College Spending Money

[brett]

I was fortunate. My parents did not have to pay for my university.

I had a fabulous summer job. Union pay on the railway with lots of overtime. Plus a part time job in a mens wear dept. all year.

Times have changed though. Edu costs have zoomed past the inflation rate as we learned when our children we both progressing thought the post secondary experience.

It is why we have an edu fund for each of our three grandchildren.

 

[Phroig]

The elite privates give no merit money. Several in the next tier (e.g., Northeastern, Rochester, USC) will give some, especially to attract national merit scholars and the like. The residual cost is still around $50-60K per year at these schools. Expected family contribution is approximately 20% of income plus 5% of assets. You can get a better estimate on their websites.

 

[Golden sunsets]

Neither of our kids could file FAFSA due to our income. Both studied at elite/ivy private schools. We paid for everything including monthly allowances, because we could and wanted to, so that they would not have to work during the school year. We did convey an expectation that they would earn good grades and not screw up. Both graduated in 8 semesters and now( mid to late 30's) have successful careers and healthy net worths, one near 7 figures and the other mid 7 figures. I think every child is different as is every family's economic situation. There is no one size fits all solution.

 

[RobbieB]

Of course not.

For me it was we (parents) pay tuition & room/board, you pay the rest. There was no FAFSA back then, but costs were not so high either.

I found motivation in it too, I knew for sure I didn't want to be doing the jobs I worked in the summers forever.

 

[MC Rider]

................
I found motivation in it too, I knew for sure I didn't want to be doing the jobs I worked in the summers forever.

Haha. Delivered newspapers before 16 yo, then Fast food joint, grocery market, Library helper, janitor, shoe salesman, junk store employee. HVAC Co helper (Dad got me that one). Glad to not do any of those in a long time. 30 years in my line of work now. But getting a job in 1981 after college was tough. Think I had 7-8 W2 forms for 1982. All those jobs sucked.

 

[RobbieB]

Dishwasher - busboy, mowed grass at golf course (push mower), shoved brush into chipper (city clean up crew) and finally wound up with the gravy, line worker at Ford.

The dishwasher job paid 20% of the line job at Ford but required more skill. Unions.

 

[tulak]

We paid full tuition/room/board for DS, who graduated last year. When he moved out of the dorms, we gave him a fixed amount each month, which is about the same we paid for room/board and it was up to him to figure out how to make it work. He rented a room in a nicer place and lived off of rice and beans.

Same setup for DD, who's still in college. She chose a cheaper place to live and spends more on food. I suspect she also saves some of the money, but that's up to her.

My philosophy is to pay for the essentials so they won't go hungry and without shelter, but anything beyond that is up to them.

They both realize how lucky they are to have a college education completely paid for and I'm more than happy to help out now, since they'll inherit the rest eventually.

 

[Dash man]

My parents paid my first year, then said I was on my own. I worked between one to three jobs while in school.
For my son, I paid tuition and books for three years, while he worked for his living expenses. His job covered the last year of his tuition.

 

[SnowballCamper]

I went to a private school, paid full tuition (using an outside scholarship), and the school gave me room, and I think the cheapest meal plan. I think it's accurate that most don't pay full price, except at the exceptionally competitive schools where there is an ability to pay.

I think there are lots of ways to develop a work ethic/financial responsibility in kids, and the best way depends on the individual kid's character. I've got a few years before the big decisions come for DD, but so far she demonstrates a clear capacity to live below her means. The first test (for both of us) will be car insurance.

Maybe the way to think about the discretionary spending is in terms of activities the kids want to spend on. Some would merit a bigger contribution from me, versus basic college debauchery.

Good luck.

 

[HarveyS]

You have 5 years. I'd recommend use them wisely to prepare your kid for college.

I'm in the camp of no allowance. Our kids never had an allowance. They were babysitting, dog sitting, snow shoveling, yard cleaning, etc. Then one got a job at the Y and the other tutored other students. (Tutoring was real money for a 16/17 year old). We encouraged saving and investing and taught them how to do the same. "Bank of Dad" paid 6% simple interest on 12/31 each year. They filed state and federal income tax returns each year so they were exposed to that as well.

Besides learning where money comes from the jobs gave them fabulous stories for college application essays. I am convinced that the essay is the only way to separate oneself from the mounds of applications that colleges receive. Make sure you kid has enough experiences to write a stand-out essay.

Both were excellent students in HS. They worked to be well-rounded, actively building their resumes for college applications. Oh, and both scored very well on the SAT/ACT. That took a great deal of study. SAT/ACT scores were the reason for merit grants.

