College costs, anyone else spit coffee on their monitor?

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College costs, anyone else spit coffee on their monitor?

Postby DoWahDaddy » Thu May 16, 2013 12:35 pm

I must have lost track somewhere along the years. I didn't realize it's been 15 years since college, and as such, the costs were likely to be double now. I went to a good private school, certainly not ivy league, but solid. And yep, it's doubled in tuition+room and board. 200k all in now. And I ended up bringing double the people into this world that I am. So 400k all in. In today's dollars. So... 800k all in in 15 years, when the kiddies will be attending. Ugh. Since it's impossible to determine where any child would go, if anywhere at all, and how much would be paid via scholarship, one would have to basically plan a course with very little input. Crazy with numbers that could be ridiculously diverse.

I've been putting away the max in my 401k, and into non-deductible IRAs for me and the Mrs. Beyond that, we've been splitting between 529s for both kids, and taxable investments.

I'm interested in what others do, split somehow between 529s and taxable investments as well, or allocate solely to one of the two, and what the reasoning is.
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Re: College costs, anyone else spit coffee on their monitor?

Postby Grt2bOutdoors » Thu May 16, 2013 1:04 pm

DoWahDaddy wrote:I've been putting away the max in my 401k, and into non-deductible IRAs for me and the Mrs. Beyond that, we've been splitting between 529s for both kids, and taxable investments.

I'm interested in what others do, split somehow between 529s and taxable investments as well, or allocate solely to one of the two, and what the reasoning is.


Retirement first, 529 plan second (until I reach what I deem to be a sufficient amount of savings) up to allowable amt of $14K per year, taxable savings. Retirement - is tax deferred and off limits right now for FAFSA, 529 plan is tax free on account growth from gains and div/interest, though I don't believe losses are deductible at all. Taxable savings - use of tax efficient index funds and muni funds.

BTW, your kids don't have to attand your alma-mater, a reasonable state school would be equally acceptable. I don't believe higher ed inflation will hold - as I stated earlier, given the increase in fund raising calls to my abode in a massive dialing for dollars campaign to hold tuition down, one or two things will occur: 1) tuition goes up, college rolls decline, heat to control costs go way up in effort to keep the doors open or 2)they keep tuition flat or lower it otherwise the competition will eat them for breakfast in a few years. Either way, people are becoming very leery of taking on debt to pay for an education that neither gurantees them or even gives them a chance at employment. If the administrators haven't been reading this board, they should start - what we're saying is America has caught on to your little game.
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Re: College costs, anyone else spit coffee on their monitor?

Postby HomerJ » Thu May 16, 2013 1:12 pm

I just put two kids through college...

University of Kansas... about $15k a year including room and board... $60k total for each of their degrees... And that's with sorority fees... Could be done for less.

There should be a simple college admission test.

"Are you willing to pay $200k for your undergraduate college degree?"

If they answer "Yes", then they are too stupid to go to college....

(I kid, I kid!)

But seriously, if you don't get scholarships or financial aid, then don't go to those expensive private schools. There are plenty of very good public state schools that offer reasonable in-state tuitions.
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Re: College costs, anyone else spit coffee on their monitor?

Postby hand » Thu May 16, 2013 1:14 pm

With the luxury of the reasonable expectation of a decent income for years to come, (and some complexities related to a step-child) I am maxing 401(k)s and Roth IRAs in addition to small employer funded pension plans, and paying down debt to a comfortable level. A 529 exists only to capture gifts from relatives.

Bottom line, I plan to have very well funded retirement accounts, limited debt, and minimal college savings when stepchild enters college with contingency plan to reduce / stop retirement savings if post retirement savings cash flow won't cover annual costs.

Personally, I believe/hope we're near the peak of college tuition costs on a real basis as there is already a generation of students who will have difficulty achieving a meaningful financial return on their educational investments. It is not possible for tuition increases to continue to outpace wage growth.

My sincere hope is that colleges find a way or are forced to unbundle their core purpose - education & credentialing - from the marketing / ratings driven need to provide a luxury product (climbing walls, gourmet food, fancy dorms) and the associated costs. Federal and state aid should only be applicable to costs directly related to education, credentialing and basic subsistance.
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Re: College costs, anyone else spit coffee on their monitor?

Postby Ted Valentine » Thu May 16, 2013 1:21 pm

Here's a guy that did it debt free to Duke by living in his van.

http://ssl.marketplace.org/topics/life/big-book/21st-century-thoreau-living-debt-free
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Re: College costs, anyone else spit coffee on their monitor?

Postby 22twain » Thu May 16, 2013 1:23 pm

hand wrote:marketing / ratings driven need to provide a luxury product (climbing walls, gourmet food, fancy dorms) and the associated costs.


Don't forget the athletic programs and facilities.
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Re: College costs, anyone else spit coffee on their monitor?

Postby ourbrooks » Thu May 16, 2013 1:36 pm

Alas, the real cause of the rise in college tuition is simple to understand; between the 1970's and today, the number of students attending college has increased by a factor of 3! That means 3 times as many classrooms, 3 times as many professors, 5 times as many parking spaces, etc. If you factor in inflation, about 30 times as much money is need for college education today as in the 1970s.

Not surprisingly, state legislatures have been unwilling to increase their spending by a factor of 30 and private endowments haven't kept up either. The only place left to get the money is by raising tuition.

