How to get child's skin in the game for college?

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
luckybamboo
Posts: 199
Joined: Tue Nov 01, 2016 7:56 pm

How to get child's skin in the game for college?

Post by luckybamboo » Fri Feb 16, 2018 12:20 am

Hello,
I have two different issues that I need help with.
Our dd is 17 and has already secured admission in local public university and will start college in Fall 2018. We have about 3.5 years of her undergrad tuition+room&board saved as of today. My husband wants to only pay 3 years of her college and wants her to come up with the 4th year by either taking a loan, get a scholarship or earn money and save.
Our dilemma is this - after filling out FAFSA we got a letter that the maximum amount of loan she is eligible for is $5000. So, if she doesn't get scholarship or doesn't save money, how can she get loan to pay for her 4th year of college? Any other alternatives?
Secondly, dd isn't very responsible about her grades in the subjects she doesn't care about or are too theoretical. We are telling her that her education is a 'loan' from us which will be forgiven if her GPA is 3.2 or higher. Is this is a good way to hold her accountable?

So the issues are
1. How can a child of high earning parent get a student loan if necessary?
2. How to hold child accountable for the grades / performance to justify the free ride for college?
Thanks

msk
Posts: 874
Joined: Mon Aug 15, 2016 10:40 am

Re: How to get child's skin in the game for college?

Post by msk » Fri Feb 16, 2018 2:04 am

I find all this skin in the game for college education rather sad. IF you can afford paying 100%. You were happy to support her 100% for the past 17 years; why baulk at the final year in college? At college it becomes clearer as to what turns her on, hopefully not drugs. She will pay full attention to those subjects... IF you can afford it, just pay. All IMHO of course.

PS I have paid 100% for all my 4 kids, even though I have been blessed with a bunch that each could easily have received full scholarships (top of their high school classes, etc.). I specifically dissuaded them from applying for scholarships so as not to deprive some other, financially challenged, kids. You can often "guarantee" loans for practically anyone. Just talk to your local bank manager. As far as I experienced it (for a construction contract), the process is straightforward. You deposit cash in a CD, say, $20k, maturing at the end of the loan period, i.e. the "guarantee" period. Your kid takes a $20k loan from the bank. She pays all the instalments as agreed between the bank and herself, you cash your CD. She lets her loan default, the bank cashes your CD and recovers their outstandings.

Katietsu
Posts: 1544
Joined: Sun Sep 22, 2013 1:48 am

Re: How to get child's skin in the game for college?

Post by Katietsu » Fri Feb 16, 2018 2:25 am

You know your daughter best. I can only say that many 17 year olds are not going to experience any extra sense of responsibility or commitment because they have a loan. Working and saving might have a higher chance of accomplishing your stated goal depending on her level of motivation. On the other hand, what will you do if she doesn’t have the cash? Would you let her drop out?

User avatar
celia
Posts: 8211
Joined: Sun Mar 09, 2008 6:32 am
Location: SoCal

Re: How to get child's skin in the game for college?

Post by celia » Fri Feb 16, 2018 2:48 am

Our kids' "skin in the game" was that they had to buy their own school and dorm supplies (textbooks, computers, off-campus meals, clothing..)--anything that was not part of the college billings. Our kids already knew how to find used books from other students or to order them early online. This kept them from waiting until the last minute and loading up on brand new books that we would have to pay for. (They also sold them when they were done to pay for the following semester's books.)

The problem with taking a loan and putting it in savings for the last year is that next year's Expected Family Contribution is calculated such that the student's savings is expected to be spent first and can reduce aid in the following year.

Most college students have no idea how long it takes to pay off a $1,000 loan, let alone more. The amount is not anything they can relate to. It is not until they are done with school and they see the monthly payment, that they are shocked. If they don't find a job right away, they may feel stuck or depressed and may want to move back home.
Last edited by celia on Fri Feb 16, 2018 2:53 am, edited 1 time in total.

HornedToad
Posts: 877
Joined: Wed May 21, 2008 12:36 am

Re: How to get child's skin in the game for college?

Post by HornedToad » Fri Feb 16, 2018 2:49 am

If you want to do that then do $5k/year loans instead of trying to make her pay for an entire year herself. Then she gets skin in the game each year and you don't have a problem of saving or big bang payment. You can always decide to help her pay off the loan when she graduates as well.

Personally, I think the education is a loan that gets forgiven with 3.2 GPA is a horrible idea. It's good intentions but if you think thru the possible consequences and stress you might put on your daughter then I think there can be much better approaches. My wife had a terrible first semester at college and realized how she needed to study for classes better, that she wasn't cut out for once a week 3-4 hour classes, etc and didn't do well. The rest of college was fine and she graduated with a great GPA but imagine the stress if at the start of college career your dd has to consider whether she'll come out of it with 6 figure loan to her parents because she didn't study well. If you really have concerns for this, then just pay less upfront and make DD take out more loans and help pay them off when she graduates with good GPA, and potentially tell her that. That's a positive encouragement tactic instead of the punishment approach that you mentioned.

User avatar
celia
Posts: 8211
Joined: Sun Mar 09, 2008 6:32 am
Location: SoCal

Re: How to get child's skin in the game for college?

Post by celia » Fri Feb 16, 2018 2:57 am

By requiring her to have a certain GPA, the easiest way for her to do that is to take easy classes, those that don't lead to a career. Is that what you want to encourage?

User avatar
ClevrChico
Posts: 1260
Joined: Tue Apr 03, 2012 8:24 pm

Re: How to get child's skin in the game for college?

Post by ClevrChico » Fri Feb 16, 2018 3:02 am

Teach financial literacy before college possibly? OP has a good question.

bluejello
Posts: 428
Joined: Sun Sep 21, 2014 9:40 am

Re: How to get child's skin in the game for college?

Post by bluejello » Fri Feb 16, 2018 5:08 am

Congrats on your daughter's acceptance to college and starting a new phase of life!

To question #1: I suggest providing for her tuition and basics (room and board) for all 4 years but requiring that she purchase everything else — clothes, books, class materials, extracurricular costs, gas, cell phone, spending money, etc. This is good practice in budgeting and money management for life after college. I know people who relied on their parents to pay for expensive camera equipment for photography classes and pricey cosmetics when they were in college; you don't want to be those parents.

If she's going to a local public university maybe she can live at home to save on costs? Or if you want her to live on campus, you pay for her dorm room and a basic meal plan but she has to cover all other costs.

To question #2: One of the wonderful things about college is that you no longer have to take classes in subjects you don't care about. So if she does well in classes that she chooses, it should be fine. I'd say the key here is for her to understand the link between her GPA and career prospects after college. If you start with the end in mind (aka getting a job) it's much easier to understand why you're doing what you're doing.

