I don't think there is anything wrong with saying "I will pay for a State school and if you want to go out of state or private, you are responsible for the difference." You aren't saying you can't go. You aren't saying "I am unwilling to pay for your education." You are giving them the option of the decision and using cost as a factor. I can get around in a Chevy but I may want a Mercedes. I have to decide if the Mercedes is worth the sacrafice, but at the end of the day, I am still getting to and from work. For some, the Mercedes is worth it, for others it isn't.
That's a good analogy, but take it a step farther: Is it better for a young adult on an entry-level salary to have that Chevy debt-free . . . or to make payments on the Mercedes? We as adults know that having the Mercedes may be awfully sweet, but it may also mean going back home to live with Mom & Dad, it may mean delaying retirement savings. Is it really all that great a thing in the long run?
And throw in that the student must choose whether to get the Chevy or the Mercedes at 17-18 years old. The Mercedes may be quite enticing, but it's a parent's job to let the student know the true, full implications of both decisions -- and to throw in the option of driving a Jeep. Teens aren't experienced in making these big decisions, so they need help and guidance!
I agree a free college education is a generous thing. I think where you and I and I guess many others disagree is I don't think it is a good idea to burden a young adult with all those loans. I think it is more practical to say, "We can pay for a state school. If you can go to a private for around the same cost, great. However, we will not be cosigning any loans for you."
This is very similar to our opinion, though in my experience few students get the private-is-less-expensive offers, and those students who do tend to also get offers from the state schools too.
The wisest choice of action is to investigate all avenues available to your student, and see what he personally is offered. But while you're searching, keep the student well grounded in the idea that "These couple schools are the most likely possibilities -- these are the ones we can afford without help. Maybe the others'll work out, maybe they won't, but for sure we have these".
One slightly off-topic note: If you DO co-sign loans for your student, take out life insurance on him. This need hadn't occured to me until a couple years ago when I saw something on 20-20 about a family whose son had died before discharging some very large student loans . . . and since the parents had co-signed for him, they were forced to pay those loans. If memory serves, I think the parents were unable to retire because of this. It was a tragic story -- I mean, it's bad enough to lose your young adult child, but to find yourself forced to continue to pay for an education he never really used? Insurance.
Define "ability to pay."
I guess technically I have the ability to pay the $500K for all 3 kids to go to a more expensive college. It would require massive loans and probably the sale of our home, but I suppose someone would lend us that $$.
However, public college costs are what we feel very comfortable paying.
Dawn
That's a fair question. Ability to pay doesn't mean, "Do you have X amount in the bank?" It means should you allocate this amount of money to college? We're not 7-year olds who can spend every penny they have on candy, knowing that allowance'll come around again next week -- we have to plan our spending.
We have the money and
could pay for our two kids to go to an outrageously expensive college, but it wouldn't be a wise decision in the end. Why? First, college isn't the only thing for which we need to pay. We also need to think about our retirement. I want to have savings left to pay for weddings, to build the retirement house we want, to do nice things with our grandchildren. I don't think it's a favor to the kids to pauper ourselves so they can have THE SCHOOL and then have to have them support us in our elderly years. Second, not going to college would be a bad thing; not going to your first choice is just a bump in the road.
Students can develop tunnel-vision when it comes to college. They get the idea that THIS SCHOOL is IT . . . but being young, they're not thinking about the big picture. They see that the college they choose is a big deal, but they tend to lose focus of the fact that it's four years . . . then it's done. I'm thinking of one of my students who adores a certain small, private school because the dorms are wonderful: All suites, kitchenettes with granite countertops, check-out ipads and game systems . . . but their academics are not great. What matters in the long run is that they have the diploma. For a kid like my oldest who plans to go into nursing, it doesn't matter whether she has a fancy-schmancy school name on that diploma (and the debt to go with it) or whether she has a diploma from State U; what matters is that she can pass the state nursing boards and get a license to work.
So it's a parent's job not JUST to help the student choose a college, but to think beyond to the financial needs and goals that'll come later: A nice house, travel, marriage, retirement savings. Spending it all on college -- on the Mercedes mentioned in an above post -- may be fun, but will it be worthwhile if the student is then forced to drive a used Volkswagen for 10 years or more after college?
