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getting into a highly selective college, highly selective college, Kids going off to college

The College Dilemma

Parents, please read this if you have kids who are in or plan to go to college.  It could make the difference between them having a good life vs. a life of despair. 

My parents impressed on me the need for a higher education.  I remember my mother telling me, “You can lose a fortune, but no one can take away your degree.”  

She was singing to the choir; I knew I had limited talents, and I also knew I needed to utilize those skills if I were to have a successful life. I wasn’t athletic, I am too truthful to be a salesperson, and I’m an introvert.  The things that interested me were uncommon.  However, school came easily for me.  I seemed to understand things that others didn’t, and I had a knack for doing well on standardized tests.

Understanding how stuff worked and how seemingly unrelated things connected was as exciting to me as watching the Super Bowl was to someone else. I have always become wholly absorbed in learning the most trivial things and becoming an expert on a topic. 

I grew up in an era where science was king and America was at the forefront of science.  A time when it was thought that anyone could do anything.  When it came time to go to college, my attendance was not in question.  However, my resources were.  Those resources were limited not only financially but also informationally.  I had little understanding of where to go or how to pay for it.  My father made that decision easy.  “You are going to a community college,” he said.  And so it was written. The community college was nearly free in terms of tuition costs.  I had been working as a janitor during the summers and had enough money to buy a new 1972 Pinto for $2,700. College plus a car? Life was good.

To be honest, I enjoyed my 2 years at a community college.  I made good friends, had a lot of fun, and did well.  But what next? I still didn’t understand how the higher education system was wired. I knew that I would need to go to a state school to complete my degree, as tuition was lower.  I applied to exactly one school, and to be honest, I’m unclear why I chose that school.  I thought it was because my best friend, John, was going there.  John now tells me that I was the one to convince him to continue his education.  Perhaps it was just fate. 

The 1974 tuition for that school was roughly $500/year ($3,270 in today’s money). My parents agreed to cover that, but I was responsible for my personal expenses, from clothing to shampoo.  Naturally, I was expected to finish in 2 years, which I did.  Just like the community college, I did very well in school. What next?

I was a Biology/Chemistry student, and I knew graduate school was needed to go further.  I planned to become a university professor, and the graduate school I had my sights on would pay me to attend and even provide a stipend.  I worked hard in grad school and did well, but felt that I was being called in a different direction.  I left with a Master’s degree and didn’t pursue the PhD that I had initially intended.  I applied and got accepted into medical school, which was roughly $14,000 a year.  I actually debated going to that school, as other schools that I considered were in the $10,000/year range.  However, I believe that my career as a doctor would allow me to repay a reasonable student loan.  It turned out that my school made this burden even easier.

Due to circumstances, parental pressure, and self-luck, I made a lot of good financial decisions when it came to my educational choices.  I entered medical school debt-free.  I knew that I would have medical school loans, but taking them out was a reasonable decision.

During my decades of psychiatric practice, I have worked with every age range, from teens to seniors.  My career has allowed me to gain insight into what teens think, their emotional maturity, and their understanding of the real world. I’m here to report that their knowledge of the real world was not that different from mine at their age. In other words, not very good. Almost all had a feeble concept of finances and how student loans would impact them or their parents. 

Universities have steadily increased their tuition, far exceeding inflation and, in fact, surpassing many other costs, including those for housing and health. Part of this was due to the readily available and ever-expanding student loan machine, which eventually included parent PLUS loans. Student loans were originally a government program, but have long become privatized.  The government guarantees the loans, and they are unforgivable by bankruptcy. 

Colleges and universities saw this windfall, and tuition has reached astronomical proportions. Students are enticed by the promotion of the “college experience,” which often seems marketed more like a vacation than an education. Colleges promote their fancy dorms, deluxe gyms, and football teams more than their libraries.  

The US News and World Report became an artificial college rating benchmark, and schools saw ways to manipulate their rankings to allow even higher tuitions for those places deemed highly competitive.