Do you have any friends with children who are 3-5 years older than your daughter, i.e. who are about to graduate college and enter the job market or have recently graduated and found jobs? I'd set her up on coffee dates with them so they can share their experiences. Or, does her college have some sort of senior/freshmen mentoring program? I'd sign her up for that. I'd also heavily encourage her to take advantage of her college career office and counseling options. She should meet with a career advisor during her first semester to start getting some ideas about what the job prospects are like for different careers. And she should get an internship or a job every summer.

Best of luck!

bluejello
Posts: 428
Joined: Sun Sep 21, 2014 9:40 am

Re: How to get child's skin in the game for college?

Post by bluejello » Fri Feb 16, 2018 5:13 am

celia wrote:
Fri Feb 16, 2018 2:48 am
Our kids' "skin in the game" was that they had to buy their own school and dorm supplies (textbooks, computers, off-campus meals, clothing..)--anything that was not part of the college billings. Our kids already knew how to find used books from other students or to order them early online. This kept them from waiting until the last minute and loading up on brand new books that we would have to pay for. (They also sold them when they were done to pay for the following semester's books.)
Excellent idea!

User avatar
KSOC
Posts: 306
Joined: Sat Oct 29, 2016 3:53 pm
Location: Central Florida

Re: How to get child's skin in the game for college?

Post by KSOC » Fri Feb 16, 2018 5:47 am

2 daughters through Florida State. Both were told Mom & Dad will pay room & board. We also provided transportation. They had to pay tuition, & the deal was for a state school. We didn't push working in High School, as both used extra time for band & clubs.They took honors & college level courses. This allowed them to get good scholarships & grants. One graduated with 3.5 GPA & $8k debt. Other got through in 3 years, GPA 4.1 & $1k. Both witnessed frugality growing up. I kept a spreadsheet of the hard costs, & with incidentals wife & I spent almost $80k. This was a sacrifice wife & I took knowing we'd be living paycheck to paycheck. We both fortunatley kept our jobs through 2008 to 2009 downturn.

Like the OP, we wanted them to pay for some of the costs of college. We are thrilled both took college seriously & did not get burdened with a mountain of debt. Both daughters appreciated our help. :happy
Too soon old, too late smart.

z3r0c00l
Posts: 1129
Joined: Fri Jul 06, 2012 11:43 am
Location: NYC
Contact:

Re: How to get child's skin in the game for college?

Post by z3r0c00l » Fri Feb 16, 2018 7:20 am

Understand the biological onset of adulthood really starts around the mid/late 20's. 18-22 they are still essentially teenagers, albeit learning to become adults. In light of that, I would much rather pay the full tuition and make sure they are successful in school, take advantage of summer internships and other opportunities, etc. The main question is after school as this generation often spends years back at home. Perhaps that should be the emphasis in the last year, finding an employment pipeline and thence a plan to remain independent after school ends.

Having gone to a state school, I was lucky enough to leave with no debt. That was very important as it allowed for financial independence sooner and didn't force me to accept the first job that came along.

Grt2bOutdoors
Posts: 19075
Joined: Thu Apr 05, 2007 8:20 pm
Location: New York

Re: How to get child's skin in the game for college?

Post by Grt2bOutdoors » Fri Feb 16, 2018 7:33 am

Skin in the game - excuse for people to make when they want to have control over something or someone. Living in this crazy world is having plenty of skin in the game. Every individual is unique, if your daughter is incapable of succeeding in a collegiate environment then the choice is simple, don’t put her in one or do two years in community college before attending a senior college. Perhaps a vocational institution would be more appropriate?
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

Bacchus01
Posts: 1812
Joined: Mon Dec 24, 2012 9:35 pm

Re: How to get child's skin in the game for college?

Post by Bacchus01 » Fri Feb 16, 2018 7:37 am

luckybamboo wrote:
Fri Feb 16, 2018 12:20 am
Hello,
I have two different issues that I need help with.
Our dd is 17 and has already secured admission in local public university and will start college in Fall 2018. We have about 3.5 years of her undergrad tuition+room&board saved as of today. My husband wants to only pay 3 years of her college and wants her to come up with the 4th year by either taking a loan, get a scholarship or earn money and save.
Our dilemma is this - after filling out FAFSA we got a letter that the maximum amount of loan she is eligible for is $5000. So, if she doesn't get scholarship or doesn't save money, how can she get loan to pay for her 4th year of college? Any other alternatives?
Secondly, dd isn't very responsible about her grades in the subjects she doesn't care about or are too theoretical. We are telling her that her education is a 'loan' from us which will be forgiven if her GPA is 3.2 or higher. Is this is a good way to hold her accountable?

So the issues are
1. How can a child of high earning parent get a student loan if necessary?
2. How to hold child accountable for the grades / performance to justify the free ride for college?
Thanks

Have her take out the max loan each year, then pay the rest through your funds.

I don’t think graduating with a $20K loan is a bad deal.

She can also work or get scholarships and reduce that amount.

Bacchus01
Posts: 1812
Joined: Mon Dec 24, 2012 9:35 pm

Re: How to get child's skin in the game for college?

Post by Bacchus01 » Fri Feb 16, 2018 7:39 am

msk wrote:
Fri Feb 16, 2018 2:04 am
I find all this skin in the game for college education rather sad. IF you can afford paying 100%. You were happy to support her 100% for the past 17 years; why baulk at the final year in college? At college it becomes clearer as to what turns her on, hopefully not drugs. She will pay full attention to those subjects... IF you can afford it, just pay. All IMHO of course.

PS I have paid 100% for all my 4 kids, even though I have been blessed with a bunch that each could easily have received full scholarships (top of their high school classes, etc.). I specifically dissuaded them from applying for scholarships so as not to deprive some other, financially challenged, kids. You can often "guarantee" loans for practically anyone. Just talk to your local bank manager. As far as I experienced it (for a construction contract), the process is straightforward. You deposit cash in a CD, say, $20k, maturing at the end of the loan period, i.e. the "guarantee" period. Your kid takes a $20k loan from the bank. She pays all the instalments as agreed between the bank and herself, you cash your CD. She lets her loan default, the bank cashes your CD and recovers their outstandings.

I find it rather sad that people put other people down for simply wanting to share some responsibility with their ADULT child.

Grt2bOutdoors
Posts: 19075
Joined: Thu Apr 05, 2007 8:20 pm
Location: New York

Re: How to get child's skin in the game for college?

Post by Grt2bOutdoors » Fri Feb 16, 2018 7:40 am

celia wrote:
Fri Feb 16, 2018 2:57 am
By requiring her to have a certain GPA, the easiest way for her to do that is to take easy classes, those that don't lead to a career. Is that what you want to encourage?
We had a term for that in college “fluff class”, apparently there was an unwritten code amongst graduating seniors and upper juniors to let the incoming classes know before signing up, which professors and classes were “easy A’s”. :oops: Unfortunately I was not included on the distribution list when such disclosure were made. I worked for my degree.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

Grt2bOutdoors
Posts: 19075
Joined: Thu Apr 05, 2007 8:20 pm
Location: New York

Re: How to get child's skin in the game for college?

