College Spending Money

[MichealKnight]

College

Spending money:

I give my kids $0 for spending money. My deal with them is I pay for everything necessary and connected to school: tuition, room, board, books, fees, transportation to/from, transcripts, etc. They pay for optional extras: pizzas, dates, cell phones, etc.

Eldest was frugal and spent nearly nothing. Middle one likes nicer stuff and has various part time jobs. Youngest is also frugal and is getting paid to go to school so has leftover scholarship money. Each kid is different.

Financial aid:

If your kid goes to a FAFSA school and you can have a low enough AGI and some other criteria, you might qualify for FAFSA-based aid even with lots of assets. There is something called the simplified needs test which ignores assets.

If your kid goes to a CSS profile school or a very selective school, it's harder to get aid.

...

Many private schools have a "sticker" price which nearly nobody pays. The students either get Pell Grants, or institutional merit aid which is effectively a coupon or discount but sounds nicer and is treated better tax-wise as a "scholarship".


My middle one, for example, got a $20K merit aid per year at his school, but it's out of state and private so it's still more expensive than the in-state public. His grades were good but not stellar, but he did manage to earn the IB diploma and the school he chose recruits IB students.

You might want to drill down a bit on the aid numbers. 99% getting an average of $500 a year in aid is far different from 99% getting an average of $20,000 a year in aid. If you use the Net Price Calculator at a school or talk with the financial aid people there they can give you a rough idea.

Most schools are well aware of the other schools they're competing with for students, so you'll see similar aid packages from them. They've got it down to a science, so they pretty much know how much $$$ to offer your kid to make it a tough decision to decide where to go.

I won't write a post individually as they would be 'spamming' according to some - but thank you so much, EVERYONE who has written and shared - please keep it coming.

For us -a state school would be Penn State. With some creativity - for real - I feel I may get in-state for Virginia too. I can't DDs future - but I have a hunch a smaller, private school is gonna be suited for her. A Penn State (tuition only) is around $20k per year. Privates -- be it Lebanon Valley, Gettysburg, etc - - $40-$50k per year, tuition only. A few more questions..... please anyone jump in:

For Bachleor's does it give a student an "advantage" getting a good job - - if they graduated from a private college vs something like Penn State? I assume *YES* - but the other day a Mom told me that PennState - has a culture of alumni helping grads - vis a vis. hiring - and that's a real thing. Naturally - I wanna believe that saving $30k yearly tuition is "smart" and will lead to the same opportunities - but something tells me there's a reason people shell out the private money. I look at random LinkedIns - the young bigshots are mainly from privates.

I also wonder - how about a plan where 4-years is a state school. But Masters - go for it, wherever you can get in because my logic is - perhaps that's what companies look at more than the undergrad?

Also - our school is ranked well - but NO "I.B". My 8th grade DD has been recommended for *all* honors level courses in 9th - and the school does have A.P.

If a student does well in some AP courses - does that count as much as IB or is a kid at a disadvantage.

*finally!* - I"m worried that "all" honors courses in 9th grade - man it'll eb too much. Is it better strategy to take easier classes - get GPA- have more time for extra-curricular., or load up on AP...... OR - take a little AP - but then use the time to do well at all the classes plus some extra curricular?

 

[MichealKnight]

Expenses

As far as spending money, I'd be inclined to keep some of the budget in your hands vs. direct cash:

Preload an Uber account
Regular care packages of socks/underwear, snacks, etc.
Grocery store gift cards

Of course, most creative kids will find ways to turn all that into cash if they really want to, but this way you can make sure they are fed, clothed, and have a safe way home from off campus parties.

This is 5 years away. And I'm doing LOTS of assumptions - primarily DD continues to be the student she is in middle school, and that I won't screw the pooch financially.

We give both kids allowance based on chores now. They are expected to record it in their notebook each week, along with record any expenses. 20% goes into an envelope marked "pay yourself first" that they don't touch. (my little boy is greedy one. The compound interest calculator might have been his first intimate experience lol). The are shown *all* the time - how saving helped our family, how we have money - but no $3000 handbags like the other Moms. How using the right credit card points, clipping coupons, etc - allows us nicer things.

