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Old 09-13-2010, 12:17 PM   #21
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Business Week profiled some interesting initiatives:
The 'No-Frills' College of the Future - BusinessWeek


Looks like they're going to go heavily toward online learning (no dorms or athletic centers for these students) and the community-college credit-transfer concept.

Hard to separate the reality from the marketing, though.

Although there may be a general backlash against the rising cost of tuition, I suspect that the most a parent should be responsible for is a couple years at a community college followed by a couple years a State U. And depending on the kid, maybe a parent shouldn't even be responsible for that much.

Our kid took quite a different tack, but she's letting the federal govt subsidize three-quarters of it in exchange for training her to be a hired killer. Seems like a fair deal to me... and saved us all quite a bit of money, too.
congrats to your kid which got into a service academy- that is not easy, good for them.

As for schools using other approaches to cut costs, how about professor benefits? If colleges start requiring web based training (self paced training) for more than maybe 5% of credits taken, that IMO is defeating the reason for college, which is human interaction.

So much of communication is non verbal. And so much of the communication done by teens these days is texting, twittering and checking someone's FB status. None of that is real communication which translates well into w*rking.

For example make state school professor salaries be directly linked to the 3 year retention rate for graduates getting jobs (how many graduates got a job and kept it for 3 years after graduating). That is a better measuring stick of college success than how many of my 180 credit hours I could take from my PC (instead of showing up to class and talking with people.

Its about the people.
Anything less is not acceptable (to me).
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Old 09-13-2010, 01:00 PM   #22
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I think we're getting derailed, but I disagree on your approach to online vs in person education. I've done both for years at each of them and found that online school actually forced a much more disciplined approach for the student, as well as time management skills. Additionally, while the interaction may not be in person, it is done on daily basis at many schools which foster the 'team' atmosphere on a daily basis (University of Phoenix is famous for this). And after all, such as we are doing right now, I think you'll find that 1/2 or more of communication done in todays' professional or office based jobs is done via email.

how many colleges have a trust fund worth hundreds of millions if not billions of dollars that is growing faster than it is being spent? How many of those schools raised tuition last year? (all of them). How many deans are making rediculous amounts of money? Why should a state employee such as the dean of UW make $900,000 per year? where else can we find waste?
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Old 09-13-2010, 01:03 PM   #23
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at the end of the day these things are not what brings me to this post though.

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to me it was very stressful giving my parents a college tuition bill, and i married quite young (20) and so again I felt like I was putting the tuition bill on someone else (my wife) even though I worked full time. I put school off for a few years and now I am back and my business pays my tuition. I don't want money to play any role in my son's decision to go to school.
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Old 09-13-2010, 01:24 PM   #24
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I have setup an account for my son, who is now 15 months old, right after he was born. I now have $2k in there and it is setup to automatically contribute another $50/month. I will probalby need to increase that, but I wanted to get something started. If I have another child (which we plan to)... it doubles.

1/2 of his money is in GE stock, 1/2 is currently cash. I can setup an automatic purchase system to buy into a suggested equity once per month at a fee of $5. however that's 10% of the $50 I'm putting in there! so it seems like a bad idea.

with 18-20 years till d-day, what are some recommended investment ideas for my son's college future? I am not using a 529 or other shelter because I liked the flexability of allowing him to use the cash for a business, house, etc if he doesn't go to college. however, at the same time I'm thinking about buying some of the college credits that you can get now and apply later (protecting you against inflation). Just some though, not a full 4 years, as in 18 years if he doesn't go to school I can get all that money back, but not with any interest!
I am in a similar situation with a 17 month old and a 3 year old and use a simple approach. I have 529 plans for the kids that use a combination of the vanguard s&p 500 index and total bond market index. You can invest directly in the vanguard funds if a 529 doesn't meet your needs. I feel like these funds provide a broad range of diversity for a 17 to 21 year time horizon with very little monitoring. I will increase the bond allocation weight as the kids get older looking to be 90 percent or more in bonds when they are 16-17 years old.