They applied and were accepted at a variety of schools, though not accepted at any ivy schools. We toured many schools and they each selected what was the best "fit" for them. Both selected state schools, just not in our state. Both were awarded merit scholarships to attend - no FAFSA filed for either. Both also turned down free-rides or larger scholarships at other universities because they didn't "fit" there. DW and I were OK with this. We feel that cost is a consideration, not the sole consideration, in selecting a college.

DW and I pay for room/board/tuition/books/transport to/from school. We pay direct to the school when we can. Once they moved off campus we provide a lump sum at the beginning of the semester for room/board/books. They made a budget, we reviewed it together, and they managed it. So far, no problems (one graduated in 2020, 2nd is a sophomore). Everything else - including study abroad (eldest was away for 3 semesters) - comes out of their savings. No allowance/spending money provided by us. Both had on-campus jobs and summer internships.

FWIW, both DW and I paid for our own college and grad school. No financial support (but plenty of emotional support) from parents. They just couldn't afford it back in the 80's.

 

[ERObjd]

My parents did not have enough $$ to send any of us kids to school so uncle Sam and GI bill worked just as well..same with our 3 kids all grown now . 1 Marine 1 Army and 1 Army Reserve all used GI bill and part time job for spending $$ no student loans.

 

[OldShooter]

@Michael, there seems to be a pretty strong consensus here for DD to be working. You and she have the luxury of five years to prepare; this is wonderful. I suggest that you use that time to find strategic employment that will position her for college jobs that are a little higher level than the lawn mowing, shelf stocking, dog-work grade. What are her talents and where, while in high school, can she employ them to strengthen here resume (and her college applications for that matter.)?

In my case I was very fortunate. I got interested in ham radio when I was in junior high and by the time I was a sophomore in HS I had both a ham license and a first class commercial radiotelephone license that allowed me to operate any broadcast radio or TV transmitter in the US. This launched into college jobs as an electronic technician and as a student engineer at two college-operated radio stations. If she's interested in tech at all, some kind of computer-oriented HS jobs might be good. Technical support, "Geek Squad," etc. If not, how about shooting for first-level supervisory slots in retail, restaurants, etc. Waitressing can pay very will, but wouldn't be quite the credential that supervisory experience would be. Five years for planning her strategy and exploring her interests is amazing. Maybe start with volunteer work where her young age won't be a negative, then make tactical moves as she gets older.

 

[MrsHaloFIRE]

20 years ago I got $20 a week for gas and the rest was fir "fun" ie fast food/coffee/laundry quarters. I worked for anything else. If i needed shoes and i recall needing a business suit I gave my mom the receipt and she would reimburse it fully, partially or not at all.

I was on academic scholarships and had to buy the meal plan to get a dorm room. I had access to a savings account that had about 12 k in it for books and a few years gap between tuition and scholarships. Loans for the rest. Paid them off in a couple years. My dad used to drive up 1 day a week and rake me to get a steakdinner. Incredibly nice of him.

 

[MrsHaloFIRE]

I think working in college usinportant because it teaches proper planning/cakendarizing and anticipating the need for time blocks (papers, test prep, group project meetigs). I also think everyone should work retail with the public for a while. Its eye opening for the rest of your life. Also even the worst office job prob has a chair. Such luxury. I haven't forgotten. Worst day at work in an office atleast my feet weren't numb from pain

 

[CindyBlue]

This thread is helping me make a trip down memory lane!

I was lucky enough that my folks lived relatively close to both a junior college and a university. I was allowed to live at home rent free as long as I was going to school. I got along great with my parents so it worked out well for me.

My folks would not go through the application process of needs based scholarships, telling me (and rightly so as I think about it now) that their personal finances weren't anyone's business but their own, and that I was now an adult, and that if I wanted to go to college I'd better find a way. I earned a merit based scholarship to the junior college, enough to pay all expenses with money left over, most of which I saved. I had a job every summer and during breaks, and sometimes part time during the school year, but I took as many classes as I could, both at the junior college and at the university, really overloaded, day and night classes, in order to get through as soon as possible, so finding time for a job during the school year wasn't easy.

I went to the local university after finishing up at the junior college with as many transferrable classes as I could cram in.

I was very lucky to have gone to college in the 70s when costs were reasonable and I could do it on my own while living at home. I had a wonderful experience. Paying my own way was a challenge at the time, but since I knew nothing else, it didn't bother me. I ended up with a degree and a credential, and those earned me a great job I loved for 40+ years.

I really feel for the kids - and their parents - now who are going into such debt to pay for college. Though obviously there are reasons to go into debt to go to college, I hope it still is possible to get a degree without having to go into huge debt, if one is willing to investigate options such as going to a smaller and/or local school and living at home and other budgeting options.