The old dogma that a college degree was necessary to have a good life was not countered by the realities of astronomical tuition prices or the fact that many degrees didn’t justify their high cost in the real world.  Yes, if you were wealthy, a degree in Art History might be a fine option, but does it make sense to incur tremendous debt for a potentially low-paying job?  That’s assuming that you could find a job in your field of expertise.  No one seems to be talking about that reality. 

There have always been professions that fluctuate in demand, such as teaching, engineering, healthcare, computer science, and the like. However, many of these graduates are now facing difficulties in finding employment, yet they still have to repay their student loans, which begin six months after graduation. 

We have been charmed by colleges that showcase their beautiful campuses, fun parties, and happy student life.  The reality is that any college can provide a great experience, or not; it depends on the student.   I was treating a college student who was attending the same university that my daughter was going to. That student said that the place was terrible and unfriendly.  My daughter had the opposite experience and still sees friends from that school regularly.  She thought it was a wonderful place. It is what you do in college that makes it a good experience, not where it is.

You may think that I’m a super-frugal guy.  That isn’t the case.  However, I was fortunate to be raised in a family of limited means.  We delayed our gratification for things we wanted, my mother cooked most meals from scratch, and we repaired things or did without.  Life went on, and I knew that happiness wasn’t equated to my latest credit card purchase.  Having stuff is excellent as long as it doesn’t become a means to an end or a financial burden. 

I live in a nice town, and in a nice house. My kids attended good schools.  We go on vacations. I use a credit card.  However, I never have a balance on a credit card, and we now consider foods like steak as a special occasion food.  Trust me, there are many delicious foods that aren’t $15 a pound!  We are not deprived.  

However, it would have been easy to have changed my life situation.  If I ran up my credit cards, went on trips via loans, or got into BNPL in the past, my current life would be significantly different.  Society says we must buy, buy, buy, buy, and experience the exotic. Why is that?  It’s not to make you happy, it makes the rich richer and you poorer.  More importantly, it leads to tremendous stress.  That trinket you bought on Amazon, the one you lost interest in five minutes after receiving it, well, now you have to pay for it.

Our lack of financial knowledge starts early, and opportunities to increase our knowledge are often ignored. One of the greatest failures that can destroy a life is poor college financial decisions.  We want our kids to succeed and be happy.  We want them to have a good life, but our efforts can sometimes have the opposite effect. 

College is not an experience; it is a place to gain a higher education that can be applied to help create a better life and hopefully benefit society.  There are many other options that can achieve this.  Learning a trade, going to a community college to obtain a certificate, attending a technical school, being self-taught, and so much more.

Now, you may be thinking that I’m saying you shouldn’t go to college.  No, not at all.  I’m saying that other options may be suitable for some individuals.  Options that will cost less and produce a better outcome.  So many kids are forced into college only to waste money and never get a degree.  Why is that?

My kids were academically gifted, and I knew that they would have merit opportunities when it came to college choices.  I began to discuss higher education with them when they were in middle school.

My wife is a professional, but she took 12 years off to raise our kids.  That was a mutual decision that we will never regret.  However, this meant that I not only had to work harder, but it also meant that our overall income was much less than what it could have been.  When she did return to work, she initially did so part-time.  I continued to wholly support our family, and every penny that she made for several years went into a college fund for our kids.  Although substantial, it was small compared to the potential costs of sending three students to college. 

When my kids were approaching college, we did more research.  It was clear that they would be going beyond bachelor’s degrees, and we discovered that getting into a good post-graduate school depended more on their grades, test scores, and activities rather than the university that they attended.  

Because of their academic excellence, they got into top-tier undergraduate schools; however, any scholarships offered by these schools would only cover a portion of their overall tuition expenses. However, great but less nationally known schools wanted them and were willing to give them free rides, as my kids’ academic credentials would help the schools’ admission statistics (I know, this sounds crazy, but it’s true).

It’s tough for an 18-year-old who could attend a school with bragging rights to decide between that school and another.  They lack the mature financial understanding of a seasoned adult, and signing a loan for tuition doesn’t carry the same significance as if they had to withdraw that cash from their savings account.  Likewise, high schools want their students to attend the most prestigious colleges, as it enhances the school’s reputation, and colleges are more concerned about collecting tuition rather than loan repayments.

