OT: Looking at College Financial Aid Calculations. How close are they?

These days more and more colleges are not allowing credit for AP classes. As my son's college put it, "we want our students to take our version of the classes, not some generic version". It doesn't hurt to take AP classes, just don't expect to get credit for them from a college.

And many of them are still accepting AP scores for credit. My son applied to 5 colleges and universities here in New England (and one in PA). Every single one of them will give him credit for the three exams he took last year, and if he does as well this year, he should get credit for two more (he is NOT too confident about the Physics exam).
 
.....Having sent 3 off to college (the last one graduates in just a little over a month!), I cannot tell you how helpful it was to follow that advice from the time that the kids were little. It isn't something that you intuitively know.....

I hope this doesn't come off as holier than thou, but as the parent of two teens, I'm not sure how people missed this raising kids. The rapidly rising cost of college has been a thing since I was in college - and I'm 50. The disappearance of financial aid. The debates on 529s, prepaid college plans, and the best way to pay for college for the middle class. I haven't been able to pick up a copy of Money or Kiplingers, or log into my bank's website, listen to presidential debates, talk to parents of high schoolers, or take a call from the college alumni organization without "planning for paying for college" being a thing for my entire adult life. To me, it may not have been intuitive, but there was certainly no lack of advice.
 
I hope this doesn't come off as holier than thou, but as the parent of two teens, I'm not sure how people missed this raising kids. The rapidly rising cost of college has been a thing since I was in college - and I'm 50. The disappearance of financial aid. The debates on 529s, prepaid college plans, and the best way to pay for college for the middle class. I haven't been able to pick up a copy of Money or Kiplingers, or log into my bank's website, listen to presidential debates, talk to parents of high schoolers, or take a call from the college alumni organization without "planning for paying for college" being a thing for my entire adult life. To me, it may not have been intuitive, but there was certainly no lack of advice.
Most people are living way above their means. They are not saving for their own retirement or even an emergency fund and they are struggling to pay off debt.

Sure, they should be aware that they need to save for their kids to attend college (there is info out there like you mentioned), but I think many people are either in denial about the reality of the cost because they are so focused on the present or they are really just oblivious and not aware unless someone addresses the issue with them directly (like other posters have mentioned).

If you feel like it's impossible for you to save for your kids' education, you're more likely to assume "I managed, so I'm sure they will too" and close your eyes to any information telling you otherwise.
 
Not everyone who failed to have a big savings for their children's college is/was irresponsible. Sometimes circumstances beyond your control happen, and there is no $$ to put away, for college, retirement, entertainment,new car or home etc. No vacation since 2006, and before that it was 1999. Do I wish we could have saved more for our kids-of course we do. Do I wish we didn't have major job loss ( with all retirement gone) due to employers going bankrupt twice throughout our married lives and having to choose job security with insurance over a better salary or major diseases to deal with physically, financially and emotionally-of course not, but that's what life brought us, and my husband and I raised 2 kind, caring, smart and dedicated young women who have tried hard to better themselves. If that means them taking out federal loans, along with the grants, scholarships and campus jobs they have, and they know what that entails then so be it. They don't expect a handout, and neither do we, but when college costs grow at double the inflation rate or more, every little bit of help is appreciated.
Oldest DD graduated college in 2013, and although she can't afford to go to grad school now or move to where jobs are, she took a full time job not in her field at a very low salary because it's all there is here right now and she wanted to start paying off her loans and put some $$ away to be able to move to follow her dreams. She could have done what many kids do, and not pay on the loans or get deeper into debt, but that's not her. Federal loans may not be an ideal way partially finance going to college, but in too many cases it's the only way you can afford to get your degree so you get that career you want.
 


Not everyone who failed to have a big savings for their children's college is/was irresponsible....

I get that. There is a huge difference between "my husband got laid off, I got laid off, we got caught in the housing bubble during the layoff and lost our house, I had a car accident and ended up on disability for two years - and any savings we did have we spent in crisis" and "I didn't know" with a dozen trips in your signature line. Or sending your kids to a Cal State school instate tuition or two years worth of community college and saying "its a stretch and I wish there was more aid" than saving nothing and complaining that American University in DC is too expensive and there isn't sufficient aid.