Post by Grt2bOutdoors » Fri Feb 16, 2018 7:43 am

Bacchus01 wrote:
Fri Feb 16, 2018 7:39 am
msk wrote:
Fri Feb 16, 2018 2:04 am
I find all this skin in the game for college education rather sad. IF you can afford paying 100%. You were happy to support her 100% for the past 17 years; why baulk at the final year in college? At college it becomes clearer as to what turns her on, hopefully not drugs. She will pay full attention to those subjects... IF you can afford it, just pay. All IMHO of course.

PS I have paid 100% for all my 4 kids, even though I have been blessed with a bunch that each could easily have received full scholarships (top of their high school classes, etc.). I specifically dissuaded them from applying for scholarships so as not to deprive some other, financially challenged, kids. You can often "guarantee" loans for practically anyone. Just talk to your local bank manager. As far as I experienced it (for a construction contract), the process is straightforward. You deposit cash in a CD, say, $20k, maturing at the end of the loan period, i.e. the "guarantee" period. Your kid takes a $20k loan from the bank. She pays all the instalments as agreed between the bank and herself, you cash your CD. She lets her loan default, the bank cashes your CD and recovers their outstandings.

I find it rather sad that people put other people down for simply wanting to share some responsibility with their ADULT child.
I find it rather sad and disappointing when others don’t agree with someone’s opinion and resorts to saying in an indirect manner or implying some level of bullying is occurring. The poster is not putting anyone down.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

user5027
Posts: 792
Joined: Sat Jun 16, 2012 8:54 pm

Re: How to get child's skin in the game for college?

Post by user5027 » Fri Feb 16, 2018 7:49 am

Our two children took the subsidized loans and the deal was if they finished school Mom & Dad paid off the loans and if they did not finish, they had to payoff the loans. I remember our son saying "that's a no brainer." They both finished and we paid.

string3599
Posts: 16
Joined: Sat Oct 22, 2011 3:07 pm

Re: How to get child's skin in the game for college?

Post by string3599 » Fri Feb 16, 2018 7:59 am

The college student is earning a degree that is going to setup his or her career and income earning potential for the rest of his or her life. I am of the opinion that is plenty of “skin in the game” without worrying about how to pay for said degree.

string3599
Posts: 16
Joined: Sat Oct 22, 2011 3:07 pm

Re: How to get child's skin in the game for college?

Post by string3599 » Fri Feb 16, 2018 8:01 am

user5027 wrote:
Fri Feb 16, 2018 7:49 am
Our two children took the subsidized loans and the deal was if they finished school Mom & Dad paid off the loans and if they did not finish, they had to payoff the loans. I remember our son saying "that's a no brainer." They both finished and we paid.
This plan doesn’t work so well with a well funded 529 plan.

User avatar
TomatoTomahto
Posts: 7538
Joined: Mon Apr 11, 2011 1:48 pm

Re: How to get child's skin in the game for college?

Post by TomatoTomahto » Fri Feb 16, 2018 8:04 am

msk wrote:
Fri Feb 16, 2018 2:04 am
I find all this skin in the game for college education rather sad. IF you can afford paying 100%. You were happy to support her 100% for the past 17 years; why baulk at the final year in college? At college it becomes clearer as to what turns her on, hopefully not drugs. She will pay full attention to those subjects... IF you can afford it, just pay. All IMHO of course.
+1. My younger child took a little longer "owning" his education, but as a friend told me, "25 is the new 18." Kids take time, some of them an extreme amount of time, to get it together. He's now doing part-time work as an EMT. Be patient. It's a tough world out there; don't add to it.

My older child (I'm leaving my two 30-year olds out of this) will be graduating this year. He took jobs that he didn't "need" to, because that's what appealed to him. I didn't make him pay college expenses, because I wanted to bribe him, and have him see how gratifying it is to save and invest. I fully understand that not every family has this option, but I don't understand why families that do would not choose the option. Disclosure: he got to invest money that he made during college, with the exception of really discretionary expenses, e.g., trips with his GF, which he was expected to pay out of his own money. He will graduate with something like $70k in Vanguard. More importantly, he will graduate with an understanding of the value of compounding, how important it is to live below your means, how to take full advantage of the opportunities that you find in life, etc.

IMO, this is how you get a kid to get the full ROI. Skin in the game is not being in debt when you graduate; skin in the game is going to a lecture when you could be partying, doing a problem set when you could be playing a video game, doing a summer internship when you could be hanging out at the beach.

Halicar
Posts: 82
Joined: Tue Oct 31, 2017 8:41 am
Location: Midwest

Re: How to get child's skin in the game for college?

Post by Halicar » Fri Feb 16, 2018 8:10 am

luckybamboo wrote:
Fri Feb 16, 2018 12:20 am

So the issues are
1. How can a child of high earning parent get a student loan if necessary?
2. How to hold child accountable for the grades / performance to justify the free ride for college?
Thanks
I guess people have different priorities, but I find this jaw-droppingly selfish. Pay for your child's education.

raisinsaregrapes
Posts: 127
Joined: Thu Dec 21, 2017 4:24 pm

Re: How to get child's skin in the game for college?

Post by raisinsaregrapes » Fri Feb 16, 2018 8:12 am

This is a good question, and the answer probably varies from kid to kid. My parents paid for half of all tuition, housing, and books. I kept a spreadsheet of my costs at the beginning of each quarter and would email it to my mom. Then she would send a check. I also was blessed to get a job in HS making above minimum wage, and worked a year between HS and college gaining skills at an engineering firm and saved money. I think the best thing my parents was not spoil me, but then helped me get a job early so I could start spoiling myself. None of my siblings graduated with loans, and we all had the 50% rule. We all had jobs during college to varying degrees, I only worked during summer and winter break, but graduated in 3 years.

noco-hawkeye
Posts: 329
Joined: Sat Aug 16, 2014 8:20 am

Re: How to get child's skin in the game for college?

Post by noco-hawkeye » Fri Feb 16, 2018 8:24 am

luckybamboo wrote:
Fri Feb 16, 2018 12:20 am
So the issues are
1. How can a child of high earning parent get a student loan if necessary?
2. How to hold child accountable for the grades / performance to justify the free ride for college?
Thanks
Some harsh advice / feedback:

1) . You should feel lucky you are a high earner. You want a loan in addition to being financially well off? I don't understand where you are coming from on this one.

2). You've had 17 years to form the child's values and get them ready for college. You need to let them sink or swim a bit now. Let's be honest - the money you have saved is going to pay for college expenses, if the GPA is a 3 or a 4. Let's not pretend otherwise - let the kid learn for herself.

OnTrack2020
Posts: 266
Joined: Mon Mar 20, 2017 10:24 am

Re: How to get child's skin in the game for college?

