Tuition Fees and Student Loan Debt: A Shock?

[Anita18]

IME, student loan debt means nothing to high school kids because the amounts of money are not real to them and they have no concept of what it costs to just live. If you tell them "This is what you can expect to make a month and this is how much you will pay in loans," it sounds good to them because they have no idea of how much it will cost just to live, plus it's all waaaaaay off in the future and you worry too much.

I don't know what you have planned, but you might want to have him do a little research on things like starting salaries and living expenses.

Was just sitting in class an hour ago and again, was trying to tell people not to go to the $$$$$$ art school if they want to learn how to make mobile applications. Seriously - my fiance didn't go to school for computer programming OR art, and he got a well-paying job doing mobile apps for a well-known Bay Area startup. He learned how to do the programming and art in his spare time and released a few apps on his own. The new software companies want go-getters, people who have work behind them even if it's on their own, not "please hire me I have this 4-year degree so I think I know a lot" people. (Although, it didn't hurt that he DID have an engineering degree from a well-known school...)

But nobody listened, of course. They really believe that their only option is to go 5-figures in debt. I guess that's what life experience gives you - the realization that there are more options than just school.

The best part was that one of them was already complaining about how broke she was, and how printing out the final project was going to be expensive. And you think printing stuff at the $$$$ art school is going to be cheaper? You'll only be doing it 1000 times more!

I certainly agree that most universities are very bad at that. I remember being told about the average starter wage for a beginner journalist during the degree - about $35,000 a year. Okay, says me. Not great. But that's all right, I'll have time to save up.

What they DIDN'T tell us? That FINDING a job as a beginner journalist is about as easy as going to the moon. Everyone wants two or three years of experience and almost no-one wants the graduates.

I have a friend in the UK who has a journalism degree, and nobody's hiring. The only jobs she can get are in bartending and "direct marketing," i.e. door to door sales. She's starting to get pretty down on the whole thing.

[myhoneyhoney]

Wow, am I the only one who had parents that expected the student to pay the majority of the college costs? My parents are big with college with my dad earning masters in business and my mom earning her masters in nursing. Both of them worked and payed for their college education so the same was expected of me. Growing up I was pretty shocked hearing about parents paying for the entire college education. I expect my kids to do the same for the majority of their college education. I mean, they'll be 18 by then, ADULTS, so they should shoulder the responsibility of paying for the majority of their education and not just have it handed to them unless they're given a full scholarship, of course.

[PDilemma]

I have a friend in the UK who has a journalism degree, and nobody's hiring. The only jobs she can get are in bartending and "direct marketing," i.e. door to door sales. She's starting to get pretty down on the whole thing.

I know someone who has a journalism degree and many years of experience. His job got cut three years ago as the mid-size newspaper has transitioned to a staff of low paid non-degreed reporters. He had no job for some time and now had the bright idea at nearly 50 to get a grad degree in communications and try to teach journalism instead. Which wouldn't be such a crazy notion considering that he has got adjunct jobs with no grad degree already. But he is paying for it entirely via loans--both tuition and living expenses.

FWIW...we're paying for my grad school in cash. It's why we are broke. I wouldn't be doing it with loans for anything at this age.

[misskarne]

Wow, am I the only one who had parents that expected the student to pay the majority of the college costs? My parents are big with college with my dad earning masters in business and my mom earning her masters in nursing. Both of them worked and payed for their college education so the same was expected of me. Growing up I was pretty shocked hearing about parents paying for the entire college education. I expect my kids to do the same for the majority of their college education. I mean, they'll be 18 by then, ADULTS, so they should shoulder the responsibility of paying for the majority of their education and not just have it handed to them unless they're given a full scholarship, of course.

I have to admit - and while I know my situation is totally different - that when I read stories about people whining that their parents didn't pay for college, I can't help but think, "So, get a job already!" There's nothing wrong with working at McDonald's or the local grocery store to get you through college.

[Allskate]

Wow, am I the only one who had parents that expected the student to pay the majority of the college costs?

No. My parents didn't pay for college and I started working when I was 13 and pretty much paid for everything but room, board, and medical expenses from that age. But, even though I had a fairly good sense of what a lot of things cost, I don't think I entirely realized what it would cost for me to support myself, including the cost of living in more expensive parts of the country, owning a vehicle, and paying for things like a professional wardrobe. I grew up in a family where we were constantly worried about paying the bills so I was very careful with my spending, but I just kind of assumed that I would be able to find a job after college and didn't do any research into career prospects. But, the job market was very different then.

