University costs for your kids -- do you have a plan?
#91
BE Forum Addict
Joined: Apr 2011
Location: Ohio
Posts: 1,834
Re: University costs for your kids -- do you have a plan?
That $150k difference, compounded at a reasonable 7% over 40 years, is almost $2.5mill. I could make a very good argument that a child who knows that their retirement is fully funded from Day One of their first job could have a fantastic working life, making all sorts of adventurous, entrepreneurial 'stuff the consequences' choices, despite only having an own-brand college name on their resume. Or that using that $150k once they've got their degree to set up a business, travel, subsidise a decade or two of poorly-paying but immensely satisfying work might all be better choices than handing it over to Brand Name College; they should at least consider the alternatives.
There are perhaps a few careers/ industries where the 'right' college is terribly important and will make a clear difference to your working life. But otherwise I'd say the opportunity cost of what you could otherwise do with the money is too high.
#92
Lost in BE Cyberspace
Joined: Jan 2008
Posts: 41,518
Re: University costs for your kids -- do you have a plan?
Some of those private colleges are just quirky rather than prestigious.
#93
BE Forum Addict
Joined: Apr 2011
Location: Ohio
Posts: 1,834
Re: University costs for your kids -- do you have a plan?
So... maybe I'm missing something in my lack of personal college-aged kid experience. Those with older kids and more college experience: what reasons are there for choosing a considerably more expensive private school over a public one? So far I can think of:
- prestige and recognition of the private school's name
- student wants to study something incredibly specialist that's only offered at X
- student wants to study X under Lecturer Y because Y is extremely renowned
- student's passionate goal in life is to work at ABC Company, who openly state they do preferential recruiting from XYZ College
- student didn't get good enough grades to get a place at a public uni, so it paying for a place instead
I'm ignoring not logically justifiable lifestyle choices like just wanting to go to X because it looked really cool in the brochure/ their friend is going there/ they've always wanted to live by the sea, and so on.
Any others?
#94
Lost in BE Cyberspace
Joined: Jan 2008
Posts: 41,518
Re: University costs for your kids -- do you have a plan?
See, I hadn't even really thought of that - I was assuming that the only reason to pay fees of $40k+ is to be able to put Stanford or Harvard on your resume!
So... maybe I'm missing something in my lack of personal college-aged kid experience. Those with older kids and more college experience: what reasons are there for choosing a considerably more expensive private school over a public one? So far I can think of:
- prestige and recognition of the private school's name
- student wants to study something incredibly specialist that's only offered at X
- student wants to study X under Lecturer Y because Y is extremely renowned
- student's passionate goal in life is to work at ABC Company, who openly state they do preferential recruiting from XYZ College
- student didn't get good enough grades to get a place at a public uni, so it paying for a place instead
I'm ignoring not logically justifiable lifestyle choices like just wanting to go to X because it looked really cool in the brochure/ their friend is going there/ they've always wanted to live by the sea, and so on.
Any others?
So... maybe I'm missing something in my lack of personal college-aged kid experience. Those with older kids and more college experience: what reasons are there for choosing a considerably more expensive private school over a public one? So far I can think of:
- prestige and recognition of the private school's name
- student wants to study something incredibly specialist that's only offered at X
- student wants to study X under Lecturer Y because Y is extremely renowned
- student's passionate goal in life is to work at ABC Company, who openly state they do preferential recruiting from XYZ College
- student didn't get good enough grades to get a place at a public uni, so it paying for a place instead
I'm ignoring not logically justifiable lifestyle choices like just wanting to go to X because it looked really cool in the brochure/ their friend is going there/ they've always wanted to live by the sea, and so on.
Any others?
#95
Account Closed
Joined: Jan 2006
Posts: 0
Re: University costs for your kids -- do you have a plan?
It is hard nowadays to get into a prestigious state college like UCLA - you need a GPA of about 4.5 at least, and community service coming out of your ears. If you have money, you can buy your way in somewhere, with the benefit of a low teacher:student ratio too. Also, many of the private colleges promise to get you out in the four years, whereas UC students are finding it hard to do that due to not being able to get enough classes per year. Private college may offer a discount, say $20,000; that brings it much closer to a UC, which is about $16,000 at the moment (haven't checked that figure).