I really wish there was more aid and more options for the people who got unlucky or who are middle class only because they are breaking their nails clawing to be and stay there and have reasonable expectations. I can't get my head around people who chose vacations and new cars over saving or who chose to have one parent stay home and now are wondering who will pay for their kid to go to a small liberal arts college, out of state school, or the state flagship. Maybe its my neighborhood - where half the kids are on free/reduced lunch but 10% drive to school in their shiny new birthday presents and I get to hear both perspectives. One I truly feel for. The other I smile and nod and then roll my eyes the moment I can get away.
 
Most people are living way above their means. They are not saving for their own retirement or even an emergency fund and they are struggling to pay off debt.

Sure, they should be aware that they need to save for their kids to attend college (there is info out there like you mentioned), but I think many people are either in denial about the reality of the cost because they are so focused on the present or they are really just oblivious and not aware unless someone addresses the issue with them directly (like other posters have mentioned).

If you feel like it's impossible for you to save for your kids' education, you're more likely to assume "I managed, so I'm sure they will too" and close your eyes to any information telling you otherwise.
Or it may be once the mortgage and bills were paid, there was nothing left. Not everyone who can't afford the outrageous cost of college was living beyond their means.
 
And many of them are still accepting AP scores for credit. My son applied to 5 colleges and universities here in New England (and one in PA). Every single one of them will give him credit for the three exams he took last year, and if he does as well this year, he should get credit for two more (he is NOT too confident about the Physics exam).

Taking AP classes never hurts, even if you don't get college credit. But the trend is away from giving credit.
 


If you have your kids straight out of high school - and are still in your 30s when they start college - that decision to have your kids early will cost you.
.

:rotfl2::rotfl2::rotfl2:Ok, I have to laugh at this one. Dh and I had 2 kids by 21 and before graduating with our own degrees. Our income is finally at a level where with their meager 529 plans, we would have no problem cash flowing a state school. AND then BOOM came number 4 who now has a $16k/year daycare bill.

(And just so no one thinks I'm whining- we'll figure it out and I'm not expecting "the government" to cover my kids tuition due to my choices.)
 
:rotfl2::rotfl2::rotfl2:Ok, I have to laugh at this one. Dh and I had 2 kids by 21 and before graduating with our own degrees. Our income is finally at a level where with their meager 529 plans, we would have no problem cash flowing a state school. AND then BOOM came number 4 who now has a $16k/year daycare bill.

(And just so no one thinks I'm whining- we'll figure it out and I'm not expecting "the government" to cover my kids tuition due to my choices.)

Having your kids early is awesome in a lot of ways, but it doesn't USUALLY position you well for being able to live comfortably below your means while saving for college. As you said, its a choice. Mine were late, and I probably won't get to go to grandchildren's weddings. And congrats on your "surprise" - as much as that impacts the older one's ability to get through college without debt, I'm sure you wouldn't trade your surprise.
 
Look for schools where your child's grades & SAT/ACT scores are much higher than what they are looking for. DS receives about $25K a year in aid - $20K in Merit & $5 need based from a nice school in DC, just not as high a ranked school as he could have gotten into. He knows he has to keep up a certain average, or the Merit Aid stops & he has to come home to the local Community College. We are hoping DD takes the same route as her grades are better & ACT score is nicer than his was.
 
I hope this doesn't come off as holier than thou, but as the parent of two teens, I'm not sure how people missed this raising kids. The rapidly rising cost of college has been a thing since I was in college - and I'm 50. The disappearance of financial aid. The debates on 529s, prepaid college plans, and the best way to pay for college for the middle class. I haven't been able to pick up a copy of Money or Kiplingers, or log into my bank's website, listen to presidential debates, talk to parents of high schoolers, or take a call from the college alumni organization without "planning for paying for college" being a thing for my entire adult life. To me, it may not have been intuitive, but there was certainly no lack of advice.

I don't think it is as much a case of missing it as it is not feeling like the advice applies to your situation. Most of the college savings advice I've seen is rooted in an assumption of relative affluence, ie that saving a few hundred dollars a month per child is a fairly simple matter for anyone who has the will. Most Americans don't have a few hundred dollars per child left over after making ends meet (keeping in mind that the median American income is about $50K, and if you start saving at birth you need to be putting away about $5500/year per child to fully cover the projected costs of a state college), and I'm not sure it is reasonable to condemn everyone who wanted a home in a good neighborhood or a decent car or a vacation or more than a minimal maternity leave or other extras at some point during the years spent raising their kids and saving for college. Living without any extras for 18+ years is a pretty difficult thing to do.
 