If today were the day for college I'd decide that everything PURE college - we will take care of, with certain strings. Restaurants, movies, uber, etc - -- $50 per month is what is on me. Beyond that, part time work, or in DD's case I think one day she might be a tutor for little kids over summer, maybe,

 

[SecondCor521]

[1] For Bachleor's does it give a student an "advantage" getting a good job - - if they graduated from a private college vs something like Penn State? I assume *YES* - but the other day a Mom told me that PennState - has a culture of alumni helping grads - vis a vis. hiring - and that's a real thing. Naturally - I wanna believe that saving $30k yearly tuition is "smart" and will lead to the same opportunities - but something tells me there's a reason people shell out the private money. I look at random LinkedIns - the young bigshots are mainly from privates.

[2] I also wonder - how about a plan where 4-years is a state school. But Masters - go for it, wherever you can get in because my logic is - perhaps that's what companies look at more than the undergrad?

Also - our school is ranked well - but NO "I.B". My 8th grade DD has been recommended for *all* honors level courses in 9th - and the school does have A.P.

[3] If a student does well in some AP courses - does that count as much as IB or is a kid at a disadvantage.

[4] *finally!* - I"m worried that "all" honors courses in 9th grade - man it'll eb too much. Is it better strategy to take easier classes - get GPA- have more time for extra-curricular., or load up on AP...... OR - take a little AP - but then use the time to do well at all the classes plus some extra curricular?

[Numbers added for reference.]

The following is my opinion. People have lots of opinions, I'm sure you'll get more.

As background, I graduated from a public high school with 2 AP exams under my belt, went to an Ivy League for 2.5 years, finished at a regional out of state private liberal arts university, and have an MBA from an in state public university. My 3 college age kids have gone to in-state public universities (2) and out of state private regional university (1) after graduating from online high school, private IB school, and private school with AP classes.

1. There is some advantage to the Ivies, Stanford, and the big name schools that everyone knows in terms of getting in the door for an interview. But the kid themselves also matters, and a smart kid who goes to a university that is a good fit for them can generally do very well. If your kid knows they want to work on Wall Street as a quant *and* they can get into Yale (etc.) *and* you think they'd fit in and be happy there *and* the finances work, then sure, think about it. But my son who graduated from the online high school and an in state public university is just as happy and getting paid as well as his cousin who graduated from an Ivy League and has a masters degree from a big name school.

And while employers might be happy to hire a Harvard grad, there are millions of open jobs each year and less than 50K graduate from the Ivies. Even if you include the other big name schools, the employers pretty much fill their openings every year with the 95% of us who don't graduate from the top schools.

2. If it's a career where the master's degree matters, and you know the kid is going to go on, then yeah, it's a decent strategy. Some people might say that the chance of a kid getting into a name brand master's program will depend on their undergrad school. It probably does somewhat. But not that many go on to grad school, and if the kid has good grades, a good GRE/GMAT/LSAT score, and good recommendations they'll probably get in somewhere. I'll add that even with my two current college sophomores, I really have very little inkling at this point if either, both, or neither will go on to grad school.

3. Probably more. With the exception of the one school that my middle son actually ended up going to, most universities were much more familiar with AP and much more willing to give credit for it than for his IB work. There are very few IB kids out there; if your kid does all the APs they want to (see next answer), they'll be in good shape. Even if they're at a disadvantage to some random IB kid (and they probably aren't), remember that universities accept lots of kids every year - it's not like your kid and the IB kid are duking it out for the last spot at school X.

4. Colleges will generally say that they'd rather see a capable kid try AP classes, work hard, and get a B than to take easier classes and get an A. But you also don't want to "load up" your kid with as many AP classes as they can get into if it's going to overwhelm them academically and make them unhappy, demoralized, or dejected.

Usually they can start AP classes in 9th grade - I'd say certainly have them consider the AP courses that are in their areas of strength and/or interest. And listen carefully to your student as to what they feel OK trying. Perhaps also with the input of the student's teachers and maybe the counselor if you trust them and they know your kid very well.

If they take 2 APs in 9th grade and do well, they can always dial it up in 10th/11th/12th. If you stick to the ones your kid actually wants to take, they can probably fit all the APs they're interested in in their 4 years. If they take 2 APs in 9th grade and struggle or are unhappy, then maybe dial it back.