 

[daylatedollarshort]

I really feel for the kids - and their parents - now who are going into such debt to pay for college. Though obviously there are reasons to go into debt to go to college, I hope it still is possible to get a degree without having to go into huge debt, if one is willing to investigate options such as going to a smaller and/or local school and living at home and other budgeting options.

We used Payscale reports and now there is College Scorecard to show what the ROI is for different colleges and majors. With options like financial aid, online classes, tax credits, co-op jobs, community college, transfer programs, commuter schools etc. it does seem still quite possible to get a college degree leading to a nice job these days without having to go 6 figures into debt. One of our kids had a 6 month payback on the first job based on our out of pocket costs (what DH and I paid out).

 

[SecondCor521]

I really feel for the kids - and their parents - now who are going into such debt to pay for college. Though obviously there are reasons to go into debt to go to college, I hope it still is possible to get a degree without having to go into huge debt, if one is willing to investigate options such as going to a smaller and/or local school and living at home and other budgeting options.

It is possible, because I am doing it with my three kids. It's a combination of a number of things to make it work though:

A philosophical decision to not do college debt
Me having a debt-free college degree courtesy of my parents
Me having decent luck and making good decisions in my financial life
Saving for my kids' education since they were toddlers
Using UTMAs, ESAs, and 529s
American Opportunity Tax Credit
Scholarships
Financial aid
In state public universities
Living at home
AP/IB credits
Summer classes
Community college
Jobs (for spending money)

 

[rodi]

This has emerged as a point of conversation in the last two days. Younger son's college only guarantees dorm for first year - he put in an app for the on campus group apartments but did not make the cut with the lottery for spots.

He has a roommate lined up. Unfortunately, that roommate has more champagne budget. His mom is a realtor who helped them look at places - and roommate and mom fell in love with a cute 2 bedroom house walkable to campus. Unfortunately, it's about $300/month more than we'd budgeted based on the cost of education estimates put out by the college. Also, unfortunately, it starts in July, and school starts in September. Son is going to get a part time job to make up the monthly deficit. And either take summer school or work full time for the summer months.

We're not poor - but hadn't really budgeted for the extra cost. At the end of 18 years of 529 contributions we ended up with almost exactly 4x annual estimated expenses (from school website) for the school. Still wrapping our head around the higher rent. Son knows he has to have skin in the game and is fine with it.

 

[CindyBlue]

It is possible, because I am doing it with my three kids. It's a combination of a number of things to make it work though:

A philosophical decision to not do college debt
Me having a debt-free college degree courtesy of my parents
Me having decent luck and making good decisions in my financial life
Saving for my kids' education since they were toddlers
Using UTMAs, ESAs, and 529s
American Opportunity Tax Credit
Scholarships
Financial aid
In state public universities
Living at home
AP/IB credits
Summer classes
Community college
Jobs (for spending money)

You have really worked at making college a financial possibility for your kids! All of the options you are using to make it work are the result of lots of effort and planning - and yes, some luck (such as the debt free education you got from your parents) - on your part. It really still is possible!

 

[CindyBlue]

We used Payscale reports and now there is College Scorecard to show what the ROI is for different colleges and majors. With options like financial aid, online classes, tax credits, co-op jobs, community college, transfer programs, commuter schools etc. it does seem still quite possible to get a college degree leading to a nice job these days without having to go 6 figures into debt. One of our kids had a 6 month payback on the first job based on our out of pocket costs (what DH and I paid out).

...and yet, what I read the most about in the news is the huge debt that kids and parents are going into, especially the student loans that follow kids for years if not decades. You and many others here are proving that it's possible to get a college education without those huge debt payments...why aren't more kids taking that route instead of going into debt for so long?

There is the talk in the government about releasing kids from those college debts they chose to incur (have they done it yet?)

I understand why some students absolutely must go into debt to pay for college. A few of my students had no other option but to take out lots of loans to go to college, because they didn't have the opportunities I did to work and live at home and go to a local, state college, and they, for some reason or another, didn't qualify for many scholarships, not enough to pay it all the way, anyway. They did what they had to do to get that ever so important piece of paper (the diploma) so they could "check the box" on job applications. I get it

But I think that many students are making the decision to go to a "name" college for that "name value," incurring a large debt, rather than finding a college they can afford, that won't leave them struggling to pay it off for years to come. Some get high paying jobs right out of college and can handle the payments, but so many don't...

 

[Closet_Gamer]

Hello....