1. 2 years at community college
2. transfer to University as a junior.
3. Saved yourself a small fortune.
#96
BE Forum Addict
Joined: Apr 2011
Location: Ohio
Posts: 1,834
Re: University costs for your kids -- do you have a plan?
It is hard nowadays to get into a prestigious state college like UCLA - you need a GPA of about 4.5 at least, and community service coming out of your ears. If you have money, you can buy your way in somewhere, with the benefit of a low teacher:student ratio too. Also, many of the private colleges promise to get you out in the four years, whereas UC students are finding it hard to do that due to not being able to get enough classes per year. Private college may offer a discount, say $20,000; that brings it much closer to a UC, which is about $16,000 at the moment (haven't checked that figure).
And is the 'out in 4 years' thing a huge problem generally? I would've thought that anyone who could pull off a 4.5 GPA through high school has probably already got some college credits banked, plus would be the go-getting type that would take online classes, or do summer school if necessary rather than expecting to loll around for a 4-month holiday (assuming they haven't lined themselves up a fab internship). I've been assuming that the 5-year degree trend was due to indecisiveness/ idleness/ the need to work whilst studying.
#97
BE Forum Addict
Joined: Apr 2011
Location: Ohio
Posts: 1,834
Re: University costs for your kids -- do you have a plan?
That said, I think it's brilliant that the community college route exists, for people who simply want the bit of paper and not the life experience, or for whom 4-yr college is financially out of reach, or who aren't sure yet just how much more education they really need.
#98
Lost in BE Cyberspace
Joined: Jan 2006
Location: San Francisco
Posts: 12,851
Re: University costs for your kids -- do you have a plan?
Interesting, thanks! Is UCLA a special case? Our in-state unis (admittedly not as prestigious as UCLA) guarantee admission to anyone who ticks off the usual high school list of 4 English credits/ 4 Math/ 2 foreign language/ etc, and is placed in the top 25% of their graduating class. Is that the case in California generally, and other states?
#99
Re: University costs for your kids -- do you have a plan?
Interesting, thanks! Is UCLA a special case? Our in-state unis (admittedly not as prestigious as UCLA) guarantee admission to anyone who ticks off the usual high school list of 4 English credits/ 4 Math/ 2 foreign language/ etc, and is placed in the top 25% of their graduating class. Is that the case in California generally, and other states?
And is the 'out in 4 years' thing a huge problem generally? I would've thought that anyone who could pull off a 4.5 GPA through high school has probably already got some college credits banked, plus would be the go-getting type that would take online classes, or do summer school if necessary rather than expecting to loll around for a 4-month holiday (assuming they haven't lined themselves up a fab internship). I've been assuming that the 5-year degree trend was due to indecisiveness/ idleness/ the need to work whilst studying.
And is the 'out in 4 years' thing a huge problem generally? I would've thought that anyone who could pull off a 4.5 GPA through high school has probably already got some college credits banked, plus would be the go-getting type that would take online classes, or do summer school if necessary rather than expecting to loll around for a 4-month holiday (assuming they haven't lined themselves up a fab internship). I've been assuming that the 5-year degree trend was due to indecisiveness/ idleness/ the need to work whilst studying.
UC Freshmen Profiles
For the State System, pretty much everyone gets to be admitted to their college of choice unless their major is filled except Cal Poly which is very competitive in the engineering/science majors and SF state which is very competitive in medical majors.
All universities in the UC system charge the same tuition for undergraduate programs and the tuition for state system colleges are a little cheaper then the UC system.
Last edited by Michael; May 22nd 2014 at 6:09 pm.
#100
Re: University costs for your kids -- do you have a plan?
Bear in mind also that there is a lifetime maximum for 529 accounts, it seems to range between $235k and $400k.
#101
Forum Regular
Joined: Dec 2010
Posts: 168
Re: University costs for your kids -- do you have a plan?