One other thing that I think is driving up the debt load is the standard of living. I don't think most students need an Iphone and an IPad (along with associated costs) in addition to their laptops, but a lot of students have them. A lot of students don't really "need" cars, but they have them and some of them have quite nice cars even though they're taking on more debt. I'm often surprised by how much some students spend on entertainment and clothes. It adds up. But, I think some students just assume that's the way everyone is supposed to live. And others are so in debt, they figure what's a few thousand bucks more.

[misskarne]

One other thing that I think is driving up the debt load is the standard of living. I don't think most students need an Iphone and an IPad (along with associated costs) in addition to their laptops, but a lot of students have them. A lot of students don't really "need" cars, but they have them and some of them have quite nice cars even though they're taking on more debt. I'm often surprised by how much some students spend on entertainment and clothes. It adds up. But, I think some students just assume that's the way everyone is supposed to live. And others are so in debt, they figure what's a few thousand bucks more.

Ding ding ding. We have a winner.

One of my lecturers suggested that if we could afford it, we should get a smartphone. A bunch of kids in my course rushed out and bought the latest iPhone, complaining about how expensive it was. I just quietly shopped about and bought the cheapest one I could find. And it works just fine.

Heaps of kids in my course also had netbooks as well as laptops, and iPads as well as netbooks, and often went to parties and got drunk (and we all know how expensive alcohol is). And yet they were also complaining that they had no money.

[reckless]

I guess I come at this from a different perspective, having gone to the more expensive law school over full scholarships elsewhere. But the school I chose was a perfect fit for me in terms of environment and, career-wise, opened a lot of doors for me, so I have never regretted that decision. The critical question has to be what is the likely return on the investment the student is making. Sometimes, the cheaper option in not the better one.

More than a lot of careers, where you went to law school plays a huge role in opening doors. Graduates of Yale, Harvard, and Stanford may not turn out to be better lawyers than graduates of Emory, UCLA, or Indiana, but the big firms still jump at the opportunity to offer jobs to graduates from the top-tier schools. It's a big prestige issue for the firms. So if I'm talking to someone considering law school, the first question I ask is what schools we're talking about. If the student is competitive for the top-10 schools, it makes a big difference in the discussion.

Now as for the girl in the video. If she is talking about spending $120,000 to go to a lower-tier law school because she wants to go to work in politics -- but not in a position that requires legal experience -- it is a bad decision. However, there are a lot of positions that do require law degrees or, even if they do not officially require them, are very difficult to get when competing with JDs who are applying for the same job. Understanding how laws are written, how rules and regulations work, and how everything is interpreted by courts is important if your position involves drafting legislation. Even if you work for your local member of Congress, if you want to be involved in his or her committee work, that may be very legal intensive and law school might give you a background in a particular area of the law (e.g., securities, equal rights, voting laws, administrative law, etc.)

So the student in the video needs to figure out what she ultimately wants to do. Just saying "politics" is obviously uninformed. She also needs to be realistic about the odds that even law school will get her the job she wants. Jobs in Washington are hard to get, and in this economy, there is a lot of competition. If she's only going to get into a lower-tier school, law school may not help open doors. She may be better off interning for some local politicians first and make some connections. Perhaps that can get her an entry level job in Washington. At that point, if she still thinks law school is important for her career, her experience may help her get into a better school.

Then there also is an issue of how different law schools help students who seek out public interest work. Yale and Harvard have very aggressive loan forgiveness programs for public interest, so that mountain of debt is manageable. The Yale program was still fairly new when I graduated, but many of my classmates took advantage of it. So again, a lot depends on the school at issue.

Also, let's bear in mind that what a student thinks they are going to do at 21-22 may be quite different than when they graduate. I went to law school absolutely sure that I wanted to do public interest work when I graduated. During law school, I worked in multiple clinics and was involved in a lot student-litigated cases. I even had a law firm decide not to offer me a permanent job after I interned for them, because they thought I would reject the offer and do public interest work instead. To them my resume screamed public interest.