Post by OnTrack2020 » Fri Feb 16, 2018 8:24 am

luckybamboo wrote:
Fri Feb 16, 2018 12:20 am
Hello,
I have two different issues that I need help with.
Our dd is 17 and has already secured admission in local public university and will start college in Fall 2018. We have about 3.5 years of her undergrad tuition+room&board saved as of today. My husband wants to only pay 3 years of her college and wants her to come up with the 4th year by either taking a loan, get a scholarship or earn money and save.
Our dilemma is this - after filling out FAFSA we got a letter that the maximum amount of loan she is eligible for is $5000. So, if she doesn't get scholarship or doesn't save money, how can she get loan to pay for her 4th year of college? Any other alternatives?
Secondly, dd isn't very responsible about her grades in the subjects she doesn't care about or are too theoretical. We are telling her that her education is a 'loan' from us which will be forgiven if her GPA is 3.2 or higher. Is this is a good way to hold her accountable?

So the issues are
1. How can a child of high earning parent get a student loan if necessary?
2. How to hold child accountable for the grades / performance to justify the free ride for college?
Thanks
Re question #1. I think that is a tough one. Our son, attending university, came back to his dorm one day this last semester (mid-semester) to find his roommate had moved out. It seems the roommate wasn't able to get a loan. So, there are those cases where your child simply may not be able to get a loan, unless you as the parent want to be the "bank" and write up a promissory note, etc. There's not much your child can do if they don't have the means to get a loan. Our son, especially as he has hit the end of his freshman year, wanted to work full-time during the summer. Now, that he's coming toward the end of his sophomore year, is looking for an internship. I told him he had to give me "x" amount of dollars to go towards college from his summer job--we started this the summer he graduated high school. He has been okay with that--not enthusiastic, but okay. :)

Re question #2. Our son is on scholarship and must maintain a certain grade point average according to scholarship rules. I had to remind him of this often during his freshman year that if he didn't keep his grades up, he certainly would not be able to keep going to college where he is. I think that sank in.

The other thing I wanted to add is that you, depending on your income, may be eligible for the education tax credit of around $2500 per year. Maybe that saved over the next three years, combined with her working this summer and the summers of her freshman, sophomore, and junior year, will be enough to get her through her senior year. It will be a combination/contribution from both of you.

User avatar
Watty
Posts: 13824
Joined: Wed Oct 10, 2007 3:55 pm

Re: How to get child's skin in the game for college?

Post by Watty » Fri Feb 16, 2018 8:31 am

luckybamboo wrote:
Fri Feb 16, 2018 12:20 am
1. How can a child of high earning parent get a student loan if necessary?
This makes it sound like paying for her college is not a big hardship for you. If this is not true then it is critical to have frank discussions with your daughter about what support will will be able to provide so she can figure out what to do and does not have unrealistic expectations.

My son sounds a lot like your daughter and in both high school and college he always had pretty mediocre grades so our focus was on just getting him through college instead of having a high GPA.

Focusing on the GPA may also discourage her from getting a more challenging degree or to pad her schedule with easy classes when taking harder classes would be more beneficial.

For an elective she may have choice of taking a basic accounting class or painting. Which do you want her to take?

By focusing on her getting a high GPA you may be also fighting the wrong battle when the important battle is getting her to actually graduate. If you have not done it yet one of the first things to do is to get a realistic expectation of the odds that she will actually graduate which may be lower than you think.

You did not mention which University she will go to but someone else mentioned Florida State which has an 80% six graduation rate and only a 65% four year graduation rate. These are not all that bad. The college that my son went to had worse graduation rates and when my son went through his freshman year seeing a lot of the other people in his dorm drop out was more of an eyeopener to him than anything that we could have said or done. At many state universities there is a lot attrition during the freshman year so you might want to really just focus on that for now.

http://news.fsu.edu/news/university-new ... rate-rise/

Since your daughter is not a strong student her odds may be worse than average for her university.

You may also need to think of the consequences of your plan. If she takes out $5,000 a year in student loans starting out in her freshman year then drops out of college halfway through college where will that leave her? Probably working some low paid job with a five figure college loan. At that point you would likely be trying to get her through some vocational school so she could at least support herself and the debt and failure at college could be pretty overwhelming.

Every kid is different so you really don't know what will work with her and you may have to try several approaches to find out what actually works. It would be good to try to stay flexible.

Compared to many of the posters here we are pretty middle class but we were able to afford to pay for our son to go to a state university. Right or wrong here are the ground rules we used;

1) He was free to pick what degree he wanted to get but a high percentage of graduates had to be able to get jobs in that field even if it was not high paying. I only halfway joked with him that when I dropped him off at college that I would drop him off at the college job placement center instead of the dorm since he was going to a vocational school.

2) Since we were paying for his college we did not allow him to work during the school year for his freshman year and after that he could only work in a job that was related to his major. Our logic was that taking more classes instead of working at a fast food restaurant was a lot more cost effective.

His freshman year he had a roommate that was working at a Taco Bell, often until 2:00AM, and seeing the impact it had on him we are glad we made this rule. My son was majoring in Computer Science and he was able to get a job at the campus computer center which gave him good work experience.

3) We paid for his tuition, room, food, books, etc but he had to pay for his other expenses out of summer jobs and working at the computer center.

A few things that we could have done better.

1) Colleges often don't automatically send out grades to the parents anymore. You may need to figure out if you should have access to her college sign on to see her grades and even her test results during the semester.

2) Set higher expectations on how many hours of classes he would take each semester. It will vary by what program they are in and how much lab work they have but if she is not working then she should be able to take a pretty full load(16+ hours?).

3) No it is not OK to drop a class without talking to us first. (Don't ask :oops: )

Epilogue: My son chose to major in computer science which was a challenging program for him. He did not have real high grades but did OK in the core computer classes but he really struggled with all of the required advanced math classes. He had to take Calculus 3 three or four times to actually pass and that further hurt his GPA. He did graduate through with something like a 2.2 GPA now he is doing great in his career and once you have been working for a few years your college GPA means next to nothing.
Last edited by Watty on Fri Feb 16, 2018 8:45 am, edited 5 times in total.

OnTrack2020
Posts: 266
Joined: Mon Mar 20, 2017 10:24 am

Re: How to get child's skin in the game for college?

Post by OnTrack2020 » Fri Feb 16, 2018 8:36 am

noco-hawkeye wrote:
Fri Feb 16, 2018 8:24 am
luckybamboo wrote:
Fri Feb 16, 2018 12:20 am
So the issues are
1. How can a child of high earning parent get a student loan if necessary?
2. How to hold child accountable for the grades / performance to justify the free ride for college?
Thanks
Some harsh advice / feedback:

1) . You should feel lucky you are a high earner. You want a loan in addition to being financially well off? I don't understand where you are coming from on this one.

2). You've had 17 years to form the child's values and get them ready for college. You need to let them sink or swim a bit now. Let's be honest - the money you have saved is going to pay for college expenses, if the GPA is a 3 or a 4. Let's not pretend otherwise - let the kid learn for herself.
I don't think there is anything wrong with this. We had "x" amount of money set aside for college to divide over 4 years of college. Even though we have the money to pay additional, we also wanted our kid to have some "skin in the game." I'm not sure where in our culture or when in our culture it was decided that parents should pay for 100% of their child's education. We had him take out a loan the first year to complement the scholarships he had received and money he earned during the summer. We may (haven't decided yet) pay that loan off for him once he graduates.

