDP or earnings. I’d say it’s what it takes to maintain a modest home for a family, 2-3 bedrooms/1-2 bathrooms and public education, primary and college for kids. Anything beyond and above should be icing. We should focus on making those possible for a broader public before getting distracted by $200K-500K/yr group.</p>
<p>This argument is one of the reasons we have such income disparity. Our conversation usually ends up with the “middle” classes (plural because it’s the middle class plus the lower end of the rich who are rich by economic count, but who still struggle with their own donut hole of saving for college and retirement) fighting against the poorer classes’ perceived ripping off everyone else. </p>
<p>At the same time, the uber wealthy continue to write a tax code that tilts their economic field dramatically. </p>
<p>We end up outraged at some blue collar family using food stamps for potato chips, while we say little about our taxes subsidizimg billions in give backs to the wealthiest. We understand potato chips. Most of us don’t understand how venture capitalists use pass through tax rates to avoid paying taxes at the rate of a real person. </p>
<p>"I don’t resent poor people going to harvard for free. I resent that harvard and other schools have let their costs spiral out of control (3X the rate of household income).</p>
<p>Private manufacturing companies have to keep a lid on costs, or there’s hell to pay in the marketplace. When colleges don’t keep a lid on spending, there seems to be no negative consequences for them."</p>
<p>Sure there is. Your bright kid isn’t applying there, right? That’s their consequence.</p>
<p>It almost is like a damned if you do, damned if you don’t - if Harvard et al HADN’T been generous with the FA to poorer people, and just turned (back) into “playground for the upscale,” you wouldn’t resent it as much. But when they let some people on to the reservation for free / cheap, that’s where the resentment occurs. No good deed goes unpunished.</p>
<p>Timely article in The Economist:
Forget the 1%
It is the 0.01% who are really getting ahead in America
<a href=“Forget the 1%”>The Economist | World News, Economics, Politics, Business & Finance;
Lol, 200k income “rich” families are being lumped together w $371 million and $73 million net worth families.</p>
<p>With respect to whining about tuition–H and I never whined about paying college tuition; we also paid for private independent schools for a few years as well. We were grateful to be able to offer this to our kids (4 kids–dh’s 2 and our 2–all went to private colleges). Tuition wasn’t 60K when they went–more like 40K, but we were always full pay. We believe that education is important; it’s how DH and I moved from very poor backgrounds to where we are today–which a far cry from the wretched lower/working class neighborhood where I grew up and the gritty steel town where H is from. </p>
<p>Given that only 3 out of 10 adults in the US have college degrees, I can see why there are lots of families that don’t put saving for college into their financial picture or don’t figure it out until it’s too late. I don’t have a problem with folks who need it getting financial aid. People who have created elaborate ruses to hide income and get need-based financial aid for their kids are much more annoying to me. I’ll never forget a dinner with D1 and her roommates and all their parents at the end of freshman year–one Dad was bragging about a ruse he created so that his D was eligible for need-based financial aid. All the other parents were probably full pay (at least that’s what I’m assuming given what I know about their backgrounds/occupations). What an idiot! The guy is still an idiot (12 years later)–H and I went to his D’s wedding and we got stuck listening to him tell us about his “hot” new girlfriend (she had stepped away from the group) and try to wrangle an invitation to our vacation home, which is in a very nice area. I guess some people never change.</p>
<p>I can’t think of any other product or service where people pay what is deemed by the college, that they can afford. Of course some people will be unhappy they have to pay far higher costs than others. </p>
<p>I do not understand resentment towards families who get aid for their kids to attend private schools that meet 100% of need.
These schools ( with the exception of a few of the i us), still expect families to contribute 1/3 to 1/4 of before tax income to college costs. Their need is still made up from work study, grants and * loans*.