Loan companies make a substantial profit on student loans, some of which have loan terms similar to those of payday loans.  I read about one woman who paid $1000 a month for 10 years and actually owed more money than she borrowed after that period.  There are many stories of people who are in 100K debt, or much more, with degrees that only offer low-paying jobs. 

A line among student loan companies is “forbearance, forbearance, forbearance!”  If someone can’t afford to pay back their loan, reduce the installment.  Of course, the company makes more money on interest in the process.  

My kids graduated from college debt-free and all went on to higher levels of education.  However, now they had the tools to make informed decisions. One went on to a professional school which did have a sizeable tuition.  She was accepted at multiple schools and chose the one that was the best balance between excellence and affordability. She does owe a considerable amount, but she has already crafted a plan to pay off her debt as quickly as possible.  This plan was not made easy by the loan companies. She wanted to set up automatic payments, but they said they could only do this for the minimum amount, and not any other amount. This would mean she would accrue an astronomical amount of interest.  She found a way to subvert that plan, but it was not with the lender’s help.

Here are some tips:

-Please look at college like any other investment and discuss this frankly with your pre-college and college-age kids.

-Explore the benefits of a particular degree.  A student may want to study medieval languages, but is there a job available for them upon graduation?

-Run the loan numbers with your kids.  There are calculators on the internet that can do this for you at the touch of a button.

-Start talking to them early about college and money; add information as they can handle it.

-I never told our kids that they couldn’t go to a particular school.  What I did was to show them how much money we could contribute and then examine the financial burden that they would have to bear, depending on the school.  For instance, school “A” might cost them 70,000 in student loans even with that school’s scholarship, while school “B” would essentially be free.

-I let them know that I would help them in any rational way that I could, but I would not sign parent PLUS loans, as I was getting close to retirement, and it didn’t make any fiscal sense for me. 

In the end, they not only made good college choices, but also good financial choices.  But what if they weren’t academically gifted and couldn’t get merit scholarships?

-Does your child have a clear idea of what they want to do with a college degree?  If not, other alternatives, such as a gap year, may be a reasonable option.

-Consider a community college that can offer two years of general education classes at a fraction of the cost of a university. They can transfer to a 4-year college afterwards.

-Consider a local college to save on room and board costs.

-Consider the school that offers the best financial aid and quality of education combination rather than the highest-ranked school to which your child was accepted.

-Consider a trade school or certificate program.  Many do very well with these options.  I know of people in the trades who have a better lifestyle than mine. That is especially true for those who have some business skills and start their own companies. 

-Avoid parental narcissism.  “My kid has to go to the best school, as it gives me bragging rights!”

-Explore all of the many college scholarships offered.  Those small scholarships can add up to big money, and many go unclaimed.  

-Does your kid have special talents?  I have known several kids who received free rides, including room and board, due to their athletic abilities.  I have a friend with a very musically talented son who will certainly receive a scholarship. 

-Be practical about a degree.  My friend’s musically talented son could make it big, or not.  For him, it would be beneficial to also have a degree in music education as a backup.

I could provide you with more options and statistics on the topic, but the movie linked below does a much better job than I could.  Please watch it with your college-bound and college-attending students and discuss its content.  

I believe that a successfully raised child becomes a kind, empathic adult who can support themselves.  Expecting an 18-year-old to make a decision that will result in over $100,000 in debt is not reasonable.

We have a whole generation of recent college graduates who, because of student-loan debt, can’t get married, buy a house, or have kids.  Is that what we want for our children?

Please watch this video with you kids and discuss it afterwards. It may save you and your children a lot of future grief!

Peace

Mike

Me graduating from medical school. So young and with hair!
achieving life goals, Celebrity College Admission Scandal, highly selective college

The Great College Admissions Scandal And Why You Should Care.

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My 50th birthday coincided with another significant event, a need to buy a car.  I had always purchased conservative vehicles, but I had a secret desire for something grander.  I wanted a doctor’s car, and in my mind, that meant a Mercedes.

I accepted the fact that this was strictly an emotional purchase, and that it symbolized that I had arrived as a professional.  The Mercedes that I purchased was dark metallic green with a tan leather interior. I thought it was beautiful, in an understated German way.