Is the rate of cost increase likely to continue? Probably not. Both the number of students in the college age bracket and the college attendence rate appear to be stabilizing. On the other hand, state governments are trying to reduce costs and higher education is a big expense.

There's also considerable discussion about changing the way in which education is delivered. A strong argument can be made that an online course delivers at least as much book knowledge as sitting in a 1,000 student lecture hall, especially if the online course were combined with teleferences or occasional face to face meetings. The Open University in the U.K. has operated on just this model for several decades with a fair degree of success. (Joke: What does an Oxford graduate say when meeting an Open University graduate? "Good morning, boss")

As other posters have noted, a good question to ask is how does college spending affect overall life success? Would your children really do that much better in life if they went to a more expensive private college instead of to a less expensive state subsidized school?
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Re: College costs, anyone else spit coffee on their monitor?

Postby Sam I Am » Thu May 16, 2013 1:43 pm

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Re: College costs, anyone else spit coffee on their monitor?

Postby prudent » Thu May 16, 2013 1:44 pm

Two main reasons for the skyrocketing costs - students who believe more expensive = better, and government guaranteed school loans. I don't think the huge increase in college administration staff is a cause - it's an effect. When your customers are willing to assume any amount of debt to meet your asking price, and the lenders have no risk, it only seems logical that we'd get the outcome we have today.

Faculty now make up less than half of the number of employees in US colleges. This is from a two-year-old article in the Washington Monthly, pointing out that many very highly paid admins have very little to do:
For example, at a recent “president’s staff meeting” at an Ohio community college, eleven of the eighteen agenda items discussed by administrators involved plans for future meetings or discussions of other recently held meetings. At a gathering of the “Process Management Steering Committee” of a Midwestern community college, virtually the entire meeting was devoted to planning subsequent meetings by process management teams, including the “search committee training team,” the “faculty advising and mentoring team,” and the “culture team,” which was said to be meeting with “renewed energy.” The culture team was apparently also close to making a recommendation on the composition of a “Culture Committee.” Since culture is a notoriously abstruse issue, this committee may need to meet for years, if not decades, to unravel its complexities.


The action for students and parents of students is to not think that a more costly college means a better education. When schools find that their recent tuition hike actually meant less income due to a drop in enrollment, they'll find ways to cut costs.
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Re: College costs, anyone else spit coffee on their monitor?

Postby MathWizard » Thu May 16, 2013 2:16 pm

I have kept up with college costs, and was more worried when my kids were young than
when they became college age. Keep putting an increasing amount of money away
(I maxed the ROTH, and just put small amounts in 529s.) By college time I could just
stop putting money away and pay out of pocket.


State flagship Universities are just over $20K total cost per year for in-state students.
Most programs require 5 years to graduate, at least Engineering does,
since at least one semester+summer internships is de rigueur
(2 is preferred)

So one kid=$100K , 2 kids=$200K

Yes, I have 2 kids in at the same time this fall.

My youngest was somewhat dumbfounded when I showed him the total.
Luckily he has about $30K in scholarship money over 4 years. That is still is
less than half.

The alternative for state schools is higher state taxes. I don't see anyone clamoring for that.
(Yes, it sounds like you were talking about private schools.)

We did look at MIT and Stanford, both are currently above $50K per year, as you have noticed.
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Re: College costs, anyone else spit coffee on their monitor?

Postby inbox788 » Thu May 16, 2013 2:21 pm

DoWahDaddy wrote:I've been putting away the max in my 401k, and into non-deductible IRAs for me and the Mrs. Beyond that, we've been splitting between 529s for both kids, and taxable investments.

I'm interested in what others do, split somehow between 529s and taxable investments as well, or allocate solely to one of the two, and what the reasoning is.


My thoughts on this matter have changed over the last decade. I started thinking of the limitations of 529 accounts with high fees. Don't remember if low fee index funds were available, but I remember 1%+ fees that over 20 years would be comparable to long term capital gains taxes. I went with higher risk, higher return strategy, which turned out only slightly better than if I just put it in a 529 account low fee s&p index after taxes. I did gain the flexibility that the funds are not restricted to education. The total amount wasn't that much, so today, I'm looking to transferring the taxable funds into a 529, and continuing to add to it. Two things changed, first I have more to contribute to college fund and I'm getting a better gauge of how much college is going to cost. I'm budgeting $200-300k to cover an expensive private college, and any savings can be applied to graduate school or passed down. I'd only need to contribute about half that, and the gains would be tax free. Estimate tax benefit is worth at least $20k on $100k. That Is the aftertax return youd have to beat by going with taxable.

If I had a do over, and I had excess funds, I'd do a one lump 5 year contribution from both parents when the pregnancy test turned positive or earlier if possible, but come to think of it, gift tax might require that it be after birth. I think that $130k post tax income, but all the growth would be tax free. Put it all on low cost index fund like VT or VTI and expect it to double or triple by the time the child starts college. A $250k gain would yield about $50k tax benefit.
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Re: College costs, anyone else spit coffee on their monitor?

Postby bungalow10 » Thu May 16, 2013 2:25 pm

Our kids are 5yo, 3yo, and four months old and DH and I estimate college will be $500,000 for the three of them, all-in, at a state school.