As a side note to those for/against 529s, paying off mortgages before college, etc - I think several posts have fallen into the one size fits all trap. There are situations when saving for college in a 529 and maintaining a mortgage makes the best financial sense due to tax implications, w*rk situations (e.g., some people have employer subsidized mortgages), etc. There are other situations when paying off the mortgage is better or when a 529 doesn't make sense. There are too many variables to say that one approach is always better.
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Old 09-13-2010, 01:49 PM   #25
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Why should a state employee such as the dean of UW make $900,000 per year? where else can we find waste?
Right. Why should any educator be paid what we pay the football coach?

Salaries At UW are on line

UW System Salaries Search
The president makes 414,000

Reilly, Kevin P President $414,593
The Dean of the well regarded law school makes about 300,000

Davis, Kenneth B JrDeanMadisonLaw School $304,436
Now in our Medical school the dean is a praciticing physician who gets paid for the patients. that may explain the $900.000
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Old 09-13-2010, 01:52 PM   #26
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no I agree the football coaches are overpaid as well. notice i said 'state employee'.


no state employee should make more than the governor.
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Old 09-13-2010, 02:02 PM   #27
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I am in a similar situation with a 17 month old and a 3 year old and use a simple approach. I have 529 plans for the kids that use a combination of the vanguard s&p 500 index and total bond market index. You can invest directly in the vanguard funds if a 529 doesn't meet your needs. I feel like these funds provide a broad range of diversity for a 17 to 21 year time horizon with very little monitoring. I will increase the bond allocation weight as the kids get older looking to be 90 percent or more in bonds when they are 16-17 years old.

As a side note to those for/against 529s, paying off mortgages before college, etc - I think several posts have fallen into the one size fits all trap. There are situations when saving for college in a 529 and maintaining a mortgage makes the best financial sense due to tax implications, w*rk situations (e.g., some people have employer subsidized mortgages), etc. There are other situations when paying off the mortgage is better or when a 529 doesn't make sense. There are too many variables to say that one approach is always better.
The 529 is probably the way to go. I have been cautious with any plan which 'trapped' the money into a one-purpose only plan. Their is the government "GET" program as well. You buy credits today, and redeem them when you go to school. So you basically get credits in 18 years at todays price (but you have to pay today). that could be worth a small fortune in college credit by the time you redeem. The problem is if you opt not to use them for college credit, you can be reimbursed the full amount that you invested and nothing more (no interest) so if I was able to turn a $5,000 investment today into $27k (18yrs, 10%) I would have more to offer my son if he opted not to go to school... or one covered by GET. as the GET program would only give me my $5k back.
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Old 09-13-2010, 02:58 PM   #28
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congrats to your kid which got into a service academy- that is not easy, good for them.
Actually spouse and I are the service academy alums; our kid (after years of debate) went NROTC at Rice. NROTC (and USNA) seem a heckuva lot easier to get into than Rice... most of her NROTC unit is made up of mids from colleges around Rice.

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As for schools using other approaches to cut costs, how about professor benefits? If colleges start requiring web based training (self paced training) for more than maybe 5% of credits taken, that IMO is defeating the reason for college, which is human interaction.
So much of communication is non verbal. And so much of the communication done by teens these days is texting, twittering and checking someone's FB status. None of that is real communication which translates well into w*rking.
Anything less is not acceptable (to me).
It may not be real communication for our generation, but it works quite well for their generation.

Or perhaps it works well for more than one generation. I've been watching a company that sells guides & maps to visitor destinations. The CEO is in Hawaii, the Pres is in California. Production & shipping are near the Pres's home but the business is expanding and needs more space so will probably have more than one shipping location. Sales are led by a guy who lives in Tampa with an assistant in Texas. Bookkeeping and accounting/taxes are done locally here in Hawaii but they swap e-mails and websites instead of meeting in person. The whole company works quite well across six time zones and only gets together a couple times a year in person, mostly for sales/convention events.