Spending Money
**************
NOT talking room, board, meal plans, books etc. I'm talking extra stuff.
What is a considered a "good" monthly spending budget? I've been using $250 per month so far.

Merit based aid
*************
I can legally show ZERO income - but assets are 7 figures so I'm assuming no need-based aid although I'll have to research more.

Question: I see on private college sites "99% of our students receive aid". Is that true? Do a majority of students at private colleges get ...$1k, $5k, $10k per year, just because they have good transcripts?

Any opinions or experiences I'd really appreciate - thanks.

I have two kids in college. The only spending money I cover is one tank of gas each month for the car + insurance/maintenance. They also know I will pay for an uber home from anywhere, anytime, no questions asked.

Beer, pizza, clothes, spring break ... this is what jobs are for.

Re: aid. I'm doubtful you will get financial aid with those assets. If you do, the first thing in line will be unsubsidized loans. Meh.

Merit aid is a real thing. You can go the web site of almost any university and with a bit of prowling get an idea of what it takes to qualify for various scholarships.

Both our girls were very good students (though not straight A's) with strong SAT/ACTs and varsity letters/extra-curriculars. One was graduated from our local public high school, the second from a private high school in England due to my expat assignment.

Both were heading into the STEM fields and both got very nice merit scholarships from out-of-state universities. DD2 also great merit money from a couple of private schools but chose the public university instead.

YMMV.

 

[SnowballCamper]

...and yet, what I read the most about in the news is the huge debt that kids and parents are going into, especially the student loans that follow kids for years if not decades. You and many others here are proving that it's possible to get a college education without those huge debt payments...why aren't more kids taking that route instead of going into debt for so long?

There is the talk in the government about releasing kids from those college debts they chose to incur (have they done it yet?)

I understand why some students absolutely must go into debt to pay for college. A few of my students had no other option but to take out lots of loans to go to college, because they didn't have the opportunities I did to work and live at home and go to a local, state college, and they, for some reason or another, didn't qualify for many scholarships, not enough to pay it all the way, anyway. They did what they had to do to get that ever so important piece of paper (the diploma) so they could "check the box" on job applications. I get it

But I think that many students are making the decision to go to a "name" college for that "name value," incurring a large debt, rather than finding a college they can afford, that won't leave them struggling to pay it off for years to come. Some get high paying jobs right out of college and can handle the payments, but so many don't...

Once you're on campus, the loan conversation is a bit different, as I recall. The school counselor offers up the loan, with no payments due until after graduation. In my case, the funds are credited to my student account, and I can spend them on any expense that I can pay for through the school (bookstore, housing, meal plan, tuition, fees, whatever), and at the end of the term, I can get a refund if I request it. That was a couple decades ago for me, but doing the loan was easier than borrowing for a car...no credit check. I paid mine off in short order, but if you get a low interest rate, you might let it ride for a while.

I share this just for context. I think education loan forgiveness is ridiculous. But so is the system set up to line the university endowments, as it currently is.

 

[SecondCor521]

Once you're on campus, the loan conversation is a bit different, as I recall. The school counselor offers up the loan, with no payments due until after graduation. In my case, the funds are credited to my student account, and I can spend them on any expense that I can pay for through the school (bookstore, housing, meal plan, tuition, fees, whatever), and at the end of the term, I can get a refund if I request it. That was a couple decades ago for me, but doing the loan was easier than borrowing for a car...no credit check. I paid mine off in short order, but if you get a low interest rate, you might let it ride for a while.

I share this just for context. I think education loan forgiveness is ridiculous. But so is the system set up to line the university endowments, as it currently is.

These days, I think subsidized loans are not as common, and the interest rates on student loans in general are higher than they used to be. There were also, when I looked at them about 9 years ago, pretty hefty loan origination fees (4%-ish).

 

[Act2]

Tuition, fees, and necessities for me were a combination of scholarships, family savings, and later also loans I took out. But my first year of college my parents gave me a modest monthly spending allowance for pizza nights and small non-necessities, which was intended to keep me from having to work during the first school year so I could concentrate on college. I’m grateful for that experience. (I had jobs after that, and before that in high school.)

 

[MichealKnight]

Thanks

The elite privates give no merit money. Several in the next tier (e.g., Northeastern, Rochester, USC) will give some, especially to attract national merit scholars and the like. The residual cost is still around $50-60K per year at these schools. Expected family contribution is approximately 20% of income plus 5% of assets. You can get a better estimate on their websites.

I do the "estimate" FAFSA calculators with my assets plugged in. I forget exactly but it says $128,000 - I wonder if that's per year, or for 4 years combined. If it's per-year, well, it's a family website I can't comment sincerely