We are saving a little now, $3k/year/each to get the state income tax benefit. When we start winding down on daycare ($2k/month right now - OUCH), we will open a 529 for each of us (another $6k/year) and just keep plugging away. I'm sure we'll have to cash-flow some of it, and our kids will have to work.
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Re: College costs, anyone else spit coffee on their monitor?

Postby danwhite77 » Thu May 16, 2013 2:32 pm

I try (largely unsuccessfully) to not torture myself with this. I have four kids, so this is at the forefront of my mind. I max out 401k and then every other investment dollar goes to 529s. IMHO, like housing before it this is another bubble, again fueled by government backed loans. Once the loan is repaid under every circumstance, the lender's discipline goes out the window and costs sky rocket. The problem is, I don't see how this bubble will pop. I think eventually the new normal will be for most college grads to die with student loan debt (except for the very wealthy) because the government will always blindly support this large transfer of wealth from students (and their parents) to academia (and most importantly, academic administrators).
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Re: College costs, anyone else spit coffee on their monitor?

Postby mhc » Thu May 16, 2013 2:33 pm

My oldest of three is 9 years from college. My plan is to fund state schools. Current price for the local state school is $12k/yr ($12k * 3 * 4 = $144k). I have saved about 2/3 in 529's and Coverdells. I am not contributing any new money. I am trying to save enough for retirement before my first child hits college. That way I could divert everything that I am currently saving for retirement to college if need be. If I don't need extra money for college, then I will just retire early.

I am leery to save too much because what happens if one of the kids does not go to college or gets a lot of scholarships.
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Re: College costs, anyone else spit coffee on their monitor?

Postby Pacific » Thu May 16, 2013 2:39 pm

HomerJ wrote:I just put two kids through college...

University of Kansas... about $15k a year including room and board... $60k total for each of their degrees... And that's with sorority fees... Could be done for less.

There should be a simple college admission test.

"Are you willing to pay $200k for your undergraduate college degree?"

If they answer "Yes", then they are too stupid to go to college....

(I kid, I kid!)

But seriously, if you don't get scholarships or financial aid, then don't go to those expensive private schools. There are plenty of very good public state schools that offer reasonable in-state tuitions.


Yes, but seriously, at that price your daughters had to suffer through KU football seasons :)
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Re: College costs, anyone else spit coffee on their monitor?

Postby JupiterJones » Thu May 16, 2013 2:39 pm

HomerJ wrote:There should be a simple college admission test.

"Are you willing to pay $200k for your undergraduate college degree?"

If they answer "Yes", then they are too stupid to go to college...


LOL! That is the best thing I've read all day!

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Re: College costs, anyone else spit coffee on their monitor?

Postby bungalow10 » Thu May 16, 2013 2:41 pm

mhc wrote:
I am leery to save too much because what happens if one of the kids does not go to college or gets a lot of scholarships.


I believe you can withdraw the amount of any scholarships without penalty.

Personally, I'm not too scared about oversaving. No matter what, most people are going to need some type of job training. They may not go to university when they are 18, but they may decide when they are 22 that they need to go to community college for auto mechanics, dental hygiene, nursing, HVAC, etc.
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Re: College costs, anyone else spit coffee on their monitor?

Postby livesoft » Thu May 16, 2013 2:44 pm

Before our kid started college we were already over 50 years old and contributing the max to our 401(k)'s (say $23,000 each in 2013) and Roth IRAs (say $6,500 each in 2013). Thus, instead of saving 2 x ($23K + $6.5K) = $59K in retirement accounts annually, we could just divert that money to college expenses if needed.

Of course we had to be used to maxing out retirement plan contributions over the years and not spending that money. So if folks started early with retirement contributions, they might be used to sending big chunks of money to other places. College is just a different place.
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Re: College costs, anyone else spit coffee on their monitor?

Postby inbox788 » Thu May 16, 2013 2:54 pm

danwhite77 wrote:I try (largely unsuccessfully) to not torture myself with this. I have four kids, so this is at the forefront of my mind. I max out 401k and then every other investment dollar goes to 529s. IMHO, like housing before it this is another bubble, again fueled by government backed loans. Once the loan is repaid under every circumstance, the lender's discipline goes out the window and costs sky rocket. The problem is, I don't see how this bubble will pop. I think eventually the new normal will be for most college grads to die with student loan debt (except for the very wealthy) because the government will always blindly support this large transfer of wealth from students (and their parents) to academia (and most importantly, academic administrators).


Wow, 4 kids?!? I'd take a different tack with that. Learn the current financial aid rules and hope they don't change much. I'd make it clear to the kids that they're responsible for their education, and they may turn up better for it. Scholarships, grants, sports?, state schools, work-study, etc.

A couple of quirks that come to mind are to keep all the kids money. Charge them rent and board :P. Student contributions are much higher than parents.

Spend down your cash and assets and pay down your mortgage. Home is exempt from parents assets in calculations. If you own a million dollar house, but don't have a dime to your name, you're poor. If you have same home with jumbo mortgage and $800,000 investments, you're rich.

http://www.finaid.org/fafsa/maximize.phtml

Unless you're paying all expenses, 529 may not make that much sense.