I felt like every driver was watching me as I drove it off the lot, and my chest swelled with pride to own such a luxurious vehicle.  That euphoria faded with the realization that my Mercedes was intrinsically no different than the Ford that I previously owned.

After my car’s warranty expired, I was gobstruck with the enormous expense of maintaining my Mercedes. When I would bring the car in for a simple repair the cost would escalate as the dealership’s customer service writer would always find something else that needed repair.  I would bring the car in for an oil change and leave paying a $1000 bill.

After a few years, I had enough of my luxury experience and traded in my low mileage doctor’s car for a simple Honda.  The Honda delivered, while the Mercedes only promised. The experience was an excellent life-lesson.

The news has been abuzz with a new celebrity scandal, this one involving parents cheating the system so that their underperforming kids can get into selective colleges.  The scandal consists of a man named William Singer, and his sham non-profit organization. Individuals of power and means paid Mr. Singer enormous amounts of money for him to work his magic with their unscholarly offspring.  His deception went above and beyond ghostwriting personal essays. He created false identities, photoshopped prospective student heads on stock photos of athletes, had test proctors change answers, and bribed various university officials with cold hard cash.  He claims that he has helped over 700 students cheat their way into college.

It would be naive to think that he is an island unto himself. Common sense dictates that this case is just the tip of a much more massive iceberg, its specifics made more interesting because celebrities, such as Felicity Huffman, and Lori Loughlin are involved.

I have a daughter who is a freshman at a large Midwestern university.  When my wife asked her what she thought about the above scandal she seemed insouciant noting, “How is that any different from donating money for a building which then gets your kid accepted into that school.”  She was, of course, correct. People with clout have always had a higher chance of getting their children accepted into a selective college, as opposed to those who lack influence. In fact, a legacy applicant has a three-fold better chance of getting admitted into a selective college than an applicant who doesn’t have such lineage.  

I recently read an NYT’s article on the heels of the above story.  It involved 4 excellent students and their efforts to get into highly selective colleges.  One of the case studies currently is a student at the high school where my kids have attended.  This girl achieved a near perfect SAT score and had a GPA of 4.8 out of a possible 4.0. She was active in clubs and organizations.  She was involved in leadership positions. Yet, she was rejected by her first choice, Harvard. I can’t imagine that there was anything else that she could have done to have been considered. When you look at her impressive credentials and compare them to lesser students who were accepted, it makes you wonder about the real value of such an education.  

There are over 5300 colleges and universities in our country, yet many students feel that they have to attend only a selective few. In a world where college tuition and fees are extraordinarily expensive, these colleges go above and beyond and hit new heights as far as costs are concerned.

Does attending these schools significantly impact the future of a college student?  This is a complicated question, but the bottom line is generally, “no.”

At this point, you are probably recalling the frequently quoted study that noted that students who attended the most selective colleges have been shown to have significantly more earning potential than those who attended the least selective colleges.  This statistic may be accurate, but the cause and effect association is not as direct as you may think. Other important factors need to be added in. For instance, the caliber of a student at a highly selective college is likely higher, as is their socioeconomic position, and their family connections.  In fact, if you take a look at the wage gap between students from highly selective colleges vs. less selective colleges the earning difference disappears with students with similar SAT scores.

Other statistics worth noting is that the majority of CEOs from the top 100 Fortune 500 companies did not attend an Ivy League school. When Wall Street recruiters were asked where they found the best candidates, it wasn’t from Ivy League schools; instead, they listed the University of Illinois, Arizona State, and Purdue.

Most universities are bursting with highly academic faculty; there is no shortage of PhDs in the college world.  An undergraduate experience includes a wide diversity of classes, usually presented at an introductory level. Is there a significant difference between English 101 at a local college vs. a highly selective school?

We are currently dealing with an artificially created frenzy where admittance to an ultra-expensive highly selective school becomes the ultimate prize for both the student and their proud family.  However, I have to think that an education at such an institution may feel similarly to my Mercedes experience. The initial euphoria can quickly give way to frustration once you realize that you are paying 4-5 times the cost for something that is not 4-5 times better.  