User avatar
Tamarind
Posts: 1136
Joined: Mon Nov 02, 2015 2:38 pm

Re: How to get child's skin in the game for college?

Post by Tamarind » Fri Feb 16, 2018 8:38 am

My parents bribed me very effectively. They told me when I was a HS junior that they'd saved enough to cover the full cost of Local Public School and if I got scholarships or attended a cheaper school I could pocket the difference. If I spent in excess, it was my job to find that money. I finished with a $20k cushion which meant I was financially independent from the day I left school in 2008 and required no further inputs even though the job market was awful. It helped that I was a good student and not inclined to party, but I have always been grateful for their generous gift.

I would suggest you judge any potential plan with an eye to what will actually reduce your long term costs. For example, you may prefer to pay for school than to have your graduated child end up continuing to live with you because she cannot otherwise pay down her loans.

Also, a caution: All the "skin in the game" tips only work if the child knows what parents are and are not willing to do in advance. After she's been accepted is a little late because some of her choices are now constrained - ie she hasn't shopped for schools with the correct budget in mind. Telling her after she finishes her third year would be callous and counterproductive. Whatever you are willing and able to do, be upfront with her or it will both feel unfair and potentially lead to disruptions in her education that could delay or derail her getting a degree.

phitchow
Posts: 48
Joined: Wed Dec 31, 2008 10:04 pm

Re: How to get child's skin in the game for college?

Post by phitchow » Fri Feb 16, 2018 8:50 am

Your child borrows $20k in student loan. If the child graduates in 4 years, you pay off the loans.

Variations:
  • You pay off a percentage if the child graduates in 5 or 6 years.
  • Consider using the military to pay for education.

livesoft
Posts: 62294
Joined: Thu Mar 01, 2007 8:00 pm

Re: How to get child's skin in the game for college?

Post by livesoft » Fri Feb 16, 2018 9:10 am

I didn't read all the responses, but the original post has some things that I will point out:

1. There is no need to pay for the first 3 years of college and then stiff her for the 4th year. You will have trained her like a dog to expect full college expenses to be paid for 3 years in a row, so the 4th year will be the same. That training is doing both her and her parents a big disservice.

2. She can work starting now until she dies. That is, for the rest of her life. So she can get a job to pay for 25% or more of her freshman year expenses. She can start during her last semesters of high school and continue through the summer, and into her time in college.

3. So tell her that you are only paying 50% to 75% of her college expenses and that she has to get the rest. Show her how much she can earn at a job right now and through the summers and school years.

4. Use peer pressure. Many of her friends will have jobs. When they come over to the house or you go out with everybody, talk to those friends about their jobs, how they got them, how they like/hate them, and praise them for getting their act together.

5. When you are out shopping with your daughter, you will come across many people of her age working. Chat with those people in the presence of your daughter about how like like their job, how they got their job, and what their plans are for the future. I am talking with cashiers, saleclerks, receptionists, and many other young people who are working every week, so there are plenty of people to talk to.

6. Your daughter shouldn't have to get any loans at all, so discourage that route.
Wiki This signature message sponsored by sscritic: Learn to fish.

User avatar
gasdoc
Posts: 1515
Joined: Mon Nov 03, 2014 8:26 am

Re: How to get child's skin in the game for college?

Post by gasdoc » Fri Feb 16, 2018 9:18 am

Not to judge, but it seems that your plan encourages getting good grades without necessarily getting a useful education. (It would be nice to get both, but it is not a given.) We are paying for our daughter's first four years without qualification. Scholarships/choosing a less expensive school would result in having money to pay for grad school/professional school. We have stressed for years that once she is finished with school she is on her own financially, and her lifestyle will reflect her grades and choice of major. She gets it, and is appropriately concerned about grades. She chose a small private college, one with a good reputation, and one that gave better scholarship money. She chose a difficult major so that she will stand out when applying for job/graduate school positions.

gasdoc

barnaclebob
Posts: 2882
Joined: Thu Aug 09, 2012 10:54 am

Re: How to get child's skin in the game for college?

Post by barnaclebob » Fri Feb 16, 2018 9:28 am

Ditch the GPA requirement. I got around a 3.2 in my Engineering degree and am doing great. I would encourage you to encourage her to go into a real major that has actual job prospects without a masters. Don't fall for the "well this school is a top 5 basket weaving program so i'll be able to get a good job at basket weaving". They are all top of some list.

User avatar
gasdoc
Posts: 1515
Joined: Mon Nov 03, 2014 8:26 am

Re: How to get child's skin in the game for college?

Post by gasdoc » Fri Feb 16, 2018 9:36 am

barnaclebob wrote:
Fri Feb 16, 2018 9:28 am
Ditch the GPA requirement. I got around a 3.2 in my Engineering degree and am doing great. I would encourage you to encourage her to go into a real major that has actual job prospects without a masters. Don't fall for the "well this school is a top 5 basket weaving program so i'll be able to get a good job at basket weaving". They are all top of some list.
Good example of my post immediately preceding this one. I'd rather my daughter have a B average in a STEM field at an unknown college than many other degrees at better known schools with a higher GPA.

gasdoc

User avatar
sunny_socal
Posts: 1610
Joined: Tue Mar 24, 2015 4:22 pm

Re: How to get child's skin in the game for college?

Post by sunny_socal » Fri Feb 16, 2018 9:42 am

noco-hawkeye wrote:
Fri Feb 16, 2018 8:24 am
luckybamboo wrote:
Fri Feb 16, 2018 12:20 am
So the issues are
1. How can a child of high earning parent get a student loan if necessary?
2. How to hold child accountable for the grades / performance to justify the free ride for college?
Thanks
Some harsh advice / feedback:

1) . You should feel lucky you are a high earner. You want a loan in addition to being financially well off? I don't understand where you are coming from on this one.

2). You've had 17 years to form the child's values and get them ready for college. You need to let them sink or swim a bit now. Let's be honest - the money you have saved is going to pay for college expenses, if the GPA is a 3 or a 4. Let's not pretend otherwise - let the kid learn for herself.
Disagree with this line of thinking. "Lucky" high earners get punished in many different ways:
- Higher taxes
- AMT
- Many perks/deductions/credits phase out depending on income

High income tends to be punished, there are many incentives to remain as a mid to low income earner.

How would you like it if you went to an auto dealer and said "I'd like to buy that car you listed with the 0% deal!" Dealer replies "I see you're a high earner, you must pay 5%."

I'm going to have my kids work summer jobs and use that money toward their tuition.

Dottie57
Posts: 4276
Joined: Thu May 19, 2016 5:43 pm

Re: How to get child's skin in the game for college?