BTW, some states have more benefits for 529 plans so that make a big difference in the appeal of the plan. Not mine, but look up yours to decide.
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Re: College costs, anyone else spit coffee on their monitor?

Postby MindBogler » Thu May 16, 2013 2:55 pm

ourbrooks wrote:Alas, the real cause of the rise in college tuition is simple to understand; between the 1970's and today, the number of students attending college has increased by a factor of 3! That means 3 times as many classrooms, 3 times as many professors, 5 times as many parking spaces, etc. If you factor in inflation, about 30 times as much money is need for college education today as in the 1970s.

Then, economies of scale should have lowered the price in nominal dollars, so that can't be true.
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Re: College costs, anyone else spit coffee on their monitor?

Postby inbox788 » Thu May 16, 2013 3:06 pm

mhc wrote:I am leery to save too much because what happens if one of the kids does not go to college or gets a lot of scholarships.


You can save more by adding other eligible expenses besides tuition. Fees, books, equipment, etc. Also room and board if they don't live at home.

http://www.irs.gov/publications/p970/ch08.html
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Re: College costs, anyone else spit coffee on their monitor?

Postby TomatoTomahto » Thu May 16, 2013 3:06 pm

Sam I Am wrote:Wife and I have had a pretty blessed life thus far.
[snip...]
So, we will attempt to pay it forward as much as we can.


How refreshing and commendable to see your response to good fortune is to share it with others.

Good on 'ya.
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Re: College costs, anyone else spit coffee on their monitor?

Postby shersch » Thu May 16, 2013 3:21 pm

There are myriad other ways to save money, too. Just a few ideas that added up for me during my first undergrad [admittedly some time ago]:

1. Make friends with the Freshmen -- they enjoy having the mentorship of an older upperclassman, and you'll enjoy "buddy passes" to the lunch halls on campus even if you don't yourself have a meal plan.
2. As soon as you get scheduled for the upcoming term, use your library's interlibrary loan system to request the books you'll need. Buy new? Buy used? Hows about don't buy at all!?? Almost no one thinks if this.
3. Apply for private scholarships even if you don't fit their requirements -- very often you'll be one of a few applicants, and they may pick you anyhow! If it's free to apply, and there's a $400 grant on the line, it's worth a shot. I got many thousands this way, and I was by no means an "A" student.
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Re: College costs, anyone else spit coffee on their monitor?

Postby Rodc » Thu May 16, 2013 3:55 pm

HomerJ wrote:I just put two kids through college...

University of Kansas... about $15k a year including room and board... $60k total for each of their degrees... And that's with sorority fees... Could be done for less.

There should be a simple college admission test.

"Are you willing to pay $200k for your undergraduate college degree?"

If they answer "Yes", then they are too stupid to go to college....

(I kid, I kid!)

But seriously, if you don't get scholarships or financial aid, then don't go to those expensive private schools. There are plenty of very good public state schools that offer reasonable in-state tuitions.


Yes. Absolutely no one should go deep in debt to send their kids to a full price private school. Outside of the Ivies, pretty commonly it seems, if your kid has to the chops to deserve an expensive school they can get good scholarships that bring the cost way down. Why would you spend that kind of money on a mid-level student? Kids can get fine educations at many lower cost schools if they apply themselves. If they don't apply themselves you definitely should not be shelling out big bucks.

If they have the chops to get into MIT or Harvard (for example) they won't get aid, and then you have something of a choice because those schools do have such a prestigious reputation. Even then, if the cost is not reasonably comfortable there are other very high end schools where they will be able to get aid and will get a great education.

The deal we made with our kids (one finished) is we will pay for 4 years at the state flagship U. Worked great for the first one. If the younger ones want something else they have to be smart and savvy enough to figure out how to fund it. And they will be heavily educated on the effect of student loans.
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Re: College costs, anyone else spit coffee on their monitor?

Postby ray.james » Thu May 16, 2013 3:58 pm

I finished college 3 years ago and 2 more cousins making their way. Just a couple of thoughts on college costs

1) Living a block outside the college and not in dorms - saves a lot of money. This is straight forward 30-40% expenses saved. Besides one get to deal with landlords, managing utility bills, other living costs, sharing kitchen with others. It taught me a number of things. 10-20 mins a day on commute is not making me stressed!

2) If you ever walked in to dorms, you will see the food wastage and the reason for the real costs associated. Besides, one is not pushed to every weekend nonstop parties.

3) Regarding MIT and stanford: the 50k= 26k fees + 6k books+ living expenses. As someone mentioned, a lot of senior/freshman have textbooks lying around.

4) Place matters: For choice of school, it is always beneficial to prefer more urban/job resourceful zone school for higher costs(to some extent). The local companies always have talks/collaboration projects with school and good way to network and land internship/jobs. Just applying on school job board is useless these days.

5) Work for school/professor/local projects in senior year. After campus/part-time jobs during freshman, it is worth to work under a professor on research /industrial projects. These opportunities open during senior year landing potential jobs, contacts with professors etc which are extremely valuable for higher education and jobs even though less pay.

In my case, I was also lucky as my parents picked up interest part through my college/pre-earning years( and tax breaks for them). I realized the effect of interest by the short time it took to pay off, once I started earning. I also feel, this is the better way to make us understand the basic money principles.
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Re: College costs, anyone else spit coffee on their monitor?