As parents, we need to help our kids see the reality of their life decisions.  College shouldn’t be an experience, like a holiday vacation, it should be an education for the future.  Part of being an adult is making wise decisions, including the value and benefit of a school.

For the ultra-rich spending hundreds of thousands of dollars is insignificant, but such a debt can be life-altering for a typical 21 year old who has graduated only to find that this overwhelming burden is preventing them from realizing their personal American Dream. Adult life does not start in college, it happens afterward.  That is the time when our offspring need to be free to explore options.

It is my hope that the above scandal helps potential students and parents alike examine their higher education goals, and to explore all rational options. There is a big difference between true value and hype.

dangers of student loans, getting into a highly selective college, highly selective college, Parent Plus loans, student loan crisis, Uncategorized

The Highly Selective College Myth And The Terrible Student Loan Crisis

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For my 50th birthday, I gifted myself with a real doctor’s car, a Mercedes. When I pulled out of the dealer’s lot, I felt like I was the king of the world. After a month of driving my new car, I realized that it was just another box on wheels.
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The house lights dimmed and my eyes focused on the panel of experts sitting at a long table. The host introduced each member, starting with the representative from our local community college, and ending with a counselor from the University of Chicago. She represented all of the “highly selective colleges.” It appeared that the panel members were positioned in a classic good, better, and best order.

You may be wondering what a highly selective college is. A selective college is one that accepts less than half of its applicants, and a highly selective college is a college that accepts less than one-third of its applicants. I attempted to determine who coined the selective and highly selective terms, but I was unsuccessful. However, these names have the ring of a good advertising campaign slogan.

A school can become a selective or highly selective simply by refusing more applicants. The Washington Post in an October 2017 article listed some of the ways that colleges become selective and highly selective. One way is to buy the list of names of individuals who have taken the ACT and SAT college admission tests, and to then market your school directly to those students, even when your college has no intention of ever accepting them. This not only reduces the percentage of individuals accepted, but it also provides revenues to the college via application fees. A second technique is to use multiple applications cycles, like early decision.

As an example, Vanderbilt University filled 54% of its freshman positions via early decision rounds. In other words, only 46% of first-year slots were available for the majority of the applicants, thereby reducing the percentage of students accepted. It is unlikely that applicants accepted by early decision will be offered merit scholarships, as they have agreed to a binding commitment to attend. The college has them and doesn’t have to worry about the student getting a better offer elsewhere. This makes it more likely that a higher percentage of these students will come from affluent families who can afford to pay full tuition.

You may hear statistics that promote the benefits of attending a highly selective school. In a 2010 article, the New York Times cited a study from the RAND corporation that showed strong evidence that graduates from highly selective colleges did very well. The study looked at participants who had graduated ten years prior and found that individuals who attended highly selective colleges made 40% more income than individuals who graduated from the least selective colleges. On face value, it would seem that highly selective colleges possess some “secret sauce” for success. However, isolated statistics rarely tell the full story. Students from highly selective colleges are often very motivated and enter college as excellent scholars. In addition, they can be more affluent and thereby have greater social and business connections. Graduates for the least selective colleges can be at the opposite end of the success spectrum.

A 2017 Atlantic article revealed that when students with similar SAT scores were compared there wasn’t a significant difference in overall earning between highly selective and less selective colleges. Factors that have a more direct impact on someone’s earning potential include the type of degree (engineering vs. social work) and the individual’s drive, talent, social skills, and motivation.

You may also have heard that 30 of the top 100 CEOs from fortune 500 companies come from Ivy League schools. This sounds impressive, but note that 70 of the top 100 CEOs did not. And let’s not even talk about university dropouts like Microsoft founder Bill Gates, and Facebook founder Mark Zuckerberg.

Do graduates from highly selective colleges have higher job satisfaction? A Journal of Labor Research article states the opposite. Highly selective college graduates were less satisfied with their job than individuals from less selective schools.

The subgroups that did seem to show a positive financial benefit from attending a highly selective college included individuals whose parents did not have a college degree, as well as blacks and Hispanics. The article speculated that these students benefited from the networking and connections that they made at their universities.

