Kids n’ College: The Bill
As I sit at a table with a few friends, they all begin talking about saving money for their kid’s college. “It’s SO expensive,” one of them says. “Oh, Tommy’s going to learn to play basket ball, so he can get a scholarship,” my buddy confidently remarks. “There’s so many loan programs out there. I’m not worried about it.” I hate to admit that one came from a friend… who somehow didn’t understand you pay loans back.
Sigh…
I’m a few years (decade) ahead of my friends when it comes to kids going to college. Actually, I’m there… and my friends are buying T-Ball sets.
But, when they’re ready to listen… and actually plan for college… I’ve got this all covered.
Three Basics to Paying for College
The cost of college is ridiculous!
There, I said it.
Coupled with the fact that a Bachelor’s degree is the new High School diploma, our kids are looking down the barrel of a gun when it comes to getting into the workforce. But, like I said in the last post, going to college is an important learning experience… and something we should figure a way into them doing.
As long as it doesn’t keep them tied to a loan with more comas than you can count, the rest of their life.
So, to get them out of college with even a chance of living a free life, we’re going to do three things:
- Save Up – you’ll want to actually read this one.
- Make Good Choices
- Do it!
Save up
Did you roll your eyes at that heading? Of course you did. No kidding, we need to save up for college.
… and I did it!
I saved a good percentage of my ridiculous pharmaceutical industry income to help – yeah… “help” – pay for my daughter’s college. Roughly ten years of sending a good chunk of dough off to a separate savings account.
Unfortunately, one particularly nasty custody battle later and… well, let’s just say I paid for a kid’s college, it was just my lawyer’s kid’s college.
I still say “Save Up!”
But, I’m not talking about saving up money.
I’m talking about credits.
Here’s where AP classes come into play. In the States, kids are offered Advanced Placement classes. At the end of these classes, you have the chance to take a test. Depending on the grade you get on the test – not the class itself – colleges will give you the credits equivalent to taking the entire class at the college.
The test costs $70. The college gives you credits. Believe me, $70 is way less than you’re going to pay to take that class at a University.
But, my son/daughter isn’t smart enough to take AP classes.
Yes, they are. Our education system was dumbed down to the lowest common denominator. Curriculum are now developed to focus on the very bottom percentile being able to pass. If your child isn’t getting A’s and B’s in regular classes, and they don’t have a learning disability, they aren’t trying. Period!
You also want to focus on the test at the end. My daughter rocked a solid 38% one semester and wound up with a 70% cumulative average in AP Chemistry. After taking the test, the college that accepted her is giving 3 credits for Chemistry… PLUS 4 credits for a lab science. That’s 7 college credits for a class High School says she barely passed. Who’s smart now?
But, the guidance counselor is recommending only taking one AP class.
They can recommend all they want, but really it’s your choice. They can suggest Honors classes instead, see note below, but it’s your choice. The teacher can even refuse recommending you… and it’s still you choice. If you think your child can do this, make them.
But, the school suggests taking honors classes instead.
This is, by far, the stupidest thing I’ve ever heard. Honors classes are the same work, but with no option for college credits at the end. More work + less pay off? What are we trying to teach kids?
But, my school doesn’t offer AP classes.
I can’t imagine this. When I was in High School, the school offered 4 different ones. The same school offered my daughter more than 10. But, if your school doesn’t offer them, check into dual-credit classes. These are actual college classes (often given by community colleges) that also count for the High School requirement. They’re a little more than $70, but still cheaper than full price at a college.
Wow! This sounds like free money. It can’t be that easy, right?
Well, the classes do take work. If your kid isn’t prepared to do the work, they’re certainly not going to be in college without a parent making sure the grades are on the up-and-up.
I do not in any way believe my daughter is an anomaly. But, here’s a statistic that will make her look like a freak:
My daughter walks into college with 31 credits. ← How much do you think that cut off the bill?
She did it with a 30hr / week job and played Lacrosse all through High School.
Yeah… that’s an entire year of college with a full book (15 credits).
Make Good Choices
OK, that’s a throwback to an older post, but it applies in spades here.
“The rich don’t focus on the best way to save money; they focus on the best way to spend it.”
My daughter was accepted to a college in the North East. It’s a beautiful school, with an amazing reputation AND it was her #1 college choice.
So, we sat down and looked at some numbers. They were BIG numbers.
Well, the one number that wasn’t big… was the average starting salary of her chosen career. Without boring you with all the math of it, we figured her to have about $800 / month to spend on… well, everything other than her loan payment.
…and she ain’t livin’ with me!
So, she took to the Internet. Using Collegboard.com, you can search for schools by price tag.
Is going to college based on the cost as sexy as those big name, blue blood, high-end schools?
Nope.
But, you know what? Two years after college, no one cares where you went. In fact, after the first job you get, employers only care about work history, job responsibilities, and professional referrals. And let’s face it; you get that first job from knowing someone.
So, in less than half the time you spend in college, the school name means nothing… at all. Now, that insane tuition bill seems much more meaningless.
Because it is.
Find a school you can afford. My daughter found three schools in the location she wanted, with the sports she wanted to play, and a tuition less than $30K – before grants.
Do it!
The very best way for parents to save money on college tuition is much more simple than cutting corners here and there.
Make your kids do it.
And by “do it,” I mean pay for their own college tuition.
Yep! There you have it. The BIG one. Let your kids take the loan. Let your kids pay the loan.
I know… I know… I sound like a monster.
But there are a couple reasons why the good parent doesn’t pay for college tuition.
- The reality is, we simply don’t appreciate things when they’re free. When we have to spend our own money on them, that’s when we pay attention and get the most of of things. Make your child responsible for the cost of their education and they’re more likely to thrive grade-wise – which also means keeping out of trouble because there’s actual consequences… like paying for that 8:00am Friday class again, since they “slept” through it the entire semester.
- Last month, we talked about college being an experience. Taking big, ridiculous loans holds very important lessons, too. And if you’re going to drown in debt, it’s sure better for it to be on education than on, say… a car. It’s a huge miss when you’re twenty-something, never had to pay a payment on anything, and walk into a car dealer.
It’s foundational for kids to learn what the effect of compounding interest is. What actually happens when you only pay the minimum amount due. What 59 more payments feels like emotionally.
Between you an me, I’ll help my kid out with a couple hundred bucks a few months so she can pay her tuition bill. On the other hand, if she learns the lessons of loans by getting a car or a house she can’t afford, I’m going to have a hard time justifying bailing that out.
BONUS: “Master” college
One last thing I’ll say about paying for college:
Make it count.
A Bachelor’s Degree is pretty much expected these days. So, shoot for a Master’s Degree.
We found this one out accidentally. It turns out some colleges offer accelerated programs that combing the Bachelor’s Degree requirements with Master’s Degree classes.
You can get your Master’s Degree in 5 years.
Pay it Forward
Was that what you were expecting for an ultimate guide to paying for college? Yeah, I doubted it. The rest of the “help paying for college” stuff I read was all regurgitated, fear-based content.
This is the stuff I learned going through all the motions and not letting my daughter settle for half.
Everything we read scares us into believing the cost of college is out of reach. The High Schools and counselors beat into our children how expensive college is going to be. So, when school X tells us our portion is $80K… per year… we just shrug as if it it’s just the way.
But, it doesn’t have to be. With a little research and work, you can get your kid into a situation they’ll be comfortable to come out of.
I’ve got a Honda in the parking lot that cost more than my daughter’s Master’s Degree is going to cost.
…and you don’t have to change the oil on a Degree,