Postby danwhite77 » Thu May 16, 2013 4:05 pm

Thanks, inbox788, but I think as far as 529 v. maneuvers to maximize aid I'm pretty much sunk. I'm probably going to land somewhere in that giant chasm of "too much money to qualify for aid but too little to pay everything," so I may as well attempt to try and pay for it all. I'll be able to sleep a little better that way knowing that I gave it a shot . . .

Also of note, I will be paying my own student loans when I'm also paying for my kids' college. I am, however, one of the lucky ones that graduated at the right time and have a relatively modest amount consolidated at a whopping 1.75% interest rate, so I have that going for me! :happy
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Re: College costs, anyone else spit coffee on their monitor?

Postby wageoghe » Thu May 16, 2013 4:11 pm

Sam I Am wrote:Wife and I have had a pretty blessed life thus far. Our children are grown, all college educated. What worked for us was purchasing prepaid tuition plans.

Now I've turned my attention to the grandchildren. I know that retirement could be more difficult for my children, given the fact that pensions are falling by the wayside in many companies. Frankly I'd much rather my children concentrate on building their retirement portfolios.

We have purchased prepaid tuition plans for our three (soon to be four) grandchildren. That effort at least secures for them four years of tuition and fees at the most expensive university in our state's university system. The plan has reciprocal agreements with several other states, and will also pay the state tuition amounts to accredited private colleges and universities.

We also are funding a 529 plan, as are the other grandparents, I believe.

I think the parents will be too wealthy to expect much aid, other than merit-based, and too poor to afford some tuitions. Right in the middle of the pack, in other words! :oops:

So, we will attempt to pay it forward as much as we can.

Sam I Am


Regarding prepaid tuition plans... Be careful! In my state, Alabama, we had something called PACT: http://treasury.alabama.gov/pact/

PACT was supposed to guarantee four years of tuition at state schools (or that equivalent amount could be spent at out of state schools). Between overly optimistic assumptions on returns from investment and rate of tuition increase, the program became essentially insolvent in recent years. Towards the end, the amount of tuition that would be paid was based on tuition costs as of 2010. I'm not really sure what people that were still a long time from utilizing their PACT plans. I think that they could get back the money that they put in.

Anyway, always do your due diligence and try to verify the financial health of any prepaid tuition plan.
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Re: College costs, anyone else spit coffee on their monitor?

Postby MnD » Thu May 16, 2013 4:11 pm

So there are colleges that charge ~$250K for one undergraduate degree.
Like anything in that price range, just because they do exist and are offered for sale doesn't mean you are compelled to buy them.
If that fits into your financial plans along with your other goals and desires - great. If not, you'll probably want to pass on that offer.
There are plenty of alternatives.
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Re: College costs, anyone else spit coffee on their monitor?

Postby letsgobobby » Thu May 16, 2013 4:11 pm

It's a real challenge if you grew up with the cultural expectation that parents pay for college, no questions asked. The world has changed and will continue to change and that's been a hard pill to swallow for this Chinese-Jewish Tiger Parent of two soon to be geniuses-I'm-sure.

In general the tax advantages for retirement saving are better than those for college savings, so it's best not to save explicitly in a 529 or ESA unless all tax-advantaged retirement space is already used up. Even if that implies 'oversaving' for retirement, it creates better options in the future, as livesoft points out, because you can divert future income to college payments from retirement savings and come out good in the end.

The logic is more complicated if you have a state tax benefit for 529 contributions, especially if your children might be eligible for need-based aid later on: your retirement savings do not increase your EFC (estimated family contribution) to college costs, but your 529 savings will. Since state tax benefits for 529 investing only exist in states with a state income tax, I recommend you move to a state with no income tax. That solves multiple problems at once. :sharebeer

Tax-deferred investing for 30-50 years in a 529 is very attractive and the estate planning benefits of 529 plans are not to be ignored. Therefore, after maxing all retirement space, our strategy has been to contribute to 529s over taxable accounts, especially with the higher tax rates this year on investment income and (if applicable) non-qualified dividends.
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Re: College costs, anyone else spit coffee on their monitor?

Postby nirvines88 » Thu May 16, 2013 4:13 pm

Hard to believe the tuition for my freshman year of college cost $5,000...in 2006. My dorm cost more than my tuition! This was at an in-state school (in the top 3 for my state). It's gone up the maximum amount (6-7% per year) every year since then. Compound interest in action!
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Re: College costs, anyone else spit coffee on their monitor?

Postby beachplum » Thu May 16, 2013 4:34 pm

ray.james wrote:I finished college 3 years ago and 2 more cousins making their way. Just a couple of thoughts on college costs

1) Living a block outside the college and not in dorms - saves a lot of money. This is straight forward 30-40% expenses saved. Besides one get to deal with landlords, managing utility bills, other living costs, sharing kitchen with others. It taught me a number of things. 10-20 mins a day on commute is not making me stressed!

2) If you ever walked in to dorms, you will see the food wastage and the reason for the real costs associated. Besides, one is not pushed to every weekend nonstop parties.

.