What they didn't understand is that my experiences had taught me that I did not have the stomach to do public interest work day-in and day-out. I take losing too hard and too personally. When clients of mine were deported or evicted, I felt that I had failed them. Each loss took way too much out of me and I knew I couldn't do that for a career. It may seem shallow, but the worst that happens if I lose one of my typical cases today is that a company loses money (albeit, sometimes a lot of money), but it's not life or death. I still do pro bono cases and some of them still have the kind of impact as the law school cases, but I can handle one of those cases a year or two.

All of that is a long way of saying that the girl in the video may be talking idealistically of going into politics, but after a year or two in law school, she might find that she prefers something else and her job prospects and future income are very different.

[Allskate]

I guess I come at this from a different perspective, having gone to the more expensive law school over full scholarships elsewhere. But the school I chose was a perfect fit for me in terms of environment and, career-wise, opened a lot of doors for me, so I have never regretted that decision. The critical question has to be what is the likely return on the investment the student is making. Sometimes, the cheaper option in not the better one.

I don't think anyone is saying that cheaper is always better. I certainly don't believe it and haven't said it. But, spending money -- or more money -- isn't always the wise thing. What people are saying is that some students are paying more than is necessary or wise or, worse, aren't even thinking about the debt load they are taking on and aren't even considering the job prospects. Like my friend's sister who is considering going into big debt to go to a low-tier law school that will not give her good job prospects.

And the reality is that going to a top-tier school isn't always more expensive, especially when you factor in financial aid. That's one thing that students and their parents have to educate themselves about. My parents didn't know that, and I didn't either. So, I hardly applied to any private colleges, assuming that state schools would cost me less. That turned out to be untrue and I ended up going to a top-tier private university with no more debt than if I had gone to my state university. For a lot of people, going to Harvard or Stanford isn't going to put them more in debt than going to UCLA (and especially not USC, Pepperdine, USF, etc.). Of course, in some cases, the state school will be less expensive than the private colleges that a particular student has been accepted to.

The point that I think most people are making is that students aren't giving enough thought to the amount of debt they are taking on, the consequences of that debt, and what kinds of job prospects that education will be giving them.

[TheGirlCanSkate]

For my son, he will go to a grad school with a great rep for what he wants to do, it was just less important at for the first 4 years - he is in an amazing program, has presented at different conferences across the US and is in several publications - all before his junior year.

If you can afford the top schools with a manageable amount of debt - go for it! It just all has to make sense - short and long term.

[Prancer]

That's one thing that students and their parents have to educate themselves about.

A lot of parents--including parents who went to college themselves--don't know a lot about how colleges work or what kind of aid is available, or how to go about finding it. Many of them figure that they took out student loans and it was fine, so that's what their kids will do, too.

College is so much more expensive than it used to be; kids can't put themselves through school on what they make working part time and in through the summer any more. Things have changed a lot in the past 10 years, even in just the past five years.

The point that I think most people are making is that students aren't giving enough thought to the amount of debt they are taking on, the consequences of that debt, and what kinds of job prospects that education will be giving them.

People should always go to the best school they can afford; it's just figuring out what you can afford that is the problem. Too many people don't know enough to know how to calculate what the debt will actually mean to them. Most people aren't going to get into top schools; most students aren't even going to graduate. If people think that student loan debt is bad for college graduates, imagine what it's like for the dropouts.

[manhn]

Who is serving everyone's non-fat dark chocolate mocha with no whipped cream and no foam latte? Betty White?

[reckless]

The point that I think most people are making is that students aren't giving enough thought to the amount of debt they are taking on, the consequences of that debt, and what kinds of job prospects that education will be giving them.

I definitely think that's a very valid point. However, in this thread and some of the others that have been posted on the subject, I see a lot of posts that come across as very hostile to private colleges and universities and strike me as being a bit short-sighted.

For instance, a lot of people seem to suggest that spending two years at community or junior college before transferring to another school is better than spending four years in college. I don't know how it works in other states, but in California, our two-year colleges are terrible. While some do go on to complete four-year degrees, but mostly they wind up at the lower-regarded Cal State schools, which are underfunded, overcrowded, and growing increasingly expensive. A degree from Cal State LA does not carry the same kind of respect and/or connections as a degree from USC or UCLA. The community colleges also are terrible at helping students who want to go to schools other than the big state public schools, because they don't help the student find out what courses are transferable credits. I know several kids in my extended family who could have easily gone to good four-year colleges or universities, but they went to community colleges to save money. Only one ever finished his degree.