Post by Dottie57 » Fri Feb 16, 2018 9:51 am

msk wrote:
Fri Feb 16, 2018 2:04 am
I find all this skin in the game for college education rather sad. IF you can afford paying 100%. You were happy to support her 100% for the past 17 years; why baulk at the final year in college? At college it becomes clearer as to what turns her on, hopefully not drugs. She will pay full attention to those subjects... IF you can afford it, just pay. All IMHO of course.

PS I have paid 100% for all my 4 kids, even though I have been blessed with a bunch that each could easily have received full scholarships (top of their high school classes, etc.). I specifically dissuaded them from applying for scholarships so as not to deprive some other, financially challenged, kids. You can often "guarantee" loans for practically anyone. Just talk to your local bank manager. As far as I experienced it (for a construction contract), the process is straightforward. You deposit cash in a CD, say, $20k, maturing at the end of the loan period, i.e. the "guarantee" period. Your kid takes a $20k loan from the bank. She pays all the instalments as agreed between the bank and herself, you cash your CD. She lets her loan default, the bank cashes your CD and recovers their outstandings.

+1

My parents paid full bill for college. I am eternally grateful for a clean start with no debt.

User avatar
teen persuasion
Posts: 580
Joined: Sun Oct 25, 2015 1:43 pm

Re: How to get child's skin in the game for college?

Post by teen persuasion » Fri Feb 16, 2018 9:54 am

Pace yourselves, and help your student to learn to pace herself.

Don't pay for 3 years at 100%, and then 0% for the 4th year. Instead let your student know you will pay 75% of college expenses for 4 years. Your student needs to cover the other 25% (plus their personal expenses) - she can hustle and find scholarships, paying jobs, and loans as she is motivated. Loans are easy, but have a cost at the end of school - make sure she knows the expected monthly cost of each incremental loan, and how long she'll be making payments, to make it a less attractive option.

Adjusting to college is a process, and students keep maturing through college. I had a scholarship for tuition, but took loans for R & B initially. After a few years, I found a grant job on campus and quickly learned how easy it was to get other part time gigs from that exposure. I'd initially thought only work study students could get on campus jobs, and I wasn't eligible for work study, but once "inside" I learned there were many budget lines willing to hire openly. I realized loans were unnecessary, I could support myself on those on campus jobs.

I understand the desire to have a student not work so that they focus on classes and grades, but I found working was an important part of my education. It forced me to use my time well (because it was limited), gave me real job experience (classes felt very theoretical), and gave me experience with the intangible working soft skills (getting along with coworkers, how to delegate, showing up on time, meeting deadlines, bureaucracy, networking, reaching a consensus, etc.). The variety of gigs gave me a broader set of skills: math tutor, desktop publisher for a writing group, testing incoming students for placement, developing SW for the testing department. Even the less desirable jobs are useful, if only to teach you that you DON'T want to have to work jobs like them in the future post college (graveyard shift desk duty).

If a career is the ultimate reason for a college degree, working during college could be a positive experience, not a distraction. Might make sense to wait until an immature student has settled into college well before adding a job, or begin with jobs only during summer break (when they can work full time for essentially 4 months).

Dottie57
Posts: 4276
Joined: Thu May 19, 2016 5:43 pm

Re: How to get child's skin in the game for college?

Post by Dottie57 » Fri Feb 16, 2018 9:56 am

Bacchus01 wrote:
Fri Feb 16, 2018 7:39 am
msk wrote:
Fri Feb 16, 2018 2:04 am
I find all this skin in the game for college education rather sad. IF you can afford paying 100%. You were happy to support her 100% for the past 17 years; why baulk at the final year in college? At college it becomes clearer as to what turns her on, hopefully not drugs. She will pay full attention to those subjects... IF you can afford it, just pay. All IMHO of course.

PS I have paid 100% for all my 4 kids, even though I have been blessed with a bunch that each could easily have received full scholarships (top of their high school classes, etc.). I specifically dissuaded them from applying for scholarships so as not to deprive some other, financially challenged, kids. You can often "guarantee" loans for practically anyone. Just talk to your local bank manager. As far as I experienced it (for a construction contract), the process is straightforward. You deposit cash in a CD, say, $20k, maturing at the end of the loan period, i.e. the "guarantee" period. Your kid takes a $20k loan from the bank. She pays all the instalments as agreed between the bank and herself, you cash your CD. She lets her loan default, the bank cashes your CD and recovers their outstandings.

I find it rather sad that people put other people down for simply wanting to share some responsibility with their ADULT child.

Many 18 yearolds are far from being adults. And brains don't mature until ages 24-26.

Khanmots
Posts: 1233
Joined: Sat Jun 11, 2011 2:27 pm

Re: How to get child's skin in the game for college?

Post by Khanmots » Fri Feb 16, 2018 10:00 am

Not sure I have any actionable advice, but I think there's some lessons to be learned from my experiences as the kid going through college.

Approach my parents took was that if I'd contribute my scholarships and what I earned from working towards school, and room and board expenses. They'd cover what was left.

Worked out well from a financial aspect; the first 3 years they covered roughly $1000 a year (scholarships helped a lot, and I attended a good state uni). Didn't work out so well from a me getting an education aspect. I wound up flunking out for various reasons, primarily due to burning myself out on the wrong-for-me major. Looking back, some of my mistakes the first go-round were trying to work while I was in school combined with trying to push myself too hard to finish what's really a 5-yr degree in 4 (chemical engineering). Combined with a major that the further I got the more I dreaded... I should have switched schools (almost impossible to change engineering majors at the first one) and majors after the first 1-2 years, but tried to push through.

Anyways, my parents stuck with me, let me move in, and helped pull me out of my depression (I was a wreck and had given up on doing anything with my life as I was provably a failure and the only future I could see was to work dead-end jobs to barely get by). They convinced me to apply for the local uni, move back in with them to save money, and continued to cover the costs I couldn't despite the loss of my scholarships and me cutting back how much I worked (pretty much to summers only). After switching majors into the correct-for-me one, (and making sure I didn't overload myself again), I graduated 4 years later cum laude with an comp sci engineering degree and am now 10-15 years into a successful career where I enjoy what I do.

LiterallyIronic
Posts: 764
Joined: Sat Dec 05, 2015 10:36 am

Re: How to get child's skin in the game for college?

Post by LiterallyIronic » Fri Feb 16, 2018 10:05 am

The way my parents did it was they paid my rent until I either finished school or got married, whichever came first. I paid my own tuition. If I paid for my own classes, then I was throwing my own money away if I skipped or whatever. And if I flunked out, then I wasted my own money on tuition and would no longer be getting the free apartment rent from my parents.

I'll probably try to do the same thing with our kid - 17 years from now.

Grt2bOutdoors
Posts: 19075
Joined: Thu Apr 05, 2007 8:20 pm
Location: New York

Re: How to get child's skin in the game for college?