Living off campus is not always cheaper. this is totally dependent on where your university/college is located. Where my daughter's went to university the landlords pretty much charged the same amount as the school dorms and their apartments were far inferior. they would have had to live a lot further away from school to maybe get a savings. that would mean they would need cars to get to and from school which is added expense. the closer the apartments to their school the more the rent and the more crappy the apartment. I don't know the cost of living in dorms at MIT. But I know the costs of apartment rentals in or near Cambridge/Boston and it's very expensive, and that's if you can find someone to rent to an undergrad.
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Re: College costs, anyone else spit coffee on their monitor?

Postby ray.james » Thu May 16, 2013 5:22 pm

beachplum,

I agree, in general downtown universities in Boston/Cambride/in west coast LA(USC)/Portland, it is expensive to live outside. Most other colleges have this opportunity of cheaper places outside or a 10 min public commute. The difference between 1 bed/ 2 bed/3bed in apartment complexes was usually 20% for extra bedroom. I also agree any college town places have very old rooms/paint fall offs / old shower systems/roach trouble. But its part of life, being broke in school and to deal with it.
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Re: College costs, anyone else spit coffee on their monitor?

Postby tylerherman » Thu May 16, 2013 5:37 pm

Pretty much if you're not going to be a Doctor, Lawyer, Dentist, Architect you are out of your mind to go to any school other than a public school in your own state.
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Re: College costs, anyone else spit coffee on their monitor?

Postby HomerJ » Thu May 16, 2013 6:19 pm

Pacific wrote:Yes, but seriously, at that price your daughters had to suffer through KU football seasons :)


Ha! But one of them got to enjoy a NCAA Basketball National Championship in 2008....

The other had to suffer last year when Kansas lost in the finals. She'll be a senior next year, so she has one more chance.... :)
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Re: College costs, anyone else spit coffee on their monitor?

Postby prudent » Thu May 16, 2013 6:53 pm

One thing that astounds me about college costs. When I started (at a private) college, my parents had nothing to give me. They were so far in debt from medical bills there was nothing left. But between modest grants, some loans, a summer job and working 12 hours a week while in school, I paid my own way. I don't remember the exact figures, but my summer job covered half my tuition for the year, and my loans were about 25% of my tuition. When I got out of school and got a mediocre job I was able to pay my loans off in 4 years. It was not a crippling amount, nor did I really fret over it.

I doubt that it's even possible today to cover half a year of tuition from a summer job. I am happy for those who can cover their kids' college but if things don't change, it's going to be the colleges that must change.

I really think in my lifetime people will be able to get a degree completely online, and not having to pay through the nose to do it. Some enterprising outfit will figure out how to be accredited and deliver a quality education at a fraction of the usual cost. I will be interested to see what the B&M schools do then.
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Re: College costs, anyone else spit coffee on their monitor?

Postby Atilla » Thu May 16, 2013 7:36 pm

There's a reason I refer to it as the Education Industrial Complex. :twisted:

During my little stint from 1985-1990, BIG10 tuition doubled from $750 a semester to $1,500.

Anything the powers-that-be try to make more "affordable", the more problems you get. Health care, college and home ownership are three prime examples. :annoyed
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Re: College costs, anyone else spit coffee on their monitor?

Postby MathWizard » Thu May 16, 2013 10:25 pm

3) Regarding MIT and stanford: the 50k= 26k fees + 6k books+ living expenses. As someone mentioned, a lot of senior/freshman have textbooks lying around.


You are a little off. Books are nowhere near $6K. Tuition alone is over $42K plus abou $1K extra in various fees.
The total with living expenses is closer to $60K than $50K.

http://www.stanford.edu/dept/finaid/undergrad/budget/

Estimated cost of attendance for 2013-14 school year: $60,749

Room and board are needed, most people don't live with commuting distance of Stanford or MIT.

Tuition for 2013-14 school year: $42,690
Estmated cost for books: $ 1,500
Fees: about $1,000
Room and Board $13,166
Personal Expenses $ 2,400


For MIT:
From http://web.mit.edu/facts/tuition.html

Tuition and fees 2012–2013 $42,050.
room and board $12,188
Books/personal expenses about $ 2,772.

Total 2012-13 $57,010
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Re: College costs, anyone else spit coffee on their monitor?

Postby clevername » Thu May 16, 2013 11:00 pm

Atilla wrote:There's a reason I refer to it as the Education Industrial Complex. :twisted:

During my little stint from 1985-1990, BIG10 tuition doubled from $750 a semester to $1,500.

Anything the powers-that-be try to make more "affordable", the more problems you get. Health care, college and home ownership are three prime examples. :annoyed


Industrial complex indeed. My undergrad cost $100 per credit hour in 2008 when I graduated and now it is up to well over $200. My understanding is that the availability of student loans has increased dramatically in the last couple decades while the number of accredited universities has remained relatively stagnant. Simple supply and demand dictates the price of education will rise accordingly.

I can rant for hours about the price and quality of education but it is hard to explain to anyone who hasn't been back to school recently. I basically pay many many thousands of dollars per year to be herded through classes, thrown an A, given credit, and pushed out the door. I've attended three universities and one community college and it's the same story everywhere: $$$$$$$
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Re: College costs, anyone else spit coffee on their monitor?