I can get as much human interaction as I can handle at taekwondo or surfing or other leisure activities. Learning doesn't need to be with a group unless everyone in the room really wants to be there. At most colleges, not everyone in the room (including the prof) really wants to be there.

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The 529 is probably the way to go. I have been cautious with any plan which 'trapped' the money into a one-purpose only plan.
529s still have to be used for educational purposes, which makes it difficult to tap the money (without penalties) if a kid wants to skip college for self-employment or other non-traditional certifications/occupations. OTOH an "education savings bond" can be used for anything if the tax is paid... it's only tax-free when redeemed for educational purposes.
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Old 09-13-2010, 03:04 PM   #29
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Right. Why should any educator be paid what we pay the football coach?

Salaries At UW are on line

UW System Salaries Search
The president makes 414,000

Reilly, Kevin P President $414,593
The Dean of the well regarded law school makes about 300,000

Davis, Kenneth B JrDeanMadisonLaw School $304,436
Now in our Medical school the dean is a praciticing physician who gets paid for the patients. that may explain the $900.000

Education | Emmert says his own salary is on the table as UW decides on cuts | Seattle Times Newspaper

Quote:
Nevertheless, he was the second most highly compensated public university president in the nation, at $888,000 for 2007-2008.[3] In addition, he received $200,000 compensation for serving on the board of Expeditors International and $140,000 for serving on the board of Weyerhaeuser, giving him a total annual compensation of over $1.2 million.
Quote:
Salary: Emmert was the nation's second-highest-paid public university president, with a salary of $906,500. He also collected an additional $340,000 in cash and stock from sitting on two corporate boards. That level of compensation put him under increasing fire as the state budget hit hard times and the UW faced severe cutbacks. When he and other senior leaders announced in February that they would donate 5 percent of their salaries to student scholarships, some considered the gesture too little, too late.
Local News | Key points in UW President Mark Emmert's tenure | Seattle Times Newspaper
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Old 09-13-2010, 03:15 PM   #30
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Custodial accounts count towards financial aid, since the account is technically an irrevocable gift to the child, even though in most states the kid can't get the money until age 21.

I have a couple 529 plans for my kids, we fund them monthly.

I guess it depends on what you are trying to achieve. If an expensive private college is in their future, I would load up on 529, because it will help with financial aid. A tax-efficient mutual fund account would work if financial aid is not a big concern.

I have seen firsthand a few disasters with custodial account................so I don't load those up..........
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Old 09-13-2010, 03:18 PM   #31
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no I agree the football coaches are overpaid as well. notice i said 'state employee'.


no state employee should make more than the governor.
Most football coaches are not really state employees in a pure sense. Typically the athletic booster club funds a lot of the coache's salary. That's how coaches move from college to college, most universities don't have an extra couple million set aside to pay Pete Carroll or urban Meyer........
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Old 09-13-2010, 03:38 PM   #32
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Custodial accounts count towards financial aid, since the account is technically an irrevocable gift to the child, even though in most states the kid can't get the money until age 21.

I have a couple 529 plans for my kids, we fund them monthly.

I guess it depends on what you are trying to achieve. If an expensive private college is in their future, I would load up on 529, because it will help with financial aid. A tax-efficient mutual fund account would work if financial aid is not a big concern.

I have seen firsthand a few disasters with custodial account................so I don't load those up..........
what do you consider an expensive school? I am paying about $1500/month and I consider that to be expensive but it is not really in the grand scheme of things.
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Old 09-13-2010, 04:00 PM   #33
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what do you consider an expensive school? I am paying about $1500/month and I consider that to be expensive but it is not really in the grand scheme of things.
I did some calculations for my state, if I can get the kids through a school at about $16,000 a year, it's a wash. Above that it starts tilting toward 529s and such. Marquette University tuition is $37,000 this year, while UW Madison tuition and room and board is $16,500. Is Marquette a much better school than UW-Madison? Not sure, but neither school has any problems placing their grads..........
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