Post by Grt2bOutdoors » Fri Feb 16, 2018 10:09 am

sunny_socal wrote:
Fri Feb 16, 2018 9:42 am


I'm going to have my kids work summer jobs and use that money toward their tuition.
Your kids are either going to be paid well above average over the course of the next ten summers or chances are they are going to fall far short of being able to pay for 1 years tuition (possibly room and board if there are no local accessible colleges within reasonable public transit or driving options).

As for AMT, that excuse goes out the window this year and for the next 7 years, those paying AMT will be a very slim percentage of the overall population, very slim indeed.

Those in the middle and lower economic strata also have financial penalties, they are required to pay a substantial portion of their income (view FAFSA) and many of them have little to nothing in the way of assets meaning the fallback is scholarships, grants, loans and/or use of an inexpensive educational institution.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

Grt2bOutdoors
Posts: 19075
Joined: Thu Apr 05, 2007 8:20 pm
Location: New York

Re: How to get child's skin in the game for college?

Post by Grt2bOutdoors » Fri Feb 16, 2018 10:10 am

Dottie57 wrote:
Fri Feb 16, 2018 9:56 am
Bacchus01 wrote:
Fri Feb 16, 2018 7:39 am
msk wrote:
Fri Feb 16, 2018 2:04 am
I find all this skin in the game for college education rather sad. IF you can afford paying 100%. You were happy to support her 100% for the past 17 years; why baulk at the final year in college? At college it becomes clearer as to what turns her on, hopefully not drugs. She will pay full attention to those subjects... IF you can afford it, just pay. All IMHO of course.

PS I have paid 100% for all my 4 kids, even though I have been blessed with a bunch that each could easily have received full scholarships (top of their high school classes, etc.). I specifically dissuaded them from applying for scholarships so as not to deprive some other, financially challenged, kids. You can often "guarantee" loans for practically anyone. Just talk to your local bank manager. As far as I experienced it (for a construction contract), the process is straightforward. You deposit cash in a CD, say, $20k, maturing at the end of the loan period, i.e. the "guarantee" period. Your kid takes a $20k loan from the bank. She pays all the instalments as agreed between the bank and herself, you cash your CD. She lets her loan default, the bank cashes your CD and recovers their outstandings.

I find it rather sad that people put other people down for simply wanting to share some responsibility with their ADULT child.

Many 18 yearolds are far from being adults. And brains don't mature until ages 24-26.
Sometimes they never mature.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

randomguy
Posts: 6171
Joined: Wed Sep 17, 2014 9:00 am

Re: How to get child's skin in the game for college?

Post by randomguy » Fri Feb 16, 2018 10:13 am

sunny_socal wrote:
Fri Feb 16, 2018 9:42 am


Disagree with this line of thinking. "Lucky" high earners get punished in many different ways:
- Higher taxes
- AMT
- Many perks/deductions/credits phase out depending on income

High income tends to be punished, there are many incentives to remain as a mid to low income earner.

How would you like it if you went to an auto dealer and said "I'd like to buy that car you listed with the 0% deal!" Dealer replies "I see you're a high earner, you must pay 5%."

I'm going to have my kids work summer jobs and use that money toward their tuition.
You have an odd definition of punishment. Ask anyone if they would rather make 100k with none of your punishments or 500k and all those punishments and I think you will find that we are a nation of masochists.:) We are also a nation full of people trying to figure out how they are getting victimized:)

The college student has skin in the game. It is their future on the line. Compared to that a couple of thousand bucks just doesn't matter. Pretty much every incentive attempt has pluses or minuses. Require a 3.2 GPA? Do you really want to encourage getting say an english degree versus electric engineering? Require them to work? Does making 5k make up for having to skip out on some internship that only paid 1k? And so on.

People will list their approach but I have a feeling it makes little to no difference either way.

Khanmots
Posts: 1233
Joined: Sat Jun 11, 2011 2:27 pm

Re: How to get child's skin in the game for college?

Post by Khanmots » Fri Feb 16, 2018 10:19 am

randomguy wrote:
Fri Feb 16, 2018 10:13 am
The college student has skin in the game. It is their future on the line. Compared to that a couple of thousand bucks just doesn't matter. Pretty much every incentive attempt has pluses or minuses. Require a 3.2 GPA? Do you really want to encourage getting say an english degree versus electric engineering? Require them to work? Does making 5k make up for having to skip out on some internship that only paid 1k? And so on.
I already posted my story in this thread, but I will note that when I was flunking out that what had me depressed and stressed as anything had nothing to do with the money I'd put in. It had everything to do with not wanting to disappoint my parents, and being convinced that I'd wind up with a crappy job I hated for the rest of my life. The fact that I'd thrown away most every dime I'd earned over the previous 3 years wasn't something I even thought about... the fact that I'd thrown away some of my parents money hurt far more.

getthatmarshmallow
Posts: 205
Joined: Mon Dec 04, 2017 9:43 am

Re: How to get child's skin in the game for college?

Post by getthatmarshmallow » Fri Feb 16, 2018 10:23 am

NO NO NO NO NO NO NO NO to the idea of tying whether you pay for college to a GPA. As a college prof that strikes me as a way to ensure your kid has a nervous breakdown in my office sometime in her junior year when she comes across a hard class and realizes that a B instead of a B+ means $100K in debt. Plus side, it would give her a nice story for her eventual memoir of iGen despair. Or she picks a major that's easier because you've structured the incentives such that if she tries and fails you hand her a ton of debt. (My aerospace friends used to joke that a 3.0 was like a 4.0.)

Double no to "we'll pay for three, you pay for the last one." Look, the college degree doesn't mean much unless it's finished (quite a lot of the student loan mess is people taking out loans who never finish.) Suddenly inflating costs in the last year of school isn't going to teach her to have skin in the game. It's going to ensure that she takes a longer time to finish, racks up more debt in the last year, or gives up internships/opportunities in her last year to work part-time jobs.

Some options that might work better: you pay tuition/fees/board, she's responsible for all extra. No fun money that she doesn't earn. She takes out the max in Stafford loans per year. That's significant but not life-changing amounts of debt, and you can always surprise her at graduation by wiping out the loans if you're so inclined.

Or, you just tell her that you value education, and you'll pay what you can, and here's what you can, and let her decide how she wants to proceed. That would be my preference, and probably a better introduction to adulthood than a plan to saddle her with lots of debt unless she meets an arbitrary incentive.

Leemiller
Posts: 1039
Joined: Sat Jun 01, 2013 12:42 pm

Re: How to get child's skin in the game for college?

Post by Leemiller » Fri Feb 16, 2018 10:32 am

I think parents who tell their children to just take out student loans do them a huge disservice. If you’re balking at the price, and college is expensive, have your kid go to community college the first two years and then transfer. Maybe require a job or internship during the school year and summer. I have never seen a good result from having student loans. I also think pushing or encouraging a 17 year old kid into a college that they need loans for vs starting out at community college is just wrong. Let’s not pretend debt builds moral character, then you wonder why your kids buys a new car on payments.....