Well said Colleen. in our case, we have three kids. In order for us to have completely covered fours years tuition at a State University, we would have had to have saved $300,000 over the past 18 years. That is about $1400 a month for 18 straight years! Tell me that is realistic for the average American? And...that would be even more for Private Colleges. The prices are insane. My DD has gotten some great scholarship offers. But...the prices are still $25-30,000 a year...after the scholarships.

It is possible, however, to get a college degree and not have to finance your or your kids future. I think people have lost fact of that. The majority of people I know think every kids HAS to live away at school...which is crazy. No kid HAS to...the experience may be great, but paying off student loans for the next 20 years to do so is something more people really need to take into consideration. I think we are seeing this student loan crisis because parents and kids just took loans "because it's what you do" without really thinking about the long term ramifications of doing so.
 
It is possible, however, to get a college degree and not have to finance your or your kids future. I think people have lost fact of that. The majority of people I know think every kids HAS to live away at school...which is crazy. No kid HAS to...the experience may be great, but paying off student loans for the next 20 years to do so is something more people really need to take into consideration. I think we are seeing this student loan crisis because parents and kids just took loans "because it's what you do" without really thinking about the long term ramifications of doing so.

I think there's definitely some of that. I have classmates who complain about their student loans but live in the dorms even though their parents are 5-10 minutes away. But there's also a lot of America that isn't within commuting distance of a four-year college so there certainly are kids who can't live at home to save money.

I don't want my kids commuting to university from where we live - it is just at the outside edge of reasonable (~100 miles r/t) and I'm doing it, but it makes a lot of things more difficult than they would be for a student who lives on or near campus. I don't think the dorm experience is worth borrowing for, but not spending 3 hours a day in the car and trying to pack your classes into as few days on campus as possible... That is worth something. We will probably relocate before our youngest starts high school and the area I have in mind if we stay in Michigan is with a short distance of a couple of good colleges so maybe commuting will be an option for her at least.
 
You don't have to have all the money saved BEFORE your children start college, and certainly not from birth. We had some saved, but most of it was cash flow. We paid off the mortgage on our "live beneath our means" home, freed up cash each month. No more kids at home, freed up cash. I went from part time to full time work, added cash. Less vacations as the kids were working summers in high school, added cash. The kids were working during the summers, added cash. Tax credits, saved money, added cash.

We did the same thing saving for college. The kids went to part time private preschool when they were 3 and 4 so when they stopped going, that money was saved. Same thing when other educational expenses like music lessons or sports went away, added savings. I went from SAHM to working part time when they entered school, a lot of that money was saved for college. Specifically avoiding some purchases because we forced ourselves to think about what was the best use for that money for us (and the kids) in the long run, added savings.

Many people simply don't have the means, I get that. There are programs that can help with that when your FAFSA EFC is low. However, when you are talking about people making enough money that FAFSA EFC expects them to cough up a bunch of money, that's not the demographic we're talking about. When I hear people making a lot more money than my family does talking about all the loans their kids are accumulating with college, I cringe. We were diehard I guess. We told our kids what we could afford to help them with, what we expected them to contribute by working, and that we would stop support if they took out more than the basic student loans. That gave them a maximum number and they chose schools accordingly. The FAFSA EFC is scary, but it EXPECTS some sacrifice on the part of parents and students. And yes, part of that sacrifice might be the yearly Disney trip.
 
Sure, they should be aware that they need to save for their kids to attend college (there is info out there like you mentioned), but I think many people are either in denial about the reality of the cost because they are so focused on the present or they are really just oblivious and not aware unless someone addresses the issue with them directly (like other posters have mentioned).
Yep, I agree with the denial of reality idea. I can see how it happens: People say, "I can't save now because of day care, but once that's done I'll save that, and we'll be ready for college." Anyway, they're still paying off their own student loans. But then they realize that after school care costs half of day care, and anyway it's time to move to a larger house, and they'll save once the promotion comes through. But they really want to have certain experiences -- like Disney -- with the kids before they grow up, and if it has to go on the credit card, so be it. Then suddenly the kids are teens, and it's time for braces and car insurance and prom dresses, and suddenly ... where did the time go?

Add to that the idea that since there's nothing "left over" at the end of the month, for sure financial aid will come through!