And there are also plenty of kids who start AP classes and after the first two or three weeks of the semester, downgrade their schedule because they're struggling with the teacher, the material, their maturity, or the workload. I think it'd be smart to check in with your kid after a few weeks and adjust if needed.

On extracurriculars, the impression I got from most schools is that they have caught on to students who are doing a smattering of everything to appear well-rounded. So now they ask questions to quantify things - did your kid "volunteer at the Red Cross" by handing out cookies for an hour one weekend, or have they been organizing 6 blood drives a year since 6th grade? And they seem to want a kid who has done a few things deeply and well rather than really shallow and broad. But again, if your kid has a variety of interests that they want to pursue, that's OK too.

 

[daylatedollarshort]

For Bachleor's does it give a student an "advantage" getting a good job - - if they graduated from a private college vs something like Penn State? I assume *YES* - but the other day a Mom told me that PennState - has a culture of alumni helping grads - vis a vis. hiring - and that's a real thing. Naturally - I wanna believe that saving $30k yearly tuition is "smart" and will lead to the same opportunities - but something tells me there's a reason people shell out the private money. I look at random LinkedIns - the young bigshots are mainly from privates.

Here is the latest research - "Does it Matter Where You Go to College?....The simplest answer to the question “Do elite colleges matter?” is: It depends on who you are. In the big picture, elite colleges don’t seem to do much extra for rich white guys. But if you’re not rich, not white, or not a guy, the elite-college effect is huge. It increases earnings for minorities and low-income students, and it encourages women to delay marriage and work more, even though it doesn’t raise their per-hour wages." https://www.theatlantic.com/ideas/archive/2018/12/does-it-matter-where-you-go-college/577816/

And then there is this link -

"The most coveted jobs are in Silicon Valley, and most selective US universities are members of the Ivy League. So it stands to reason that tech giants like Apple, Google, Amazon and Facebook would scoop up best and brightest from those bastions of power and privilege.

Think again. None of the eight Ivy League schools—Harvard, Yale, Princeton, Brown, Columbia, Cornell, Dartmouth and the University of Pennsylvania—cracked the top 10 on a list of the universities sending the most graduates to tech firms, according to an analysis by HiringSolved, an online recruiting company. https://qz.com/967985/silicon-valle...ities-and-none-of-them-are-in-the-ivy-league/

San Jose State is on the list, a good value bargain at $8K a year tuition (in state, $20K out of state). College Scorecard and Payscale also have reports on ROI by college and major.

 

[imnontrad]

Well, first of all, sit each kid down and have them spend 10 hours per week researching and then applying for different scholarships and grants. You may find out that scholarships given out by local organizations actually have very few applicants (some may only have one or two). So there is a possibility that they will be able to group together enough scholarships and grants to pay for their college expenses.
While doing this, they can also research different careers - but those that require a college degree and those that are a technical school route. They should find ones that interest them plus associated fields and determine the beginning and mid career salaries. They should also identify any unique aspects of the career (requires advanced education, only exists in HCOL area, only overseas, a field where they can later start their own business, etc)
They should also research different college possibilities. this includes earning college credits while still in high school, community college, online classes for credits (and lower cost), etc.
When I was in college the first time, the classmates who had their parents paying for everything tended to not only pick majors that had little/no career prospects or low salaries plus tended to graduate later.

 

[marion10]

My kids are 30 and 33- so it hasn’t been that long. They both got generous merit scholarships to smaller private colleges. It cost us less than our state schools and I feel they got a better education. I am not a fan of giant lecture halls taught by teaching assistants. We needed to file the FAFSA to get the merit aid. In my daughter’s case, we got more $$ from her preferred school by showing a competing offer from another school. We insisted than they manage ther own college application process- which they did. They both took AP classes and in my son’s case, he took some AP tests without taking the class at school and did well enough to get awarded credit. AP classes did not let them graduate sooner- but gave them advanced standing so that it was easier to pick classes. They both lived on campus all four years- although as upper class men in campus apartments. I don’t think they had any on campus jobs freshman year, but by sophomore year, they certainly did. We had saved and saved, so no loans for them.