Living on 3/4 of $60,000 before taxes and after college costs is still significantly more difficult than lving on 2/3 of $200,000.</p>
<p>“Lol, 200k income “rich” families are being lumped together w $371 million and $73 million net worth families.”</p>
<p>I guess there’s 2 ways to look at it. Within the top 1%, there are two tiers - the bottom tier is the top 0.6%-1.0%, which are the certainly-make-a-good-living-but-still-have-to-work-for-a-living-folks. These are the dual income professionals, small business owners, CEOs of smaller companies, etc. They have some luxuries - maybe they have housekeeping help, a second home, go to Europe once a year - but not every luxury that money can buy, and affording a top college still requires <em>some</em> tradeoff in life.</p>
<p>Then you’ve got the top tier of the 0.5% and above, who are the REAL rich people - these are the people who routinely travel in private jets or go first class everywhere, multiple staffed homes, money is truly no object and a top college tuition is rounding error.</p>
<p>I guess as a member of that “bottom of the top tier,” I still look at it as – well, I’m doing better than 99% of Americans. I don’t look at it as - I’m not doing as well as the Waltons and Forbeses and Kennedys and so forth. </p>
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<p>If the $200,000 income household paying income taxes and $60,000 Harvard costs still has about $90,000 left over, then isn’t that still significantly higher than the pre-tax income of the $51,865 income household, even if the latter household is sending a kid to Harvard for $4,600 (that the student earns from work)?</p>
<p>I think college financial aid systems at the top schools are, while necessarily unfair, probably the best we can do if we don’t want to reserve certain schools for the very wealthiest students. In these threads, I always scratch my head at the assumption that every cent of the college cost will be coming out of that year’s salary. Sure, there are some people who were making much less until the very year that D or S was applying to college, but it isn’t all that unreasonable to expect that a dual professional family would have been able to save at least some money along the way. There’s also the possibility of taking on some non-oppressive debt, as people do as a matter of course when they buy their homes.</p>
<p>That being said, I think it is important to distinguish between well-off but not uber rich people expecting colleges to, essentially, subsidize their luxuries (the expensive vacations, the housekeeper) and people whose higher cost of living comes from things that, in an ideal word, would be considered basic expectations. Yes, the person making 90K after taxes + college costs is doing better than the person making 51K in NYC, but part of those costs are going to be eaten up with expenses that, if clearly not “essentials,” wouldn’t to me fall into the category of discretionary spending. Living in a safe neighborhood with good schools costs money. So does owning a car that one needs to commute to work - maybe two cars, in a two career family. The struggling family may not be able to afford (reasonable) extracurricular fees for their kids, or plane fare to visit the grandparents on Thanksgiving, or high-quality daycare, aftercare, etc, but I don’t consider even these things luxuries that someone making 200K should be reasonably expected to give up in order to save for a 60K a year college. </p>
<p>Good thing there are a ton of affordable public colleges, where someone who is eligible for admittance ( but not eligible for need only based aid) to an exclusive private school, is likely eligible for merit aid, ( or for aid at a less exclusive private)
:)</p>
<p>What I do not understand about financial aid is the real cut off point for income. Two hundred thousand dollars a year in Iowa is, from what I understand, a lot of money per year. New York city…not good. When Mr. Ellebud and I got married many years ago, we thought that 50,000 a year was amazing. Now…not. Again the criteria for loans is the same. If we lived somewhere else Mr. Ellebud could have retired 15 years ago.</p>
<p>@bevhills, more than 30 years ago, I was making $42k in Washington, D.C. It was good pay at the time, but not astounding. My employer moved me to Mississippi for an assignment, and I think I might have been the richest guy within a mile :). Then, my employer moved me to the NYC area, and had to throw in a per diem kicker to have me even consider it. </p>
<p>I don’t think we should adjust financial aid for students who want to go to private schools so people who live in the most expensive areas of the country get the aid. </p>
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<p>Where you live is a choice. Living in NYC (assuming that’s where you are) affords you career options that are not available in Iowa. Not only that, there are likely many more jobs in major metro areas that pay $200K a year than there are in Des Moines or Cedar Rapids.</p>
<p>@dstark, the other side of that is that typically the people in HCOL areas make more, so they get less aid. When I become dictator, taxes, capital gains, aid, and many other things will be indexed :)</p>
<p>Some profile schools do look at COL as part of their FA formula/equation.</p>
<p>In HI, which has one of the highest COLs in the US, average wages are LOWER than national averages, so it’s even tougher for many to make ends meet. Additionally, there are limited in-state post HS options, not the lovely range that NY offers.</p>
<p>HCOL areas provide good living conditions. If not, there will be no one living there as seen in the middle of desert or on the mountain top. To put it to extreme, asking COL be part of FA consideration is like asking to consider maintenance expenses of a fancy house.</p>
<p>If I lived in Hawaii and didn’t want to move to the mainland for more opportunities, I think I could make peace with not having a college education. Or I’d get an online degree. I mean, it’s HAWAII. </p>