Postby SpecialK22 » Fri May 17, 2013 1:02 am

I would also agree that costs can not rise indefinitely, but I still believe they have not reached the top. I think the system will work itself out in some way. Even within my current career field it seems to be happening. Four year degrees are basically becoming more of a last resort option, particularly the overpriced ones from private non-profits. Two year community college degrees or the military--primarily Air Force, but the Marines and Navy also have excellent programs--seem most preferred. It's tough to say which option between the military and community colleges is better though. Community college is relatively cheap and quick (two years or less), but it may take a few years to actually get going in one's career, especially in today's environment. With the Air Force, one receives paid for training, great benefits, and generally excellent immediate career prospects upon getting out (Meh, I sound like a recruiter). Plus the government is the biggest employer, so military time can cheaply be bought back and added to one's federal pension, and one starts with more vacation time/pay than either community college or university grads. The downside is the Air Force only offers a six year enlistment option for this career field, so it does require signing six years of one's life away. Marines are six years as well (I believe), but Navy is five. Eventually it'll get to the point where Air Force recruiters suggest college to unfit applicants, instead of the Army :wink:
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Re: College costs, anyone else spit coffee on their monitor?

Postby Colorado13 » Fri May 17, 2013 8:10 am

In CO and in many other states, the issue is that public college costs are shifting from all taxpayers to students who have to pay higher tuition. For example in CO, "state funding for higher education has DECREASED by $216 million, or 31 percent, over the last two years alone." http://www.denverpost.com/news/ci_20399 ... -imperiled.

These costs are being shifted to the students because taxpayers have limited interest in funding education. I realize that CO is at/near the bottom of the barrel regarding education funding from the state (and CO is a mildly low income tax state, so revenues have declined significantly in the past few years), but the shifting of costs from taxpayers/state revenue to students is occurring across the country.

Tuition for CU Boulder: http://www.collegecalc.org/colleges/col ... o-boulder/

2010 - $7,932 In State / $28,186 Out of State Tuition and Fees. 9% Annual Increase
2009 - $7,278 In State / $26,756 Out of State Tuition and Fees. 9.7% Annual Increase
2008 - $6,635 In State / $24,797 Out of State Tuition and Fees. 17.6% Annual Increase
2007 - $5,643 In State / $23,539 Out of State Tuition and Fees. 5% Annual Increase
2006 - $5,372 In State / $22,826 Out of State Tuition and Fees. 23.8% Annual Increase
2005 - $4,341 In State / $21,453 Out of State Tuition and Fees. 8% Annual Increase
2004 - $4,020 In State / $20,336 Out of State Tuition and Fees. 12.7% Annual Increase
2003 - $3,566 In State / $18,910 Out of State Tuition and Fees. 6.2% Annual Increase
2002 - $3,357 In State / $17,367 Out of State Tuition and Fees. 5.3% Annual Increase
2001 - $3,188 In State / $16,506 Out of State Tuition and Fees. 2.2% Annual Increase
2000 - $3,118 In State / $15,898 Out of State Tuition and Fees. 2.6% Annual Increase
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Re: College costs, anyone else spit coffee on their monitor?

Postby investingdad » Fri May 17, 2013 9:23 am

My wife and I both graduated from Penn State. We're doing pretty well for ourselves and would have no problem sending our two kids to a State U at a much lower cost than an expensive private school.
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Re: College costs, anyone else spit coffee on their monitor?

Postby arthurb999 » Fri May 17, 2013 9:32 am

I personally think college costs are the next thing to crash. This has bubble written all over it.
The ROI is just not there in a lot of cases...

There is an entire generation... strapped with tremendous debt, little means to repay, and the debt cannot be discharged in BK.
Granted they should have thought things through (e.g 200k for an art history degree with salaries in the 40k range).
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Re: College costs, anyone else spit coffee on their monitor?

Postby HardKnocker » Fri May 17, 2013 10:07 am

investingdad wrote:My wife and I both graduated from Penn State. We're doing pretty well for ourselves and would have no problem sending our two kids to a State U at a much lower cost than an expensive private school.


Just a note that Penn State is one of the most expensive state colleges/universities.
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Re: College costs, anyone else spit coffee on their monitor?

Postby stoptothink » Fri May 17, 2013 10:18 am

HardKnocker wrote:
investingdad wrote:My wife and I both graduated from Penn State. We're doing pretty well for ourselves and would have no problem sending our two kids to a State U at a much lower cost than an expensive private school.


Just a note that Penn State is one of the most expensive state colleges/universities.


Was about to point that out. I recently saw the tuition breakdown for PSU and was absolutely floored.

I finished my education last year. I think tuition was raised every single quarter during my last 1.5yrs, luckily I wasn't paying any. At the university where I did my undergrad, when I began in '00 I think full-time tuition was like $800/qtr and it is now nearly $3k.
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Re: College costs, anyone else spit coffee on their monitor?

Postby bungalow10 » Fri May 17, 2013 10:23 am

arthurb999 wrote:I personally think college costs are the next thing to crash. This has bubble written all over it.
The ROI is just not there in a lot of cases...

There is an entire generation... strapped with tremendous debt, little means to repay, and the debt cannot be discharged in BK.
Granted they should have thought things through (e.g 200k for an art history degree with salaries in the 40k range).


I think the media blows things out of proportion. The average debt of a 2012 graduate is $27,000. That's not horrible. My brother graduated in 2006 with $20k in debt and paid it off by 2011 on a $30-35k/year job. Yes, he lived like a pauper, which is how most people of previous generations spent their 20s anyway, so it wasn't a huge deal. He was debt-free by 30 even though he graduated two years later than most.