User avatar
climber2020
Posts: 1084
Joined: Sun Mar 25, 2012 8:06 pm

Re: How to get child's skin in the game for college?

Post by climber2020 » Fri Feb 16, 2018 10:47 am

celia wrote:
Fri Feb 16, 2018 2:57 am
By requiring her to have a certain GPA, the easiest way for her to do that is to take easy classes, those that don't lead to a career. Is that what you want to encourage?
I agree with the general sentiment, but this isn't always the case, especially if graduate school is a possibility.

My goal from day one of college was to get into a good medical school. The most efficient way to do this is to get straight As and score well on the standardized entrance test. My approach was to take the easiest possible pre-requisite courses with the most lenient professors. I got As in all of these classes. Several of my friends took much harder science courses and subsequently didn't do as well. They had a more difficult time getting interviews than I did. No one cared that they took advanced physical chemistry; it's the grade that mattered. In the end, those difficult courses they took gave them no advantage whatsoever since it's mostly useless information that no doctor ever uses in the real world.

User avatar
DaftInvestor
Posts: 4018
Joined: Wed Feb 19, 2014 10:11 am

Re: How to get child's skin in the game for college?

Post by DaftInvestor » Fri Feb 16, 2018 10:57 am

I also don't believe the "Skin in the game" philosophy. My kids work hard and I am happily funding 100% of their education. I let them keep their job money for spending money (of course one works 16 hours weekly in a "Non-Paid" internship in addition to full-time school so no time for job).
I graduated college with a lot in student loans but they were ALL subsidized as my parents had no money. As a higher earner I just can't see forcing my kids to pay high interest rates and bury themselves in debt before they even start off in life when I can help them. Saving for college along with saving for retirement were always my spouse and I's goals - we were always on the same page here. Sounds like your philosophy differs (you/your-husband feel them paying a lot of interest in loans before they start out in life will somehow make them feel more responsible - I believe this is a false assumption).

To answer your questions:
luckybamboo wrote:
Fri Feb 16, 2018 12:20 am
So the issues are
1. How can a child of high earning parent get a student loan if necessary?
2. How to hold child accountable for the grades / performance to justify the free ride for college?
Thanks
1) Unless your child has the money to pay off the loan you are going to have to co-sign for it. So their "Skin in the game" could become your skin anyway.
2) They need to be self-motivated and self-accountable. If they aren't - then perhaps they shouldn't go to college. Strapping them with loans won't necessarily make this happen (they may still get bad grades and then default on a bunch of loans on top of that - if they are irresponsible they will likely be irresponsible with both their grades and their debt).

cheapskate
Posts: 745
Joined: Thu Apr 26, 2007 1:05 pm

Re: How to get child's skin in the game for college?

Post by cheapskate » Fri Feb 16, 2018 11:01 am

For most of us, college is a bridge to a job. She has yet to start college and you have 3+ years of college expenses saved up.

Can you tell her she needs to work part time during school (and all summer) during all 4 years of college to support herself during her 4th year of college, and save up that money and use that for her 4th year ? I am a big proponent of working part time during college - it teaches students many life skills (time management, being able to juggle work/studies, not load them with free time that they might waste elsewhere, get into the workforce and start experiencing work life - even though college jobs are going to be different than post college jobs, allow them to put some work experience on the resume when they look for a job post graduation, show them the value of money etc).

Hulu
Posts: 132
Joined: Wed Oct 22, 2014 7:55 pm

Re: How to get child's skin in the game for college?

Post by Hulu » Fri Feb 16, 2018 11:03 am

Agree with others that stated it's highly personal. If your daughter loves you/herself, appreciates you/money and is driven to succeed then you so what my parents did with my sister. Which was steer her towards a good school with lower cost and have her work. Or if you're hands off what they did with me. Which was give me a credit card and pay for any school. If your daughter is like my brother then don't pay for anything until they've proven themselves serious.

I'd also suggest aiming slightly on the trusting/aspiring side. It's nice as a kid that your parents believe in you. I'll never forget my mom when she bought me a laptop saying, "We wanted to buy you this because we believe in you"

User avatar
Pajamas
Posts: 6015
Joined: Sun Jun 03, 2012 6:32 pm

Re: How to get child's skin in the game for college?

Post by Pajamas » Fri Feb 16, 2018 11:04 am

You said it is your husband that only wants to pay for three years and have her come up the means to pay for the fourth year. What are your thoughts on this? I am not sure that is a good way to ensure that she devotes herself to her studies in the first three years or even in the fourth year. I am also not sure that she should even attend university at this time if it is necessary to police her behavior in the first place.

It seems to boil down to a mismatch in the past between your expectations for her behavior and her actual behavior and now that you are going to have to pay for her education, her past behavior will no longer be acceptable. The best predictor of future behavior is past behavior. That's why universities look at grades and accomplishments in high school and are putting less emphasis on admission test scores. I'm sure you also want your daughter to do well in life and she is entering that period in which you have to let her find her own way and give assistance and advice only when it is requested or needed badly.

It sounds like there has been some reluctance on her part to do what is necessary to be fully successful in school but you haven't said anything about why that might be or what motivates her. I think you and/or your spouse and your daughter should sit down and have a long talk about college and what her goals and plans are and what your expectations are and how you feel about her past behavior and attitudes about school. It might be best for you to talk to her one-on-one first since you are asking for help here.

If you have already done this and still feel the need to shape her behavior in school, then maybe she is not ready to attend a university and should do something else for a while instead, whether it is attend a community college or work or something else. The university may grant a one year deferment on admission upon request. Check and see if that is a possibility. If nothing else, she could earn some money to help pay for school and maybe learn something about the importance of education. It would give her a year to mature and improve her ability to focus.

zuzimb
Posts: 59
Joined: Fri Aug 14, 2015 10:21 am

Re: How to get child's skin in the game for college?

Post by zuzimb » Fri Feb 16, 2018 11:10 am

I haven't read all the replies, but here's what my parents did for me. As I don't have children I can't comment one what I think should be done.

I was always a slacker in highschool, didn't do much of the work so grades weren't as great as they could have been. Understandably my parents didn't want to fund an education that I was going to flunk out of or get nothing out of.

From the outset (about a year or so from the start of college) my parents told me exactly how much money they would supply for college (2 years of public university), the choice of college was mine but I had to make up the difference. If I took extra time in college I had to make up the extra. The caveat was that I had to pay for the first semester of college by myself, and get a required GPA. They didn't tell me what the GPA level requirement was, so I got the best grades I could, which ended up putting me on a solid foundation for the rest of college.

The rest of the money was made up from working in the summers and graduating a year early. Left school with no debt and a little money in an IRA and savings, thankful for all of my parents assistance.


One thing to note is that my parents knew I had the cash available to pay for the semester upfront, and they enabled me to save from very early on in life. They did everything they could to encourage saving, and not touching money once saved. Their method worked for me, but it might not work for everyone. Hope this helps with your decision.

Post Reply