Denial. Focusing on the present
Maybe its my neighborhood - where half the kids are on free/reduced lunch but 10% drive to school in their shiny new birthday presents and I get to hear both perspectives. One I truly feel for. The other I smile and nod and then roll my eyes the moment I can get away.
Nope, not just your neighborhood. I see lots of it at school.
I don't think it is as much a case of missing it as it is not feeling like the advice applies to your situation. Most of the college savings advice I've seen is rooted in an assumption of relative affluence, ie that saving a few hundred dollars a month per child is a fairly simple matter for anyone who has the will. Most Americans don't have a few hundred dollars per child left over after making ends meet (keeping in mind that the median American income is about $50K, and if you start saving at birth you need to be putting away about $5500/year per child to fully cover the projected costs of a state college), and I'm not sure it is reasonable to condemn everyone who wanted a home in a good neighborhood or a decent car or a vacation or more than a minimal maternity leave or other extras at some point during the years spent raising their kids and saving for college. Living without any extras for 18+ years is a pretty difficult thing to do.
I'm middle-middle America and saved for college with minimal sacrifice. How? I live in a "good neighborhood" but in a house that isn't particularly cutting edge -- it's an all-brick ranch on a large lot. I bought my car new -- 8 years ago. A few choices like this can make the difference between being able to pay for college and taking out loans. I saw something recently about how much the average American spends on fast food breakfast and lunches -- I can't remember the exact number, but HALF of it X 18 years would pay for a kid's college education -- without the magic of compound interest.

And don't assume that college HAS TO cost so very much! At sticker price, my daughter's state school would be less than 50K for four years. So a middle class family who'd managed to put away 40K over 18 years would be able to pull 10K/year from savings and manage the rest through current income. Not impossible at all.
 
Sadly, the school is not realistic and do not take into account your rent/mortgage or any other debts you may have.

I don't think it would be fair to take your rent/mortgage into consideration. Family A buys a home well below what they can afford in order to save money for education, while family B buys a McMansion. Should family B get financial aid because of that?
 
my nugget of advice is NOT to co-sign any loans for your kids. YOU become responsible for that debt the moment you put your name on the paper.

Kids can only borrow $5500/year for Freshman & Sophomore years (or $6500 if parents income is very low), so it's usually not optional for your name not to be on the loans.
 
Well said Colleen. in our case, we have three kids. In order for us to have completely covered fours years tuition at a State University, we would have had to have saved $300,000 over the past 18 years. That is about $1400 a month for 18 straight years! Tell me that is realistic for the average American? And...that would be even more for Private Colleges. The prices are insane. My DD has gotten some great scholarship offers. But...the prices are still $25-30,000 a year...after the scholarships.

You wouldn't have had to save $1400/month to reach that savings goal....your figures assume no interest or compounding. Even using simple math and straight annual interest of only 3% you could save almost $60,000 in 18 years by putting away $200/month. Now granted, that may still be tough for a young family, but the value grows much larger than most think thanks to compounding.

Kids can only borrow $5500/year for Freshman & Sophomore years (or $6500 if parents income is very low), so it's usually not optional for your name not to be on the loans.

Those limits are only for Federal Stafford Loans. Every student can go out into the private market and apply for private loans which may need cosigners. THAT is how students end up with six figured debt loads.
 
Kids can only borrow $5500/year for Freshman & Sophomore years (or $6500 if parents income is very low), so it's usually not optional for your name not to be on the loans.
You're talking about Federal Stafford student loans (both subsidized and unsubsidized), which do not require a parents' signature.

I'm talking about private student loans and PLUS loans, which many families resort to in order to fill the financial gap. And yes, there are some private loans which can be gotten without a cosigner but they have stricter repayment terms and higher interest rates.
 
It is possible, however, to get a college degree and not have to finance your or your kids future. I think people have lost fact of that. The majority of people I know think every kids HAS to live away at school...which is crazy. No kid HAS to...the experience may be great, but paying off student loans for the next 20 years to do so is something more people really need to take into consideration. I think we are seeing this student loan crisis because parents and kids just took loans "because it's what you do" without really thinking about the long term ramifications of doing so.
I shake my head a lot over the number of my son's friends who went away to college for the "experience" and are now back living in their parents' homes because their student loan debt is so burdensome that they cannot afford to move out. Most of them cannot take a job in their field elsewhere because an entry level position won't pay them enough to cover living expenses and those loans. So these young adults are passing up great career opportunities because they cannot afford to go where the job is.
 

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