Highly selective colleges are typically more costly than other schools. Harvard’s 2015 average annual cost for a student was $64,400.00, compared to $24.673.00 at the University of Wisconsin, Madison. Both schools offer excellent educations, but a year at Harvard is almost three times as expensive. Many universities offer some financial need aid, but highly selective colleges typically do not provide academic merit scholarships.

The pressure to get into a highly selective school can be enormous and can be both internally and externally generated. I have known students who felt that they would be a failure if they didn’t get into the highly selective school of their choice. Parents sometimes use their child’s college acceptance as a personal point of pride, as well as a license to brag. High schools loudly celebrate when one of their students is accepted into a highly selective school. Parents talk about giving their kids the “college experience” as if going to an institution of higher learning was akin to a ride at Disney World. All of these factors contribute to the myth that a degree from such an institution is magical, which it is not. In my work life, i have talked to parents plagued with guilt because they didn’t have the resources to send their child to the school of his/her choice. It should be noted that the student’s choice often had little to do with academic reasons and more to do with setting, and social life.

A 2018 Forbes article headlined that the price of college is increasing almost eight times faster than wages. A 2012 report from the Huffington Post cited that the cost of a college degree has increased 1120% over the last thirty years. These numbers apply to all colleges, but highly selective institutions (as stated above) are the tuition leaders. There are many factors for these outrageous increases. However, a significant factor has been the increase in “easy money.” Students can take out almost unlimited secured and unsecured student loans, as can their parents (Parent Plus loans). This surplus of cash has allowed colleges and universities to raise their tuition and fees to unprecedented levels.

College loans have become big business, and lending benefits both schools and loan institutions. Sallie Mae was under the control of the government, but in the 1990s a private lender bought the Sallie Mae name for five million dollars. The new private Sallie Mae has been reported for unethical practices, but many parents associate the name with secured government loans and assume that their child will be treated reasonably and fairly.

Student loan debt is currently at a staggering 1.5 TRILLION dollars and rising. There are countless stories of student and parents who signed for loans, later noting that they had no idea what they were doing at the time. Students get not only subsidized loans but also unsubsidized ones. If the borrower can’t pay back the loan due to hardship, it may temporarily go into forbearance. This may sound like a good idea to the student, but it isn’t.

If a loan is in forbearance, it continues to accrue interest. That interest can then be added to the principal of the of the loan in a process called capitalization. There are cases where a loan has almost doubled from its original value. Imagine that you borrowed $60,000.00 and later discovered that you now owe $100,000.00. For lenders, the more money you are in debt, the more money they make. The government guarantees many student loans, so if you don’t pay them back, they will get that money from the US treasury. There is little incentive for companies to work with borrowers.

Forbes in a 2018 article noted that student loans are now the 2nd highest consumer debt, behind mortgages. The average debt per student is a staggering $37,172.00, but this only tells part of the story. Over two million students owe over $100,000.00, four hundred and fifteen thousand students owe over $200,000.00, and there are currently one hundred students who owe over $1,000.00000 in student loans.

It is easy to blame students for the loan crisis, after all, they signed on the bottom line. However, the massive scope of the problem suggests that the blame also needs to be placed on lenders and colleges, as they did not inform students and their parents adequately. Many students approach college decisions emotionally. They sign for loans with the perceived idea that they will make good money after graduation, and that they will have no problem paying the loan back. Yes, students need to be responsible, but so does both the lender and the college.

Many college students study majors that do not provide a path to a high paying job. Also, many students who start college never obtain a degree. Both student and Parent Plus loans cannot be eliminated by bankruptcy. This law was enacted in the 1970s with the industry citing a 20% student loan default rate at that time. However, only a tiny fraction of that default rate was due to students filing bankruptcy. A student loan debt is yours for life and it will impact everything from your credit score to your ability to get hired.

When a person stops paying a loan, it continues to grow with little chance of forgiveness. Search, “Dave Ramsey, student loans” on YouTube, and you will find the story of a teacher who owes $160,000.00, and dentist who owes over $1,000.000.00 in student loans. Couples that marry enter that union with their combined student loan debt, sometimes making it impossible for them to live independently.