 

[imnontrad]

BTW, When I went back to a university for a second degree, I had a required class on state history. I found out that I could "test out" of the class by passing an exam. I spent a weekend reading the textbook and studying, took the test - and passed/ got the college credit. This was a LOT easier than an AP class. Many colleges and universities have the option to test out of lower level classes.

 

[meleana]

We paid for our son's college and also let him use one of our cars. He attended college out of state.



But we gave him no spending money. We told him he had to work part time for that, as well as pay his cell phone and gas for the car. (he was on our auto and medical insurance policy).

 

[1242Vintage]

We have three kids and all are now through undergrad.

As far as a spending budget, we didn’t give them any. We provided a credit card along with the expectation that it’s to be used for living and school expenses. None of the kids ever abused that trust.

The two older kids went to a public university and didn’t get any scholarships, needs or merit based. We did however take modest federally-backed student loans. These were around $3-5k a year and interest didn’t start to accrue until they stopped being full-time students. We figured that was their skin-in-the-game.

Our older daughter did get a break in tuition to attend a public university in a neighboring state and only pay their in-state tuition rate.

The youngest is deaf and was fully financially supported through undergrad by our States Dept of Rehab. When she continued on to grad school we noticed various seemingly random scholarships that she didn’t apply for and we never heard of being applied to bring down her tuition bill. I think some private big name universities get large endowments and donations and simply spread those funds across their student population.

 

[jollystomper]

When our kids went to college, we made it clear that Mom and Dad would pay ( beyond what scholarships covered) for room and board, anything else beyond that was their responsibility. Either save your money from summer jobs, or work while on campus.

One of our sons ran into an issue his freshmen year. The school "credit card" they used at dining halls, which their meal plan was loaded on, was also accepted by many stores around the campus. He ended up using it to buy non-food items, and ran out about 2 months before the end of the term. We told him "no rescue from mom and dad, you figure it out". And he did. He never made that mistake again.

When I was attended school, as part of my financial aid I was expected to work. This was my spending money, I had no expectations of Mom and Dad bailing me out. I also looked for good paying summer jobs to save from. It was tough before my freshman and sophomore years, but I did get good jobs before my junior and senior years - both due more to the networking I had done than my grades.

In the never ending debate about expensive Ivy League/top tier schools vs cheaper public schools, it is more about the child's personality and self motivation than anything else. I have Ivy League classmates who struggled to get jobs after graduation, and friends who went to public school you were beating off the offers from finance and consulting firms. The ability to network and get along with people, particularly if they think "differently" (however that is defined), are the key things noticed.


I was an volunteer alumni admissions interviewer for my Ivy League school for about 30 years. I interviewed over 200 applicants in both the New England and Mid-Atlantic area, most of them from public school. About 15 were accepted. We were asked to evaluate them not on grades (in fact we were not privy to them, and we could not ask about them, and it almost all cases these were straight A students anyway), but to try to find out "what makes them tick" and "how might they contribute to both the academic and non-academic aspects of the school". It was always an interesting challenge to try to draw out enough from the student to evaluate that. But I enjoyed it.

 

[samcat]

In 2013, we gave our son $200 a month for expenses when he lived in the dorm (food prepaid). We did give extra for books, clothes, frat dues, football tickets, etc. I guess the $200 was for eating out if he wanted to and entertainment (and misc small purchases). He really shouldn't have needed much since we did pay for extras.

In 2014, he moved into the frat...we gave him $300 a month. Again, we paid for extras. The $300 was for groceries because the frat did not provide food. He worked so he used his money to pay for anything above the $300.

In 2015, we gave him $400 a month.

This was a long time ago - it seems like yesterday but it was almost ten years ago! Yikes.

I think now, I would follow the same path but give him an allowance for Uber or have him tell me what he spends and I would reimburse him for that - safety.

Also, he "paid" for $5k per year of his schooling (less $7k in scholarships he received). He ended up getting his last semester tuition and his one years masters tuition for free because he was a graduate student instructor so we forgave whatever he owed us for school.

He did owe us some for living expenses from a summer in San Diego when he had an internship...he paid us back for that as that was not part of his college expenses.