We met with a financial advisor a few years back who did some projections for us. Our daughter was roughly 4 or 5 at the time and I seem to remember that the advisor estimated that by the time that she gets to college age, the estimated cost of (private) college for her would be around $1 million!!!
We then promptly went on to have twin boys so I'm having heart failure just thinking about how much we might need save in order to help them start out in the working world without a financial noose around their necks.
I graduated from the UK without any debt (was free to attend in the early '90s plus my parents paid small stipend for my living/beer). Hubby went to a US military academy so no fees and living stipend.
I set up 529 accounts for all three kids shortly after they were born and pay in monthly but they're on track to fall far short of $1m even with decent returns.
We then promptly went on to have twin boys so I'm having heart failure just thinking about how much we might need save in order to help them start out in the working world without a financial noose around their necks.
I graduated from the UK without any debt (was free to attend in the early '90s plus my parents paid small stipend for my living/beer). Hubby went to a US military academy so no fees and living stipend.
I set up 529 accounts for all three kids shortly after they were born and pay in monthly but they're on track to fall far short of $1m even with decent returns.
I think your advisor may be on a commission there! Seriously though, I mean if you're saying this was a few years back, that sounds massively inflated. I use the scholarshare calculator, and even if you select 18yrs from TODAY, with a private school estimate at $50,000 for 4yrs, it estimates the complete cost of the education in 18yrs time to be $590k. Considering your info is a few years old, $1m seems well over the mark. I assume perhaps you were calculating paying for some sort of graduate degree in addition to an undergraduate?
Also, as someone else mentioned, there are lifetime caps to 529's - the caps are on contributions, not earnings, but I believe they're all under $500k, so it'd be tough to get close to the $1m.
Remember also, if you don't use the cash for qualified education expenses, you have to pay fed & state taxes on it, and a 10% penalty. As you're doing this for multiple children - remember you can roll un-used funds from one childs account to the other....
#102
Lost in BE Cyberspace
Joined: Jan 2008
Posts: 41,518
Re: University costs for your kids -- do you have a plan?
Interesting, thanks! Is UCLA a special case? Our in-state unis (admittedly not as prestigious as UCLA) guarantee admission to anyone who ticks off the usual high school list of 4 English credits/ 4 Math/ 2 foreign language/ etc, and is placed in the top 25% of their graduating class. Is that the case in California generally, and other states?
And is the 'out in 4 years' thing a huge problem generally? I would've thought that anyone who could pull off a 4.5 GPA through high school has probably already got some college credits banked, plus would be the go-getting type that would take online classes, or do summer school if necessary rather than expecting to loll around for a 4-month holiday (assuming they haven't lined themselves up a fab internship). I've been assuming that the 5-year degree trend was due to indecisiveness/ idleness/ the need to work whilst studying.
And is the 'out in 4 years' thing a huge problem generally? I would've thought that anyone who could pull off a 4.5 GPA through high school has probably already got some college credits banked, plus would be the go-getting type that would take online classes, or do summer school if necessary rather than expecting to loll around for a 4-month holiday (assuming they haven't lined themselves up a fab internship). I've been assuming that the 5-year degree trend was due to indecisiveness/ idleness/ the need to work whilst studying.
#103
BE Forum Addict
Joined: Apr 2011
Location: Ohio
Posts: 1,834
Re: University costs for your kids -- do you have a plan?
Perhaps the route of community college to transferring junior has much more merit after all!
#104
Lost in BE Cyberspace
Joined: Jan 2008
Posts: 41,518
Re: University costs for your kids -- do you have a plan?
Do you mean the compulsory classes they all need to take, the English 101s and the like? I honestly didn't realise get your bum on a seat in one of those was an issue to be aware of.
Perhaps the route of community college to transferring junior has much more merit after all!
Perhaps the route of community college to transferring junior has much more merit after all!
#105
Re: University costs for your kids -- do you have a plan?
Do you mean the compulsory classes they all need to take, the English 101s and the like? I honestly didn't realise get your bum on a seat in one of those was an issue to be aware of.
Perhaps the route of community college to transferring junior has much more merit after all!
Perhaps the route of community college to transferring junior has much more merit after all!