We have a generation of graduates who are often underemployed and hopelessly in debt. They can’t buy a new car or purchase a home. They wonder if they can ever afford to have children. These are the young adults who did the right thing, they delayed their lives and got an education. Now they feel betrayed. Their financial insecurity impacts all of us and has a negative impact on the US economy.

Colleges are run as big businesses and employ those same marketing techniques as fortune 500 companies. It is essential to approach higher education as a consumer, rather than a student. It is crucial to squarely examine the cost to benefit ratio when making any college decision.

It is ridiculous to think that everyone should go to college; there are other paths to being successful in life. I know of many individuals who are skilled tradesmen. These people do very well financially. As bonuses, their earnings started after high school, and they have zero school loan debt.

When a college degree was less expensive, it made sense for some individuals to obtain less marketable degrees. Students were encouraged to pursue their passion and to broaden their horizons. However, college is becoming a trade school; a place where you gain a marketable skill. It makes no sense to saddle yourself with $100K of student loan debt for a profession where you will only be making $30K a year. Passion for an area of study can run cold when you can’t afford to put food on the table.

College is supposed to prepare you for life. However, massive debt cripples you. To circumvent the debt problem students and their parents need to be creative and think outside the box. Applying to a college because you liked the look of the campus, its sports complex, or its location makes little sense in today’s market.

  • Consider a community college for your first two years. English 101 and Math 101 are pretty much the same wherever you go. You may get more personalized attention at your local school.
  • Explore any scholarship options. Merit scholarships can be given by outstanding schools who want to attract the best and brightest to their institution. If you are a top student, it is nice to be the big fish in a little pond.
  • Strongly consider the cost-benefit ratio of your chosen major.
    If you choose a low paying major, think carefully why you are doing this, and have a clear idea on how you plan to make a living that includes paying off your student loan debt.
  • For-profit online schools often have high tuition and a low graduation rate.
  • Your community college may offer the same certificate program that a private school provides at significant savings.
  • Realize that many interesting sounding careers have few job openings. You may want to become a music recording engineer, but good luck in finding a job in that field. Check job availability before you start a degree or certificate program.
  • Choose the best school THAT YOU CAN AFFORD, rather than the best school that accepts you.
  • Consider attending a commuter school to save thousands on room and board fees.
  • It is likely that you will need to take out a loan. Stick with government subsidized loans, and set a limit to the total amount that you will borrow throughout your degree. Don’t use loans for everyday expenses.
  • Use online calculators to understand what your monthly payments will be.
  • Understand loan terms, such as forbearance, un-subsidized/subsidized loans, and capitalization, and know how these terms impact your loan.
  • Schools and loan companies are looking out for their interest, not yours. Accept this fact and approach any offers accordingly.
  • Consider a certificate program instead of a baccalaureate degree, if appropriate. Community colleges offer many such programs.
  • Consider a trade. A practical skill combined with ambition and a little business sense can make for an excellent life.

I currently have two daughters in college. The oldest of the two attended IMSA, which is considered the top math and science high school in Illinois. Also, she was a National Merit Scholar. This latter fact granted her free college tuition at some colleges and universities. When we met with her guidance counselor, we were surprised when the counselor informed us that the majority of the school’s National Merit winners did not take advantage of free tuition, opting to set their sites on selective universities. I am thankful that my daughter bucked this trend and she is now completing her degree in Chemistry and Russian at an excellent state school.

My other college student was accepted at Vanderbilt and Washington University, both selective schools. She is also an accomplished student, but neither school offered her any merit-based money. However, many other colleges and universities did offer her money based on her academic performance. She is currently attending a wonderful Midwest university, majoring in Public Health. I am so grateful that they will not have the burden of tremendous debt that many students face. My graduating daughter is strongly considering applying to the Peace Corps. She would not have this option if she were facing the repayment of massive student loan debt.

Dear readers, it is essential for all of us to explore our dreams. However, the wise person makes this discovery sensibly and thoughtfully. Happy school hunting, and please share this post as I believe that the information it contains can help many parents and students who are facing the challenge of college.