As for scholarships, he was given $20k at one private school and $10k at another private school but both were still more than the public university where he went. All in, we spent just over $100k on five years of school at a public university in California. The privates would have been at least twice that for four years.

 

[Buckeye]

A TrueLink account might be a good option once you decide the monthly amount. The fee is currently $10 per month or $100 per year. You can generally control where the card can be used and you can control whether it can be used at an ATM. You just link the TrueLink account to a bank account and transfer money into the TrueLink account as desired. You have a view into where the money is spent, if that is important to you.

https://www.truelinkfinancial.com/

 

[FlaGator]

I won't write a post individually as they would be 'spamming' according to some - but thank you so much, EVERYONE who has written and shared - please keep it coming.

For us -a state school would be Penn State. With some creativity - for real - I feel I may get in-state for Virginia too. I can't DDs future - but I have a hunch a smaller, private school is gonna be suited for her. A Penn State (tuition only) is around $20k per year. Privates -- be it Lebanon Valley, Gettysburg, etc - - $40-$50k per year, tuition only. A few more questions..... please anyone jump in:

For Bachleor's does it give a student an "advantage" getting a good job - - if they graduated from a private college vs something like Penn State? I assume *YES* - but the other day a Mom told me that PennState - has a culture of alumni helping grads - vis a vis. hiring - and that's a real thing. Naturally - I wanna believe that saving $30k yearly tuition is "smart" and will lead to the same opportunities - but something tells me there's a reason people shell out the private money. I look at random LinkedIns - the young bigshots are mainly from privates.

I also wonder - how about a plan where 4-years is a state school. But Masters - go for it, wherever you can get in because my logic is - perhaps that's what companies look at more than the undergrad?

Also - our school is ranked well - but NO "I.B". My 8th grade DD has been recommended for *all* honors level courses in 9th - and the school does have A.P.

If a student does well in some AP courses - does that count as much as IB or is a kid at a disadvantage.

*finally!* - I"m worried that "all" honors courses in 9th grade - man it'll eb too much. Is it better strategy to take easier classes - get GPA- have more time for extra-curricular., or load up on AP...... OR - take a little AP - but then use the time to do well at all the classes plus some extra curricular?

I was in AZ, now in FL, and no one in either place would "dis" a degree from PSU.

From what I've seen, where the BA/BS comes from matters less than where the graduate degree is from, although that varies by field of study. A master's in social work from Harvard will be marginally less employable than one for Penn State. Reality is that it is hard to make a decent living in that field no matter the education. If we're talking electrical engineering and it's MIT vs. NM State, it's a different deal.

My oldest loaded up on AP and online courses in HS. She'll finish her BA in Ed in three years, but sticking around for one more to get a master's. So, there is benefit if they can handle to academic load. If they can't in HS, maybe better to set sights on a state school after finding a field of study/career path they can be successful in.

The oldest is going to school in-state, and the youngest almost certainly will be too. For the middle/HS teacher the oldest will be likely become, anything but a state school is an utter waste. We'll see where the HS Junior lands, but it doesn't appear to be headed anywhere that a prestige out-of-state school with a substantial alumni network would be useful. Plus neither are interested in moving out of FL.

Hope this is useful. You're welcome to PM with more specific questions.

 

[Philliefan33]

OP, I hope you are aware that Penn State is not really a “state school”. It is state affiliated, meaning that in-state students pay a lower tuition, but the true state schools are West Chester, East Stroudsburg, Mansfield, etc. They are much less expensive than Penn State.

If you are willing/ able to pay for Penn State, your DD could also consider University of Pittsburgh or Temple which are also state-affiliated and have similar costs (but much different environments) as PSU. I haven’t checked lately, but when my DD was doing the college search, out-of-state at University of Delaware wasn’t much more than in state at PSU.

 

[caninelover]

$250 a month for spending money seems luxurious, if room, board and books are covered. I get there are some other expenses for sundries, haircuts, clothes, and the occasional off-campus meal/show/whatever. But $250? Unless the kid in downtown Manhattan - I would stick with $100/month and the kid can cover any extra beyond that with summer jobs or part time jobs.