The people that are really up a creek with out a paddle are those that get the debt and fail to graduate.
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Re: College costs, anyone else spit coffee on their monitor?

Postby stoptothink » Fri May 17, 2013 10:28 am

bungalow10 wrote:
arthurb999 wrote:I personally think college costs are the next thing to crash. This has bubble written all over it.
The ROI is just not there in a lot of cases...

There is an entire generation... strapped with tremendous debt, little means to repay, and the debt cannot be discharged in BK.
Granted they should have thought things through (e.g 200k for an art history degree with salaries in the 40k range).


I think the media blows things out of proportion. The average debt of a 2012 graduate is $27,000. That's not horrible. My brother graduated in 2006 with $20k in debt and paid it off by 2011 on a $30-35k/year job. Yes, he lived like a pauper, which is how most people of previous generations spent their 20s anyway, so it wasn't a huge deal. He was debt-free by 30 even though he graduated two years later than most.

The people that are really up a creek with out a paddle are those that get the debt and fail to graduate.


The media certainly isn't blowing the insane increase in tuition costs out of proportion. At some universities (as I noted earlier, including where I did my undergrad) tuition has tripled in the past decade. To say that is cause for concern would be a mild understatement.
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Re: College costs, anyone else spit coffee on their monitor?

Postby imgritz » Fri May 17, 2013 10:32 am

I had a heart-attack when my university fees went from $100 a semester to $150. That's highway robbery! Yes, I went to school when dinosaurs roamed the earth.
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Re: College costs, anyone else spit coffee on their monitor?

Postby Bacchus01 » Fri May 17, 2013 10:34 am

ourbrooks wrote:Alas, the real cause of the rise in college tuition is simple to understand; between the 1970's and today, the number of students attending college has increased by a factor of 3! That means 3 times as many classrooms, 3 times as many professors, 5 times as many parking spaces, etc. If you factor in inflation, about 30 times as much money is need for college education today as in the 1970s.



Uh, then you'd have 3 times as many people paying, or did all those people go for free?

Send your kids to a public university, or *GASP* make them find their own way!

My wife and I have BS and MBAs both. Our parents didn't contribute a single dime for either of us. We graduated with less than $30K in debt from very good state schools. Our MBAs were paid by our employers.
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Re: College costs, anyone else spit coffee on their monitor?

Postby letsgobobby » Fri May 17, 2013 10:48 am

At least at public schools, the costs adjusted for inflation, labor/health care costs of employees, and student enrollment haven't risen that much at all. But state support for public schools has been cut dramatically, in most states reaching at least a negative 30-40% per full-time student adjusted for inflation between 2007-2012. That's a stunning philosophical shift in the 'who pays, who benefits' calculus of higher education:

http://online.wsj.com/article/SB1000142 ... 73548.html

http://online.wsj.com/article/SB1000142 ... 70002.html

In Washington, the state used to pay for 80% of the costs of a public university education. Now it's down to about 30%. That is where the enormous growth in student tuition has come from. It's sad.

For anyone able to get into guaranteed prepaid tuition contracts 5-10 years ago, they have perversely benefited from this shift away from public funding. I think that arbitrage opportunity is gone. Now it's clear schools have to really cut costs, not just cost shift; and they really have to provide value, and compete, including with online schools and other non-traditional venues (including community college, technical degrees, overseas institutions). We're starting to see that as increasing numbers of private schools have vowed to keep tuition flat; or limit raises to essentially COLA; etc. My alma mater's tuition is up only 3.5% for 2013-14, and no tuition for families with income less than $100,000 and free tuition, room, and board for families with income below $60,000.

In my state (Washington) there are growing numbers of students headed to Canada for university. It's not cheaper than going to UW, yet, but it's cheaper than going to a private university in the United States.
Last edited by letsgobobby on Fri May 17, 2013 10:55 am, edited 2 times in total.
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Re: College costs, anyone else spit coffee on their monitor?

Postby Grt2bOutdoors » Fri May 17, 2013 10:53 am

stoptothink wrote:
HardKnocker wrote:
investingdad wrote:My wife and I both graduated from Penn State. We're doing pretty well for ourselves and would have no problem sending our two kids to a State U at a much lower cost than an expensive private school.


Just a note that Penn State is one of the most expensive state colleges/universities.


Was about to point that out. I recently saw the tuition breakdown for PSU and was absolutely floored.

I finished my education last year. I think tuition was raised every single quarter during my last 1.5yrs, luckily I wasn't paying any. At the university where I did my undergrad, when I began in '00 I think full-time tuition was like $800/qtr and it is now nearly $3k.


I recall a conversation I had about two years ago with one of PSU's recruiters that traveled to my town to gather some sheeple for the incoming class, we were speaking about the hard dollar cost of attending college and he said to me with a straight face that it cost $38,500 "all-in" to pay for one year at State College campus - it was like saying it only cost $1 but look at all the rewards of attending the premiere campus, the football games, Joe Pat, and salaries were higher because you graduated PSU. :oops: Sorry, but spending $160K for a 4 year party is not my idea of a great ROI. My kid is going to school to learn something useful, not get wasted, party and oh, as an afterthought graduate.
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