Most colleges provide a lot of free activities on campus for students. Though its healthy to get off campus once in awhile on the weekends, most of the week they will just be on campus and eating on campus through the food plan.

 

[foxfirev5]

Even in todays dollar the numbers being thrown around are nuts. My whole, while questionable, four year degree was under $15k in 1978. Two of our three kids graduated from state universities at under 40k total in the early 2000's. Got jobs are doing good.

However, DW beat all of these when she decided to quit being a SAH Mom and go to nursing school at the local CC. In the early 90's at age 35+ she enrolled, graduated with honors and had a nearly 20 year career. Ending up as a research nurse at a Big10 school. ALL for slightly over $2500 in tuition. No student aid, Pell grants, loans. ROI off the charts.

I'm not so sure of the value of a degree anymore. As a matter of fact the highest NW people I know have no degrees at all. Self employed business owners. Building and construction related.

 

[OldShooter]

... I'm not so sure of the value of a degree anymore. ...

Bingo. Everyone is telling the kids that they have to go to college in order to get a high-paying job. Statistics support this; college graduates make more money.

But if the supply of college graduates is significantly increased by this promotion of college, why would anyone expect that the supply of high paying jobs would automatically increase too?

 

[RobbieB]

Some degrees are worth more than others. Engineering, computer science, nursing and such others in demand.

 

[daylatedollarshort]

Google doesn't require college degrees these days. They are trying to disrupt the 4 year college degree program with more focused certificates. They have a consortium of employers accepting their certificates.

"College degrees are out of reach for many Americans, and you shouldn't need a college diploma to have economic security," writes Kent Walker, senior vice president of global affairs at Google. "We need new, accessible job-training solutions--from enhanced vocational programs to online education--to help America recover and rebuild."
Walker then revealed the following on Twitter:

"In our own hiring, we will now treat these new career certificates as the equivalent of a four-year degree for related roles." - https://www.inc.com/justin-bariso/g...tificate-project-management-data-analyst.html

Per the Google FAQ - The IT Support, User Experience Design, Project Management and Data Analytics Certificates cost $39 per month by subscription on Coursera. U.S. degrees, even the community college ones, seem to have a lot of irrelevant, yet required classes and add on an extra year of school compared to at least some of the programs we've looked at in other countries for our kids. I really like that Google is doing this. It seems like a great value in terms of both time and money.

 

[RobbieB]

They are creating an apprentice program for just what they are looking for.

Like unions do with plumbers, electricians and carpenters.

Sounds good to me!

 

[EastWest Gal]

We paid for our son's college and also let him use one of our cars. He attended college out of state.


But we gave him no spending money. We told him he had to work part time for that, as well as pay his cell phone and gas for the car. (he was on our auto and medical insurance policy).

We set DS up with a credit card for gas and other expenses. It was a joint account with DH, so we could monitor his spending. He used it for gas only except for a couple of fast food meals per month. He joined the school ski club but had a class on club nights. The next year, there was no snow. He broke up with his high school girlfriend after freshman year but never date, so no expense there. We covered cell phone, health and auto insurance as well.

My parents gave me a credit card on their account to use as needed in medical school. I bought a few clothing items and gas for the car. The credit card bailed me out when my car broke down on I-5 at the Grapevine on the way to school after spring break. For spending money I used the money from the private loan from a rich aunt. I managed to have enough leftover to pay for our wedding. I really did not have time to work during medical school.

 

[jollystomper]

Some degrees are worth more than others. Engineering, computer science, nursing and such others in demand.

+1

The challenge is to get Colleges and Universities to admit that.

 

[MichealKnight]

Just curious - Univ Pitts vs Penn State - you said difference in environment - could you describe a bit please. Thanks

 

[MichealKnight]

Link - College, Aid, etc

In case in the future someone stumbles upon this thread..... decent information is in here, especially about applications, student loans, a glossary, the process, etc.


https://s.wsj.net/public/resources/documents/the-wsj-guide-to-student-loans.pdf

 

[BlueberryPie]

We expected our son to provide his own spending money which he did by working in summers.

That's what we do. Forges character

We also paid for the cheapest university housing, so our son has a roommate. He's welcome to come up with the extra money to upgrade to a private room.