I'm also very biased in favor of liberal arts colleges, especially ones that strongly emphasize writing. Smaller classes, learning from professors, not TAs, and having to write multiple papers and essay exams are, imo, far superior ways of learning. I'm not saying all big schools suck and all small liberal arts schools are great, but we have so many good liberal arts schools that get overlooked. They are going to be more expensive than a public university or community college, but for a lot of kids, they will provide a better education and help develop superior writing and critical thinking skills than just going to mostly lecture classes at a big university.

[made_in_canada]

I sometimes think that is why it is better to delay college, especially if you don't know precisely what you want to do, and move out and get some non-degree required job, like grocery clerk or something. Then you really see what it costs to pay rent, food etc... of course in the US it is complicated by health insurance etc, where it may be beneficial for young kids to stay at their parents place. (or in this economy, can you even get jobs like that?)

I delayed university until I was 24 and it was absolutely the best thing I could have done. I had no idea what I wanted to do right out of high school and would have just wasted a ton of money and time if I had decided to go to university right away. I had a really good grasp of a realistic budget by the time I decided to go back to school. I have more debt that I'd like but most of that is from various illnesses/injuries so c'est la vie. I know I'll have a job within a few months of graduating (it's an expanding field) and will be able to pay back my loans relatively quickly. Having said that, I can't imagine being $30-$40,000 in debt like you read about all the time.

[vesperholly]

I certainly agree that most universities are very bad at that. I remember being told about the average starter wage for a beginner journalist during the degree - about $35,000 a year. Okay, says me. Not great. But that's all right, I'll have time to save up.

What newsrooms were they polling?! If the reporters I know break $25,000 a year, they're lucky - and that's not counting the furloughs.

What they DIDN'T tell us? That FINDING a job as a beginner journalist is about as easy as going to the moon. Everyone wants two or three years of experience and almost no-one wants the graduates.

There are plenty of places to get an entry-level reporting job. You just have to move to bumfeck nowhere, get a job at the Daily Localette and slave away for $10-12/hour, though. My paper group hires lots of fresh-out-of-school grads - mostly because the turnover rate is fairly high, not because we're adding positions in any way.

[misskarne]

What newsrooms were they polling?! If the reporters I know break $25,000 a year, they're lucky - and that's not counting the furloughs.

Australian ones. Wages are higher here.

There are plenty of places to get an entry-level reporting job. You just have to move to bumfeck nowhere, get a job at the Daily Localette and slave away for $10-12/hour, though. My paper group hires lots of fresh-out-of-school grads - mostly because the turnover rate is fairly high, not because we're adding positions in any way.

The problem now is that the places in bumfeck nowhere are getting applications from journalists with ten years of experience who are getting pushed out or made redundant elsewhere. Graduates just can't compete with that.

I know of a cadetship offered with a very well-known newsroom in my city. Of course, every student in my class applied for it. It went in three stages - application, exam, one-on-one interview.

Of the 150 students in my course, only two made it to the exam. They reported back that they were up against journalists who almost had more experience in journalism than they had years alive! For a cadetship!

And the last time I made $10 an hour I was 15 years old.

[madm]

Science doesn't pay very well either, but at least PhD programs pay a stipend. One of my coworkers got a master's first though, so she's $50K in the hole for that...

Anyone getting a Master's or PhD from a public university should be able to get financial assistance in the form of a teaching or research assistanship plus a tuition waiver. I just visited one state land grant university with my daughter who wants to pursue a masters in exercise science following her undergrad degree in biology. Similar to my experience and my husband's when we went for our graduate degrees in the 1970s, universities still provide funding for graduate students in the sciences and in some of the liberal arts fields. They use graduate students to help teach the undergrad courses, thus saving the university money on teachers and also helping out the grad students. Unless you are going to a professional school, you can get a graduate degree without incurring monstrous debt. You just have to live frugally because you won't have lots of money left over for rent/food/car/etc.

Now on the other hand, my other daughter who is beginning vet school as an out-of-state student is going to have to pay a whopping $40,000 per year for tuition. There are no tuition breaks for professional students, and the workload is so heavy that she cannot work while in school. She can work during the summers though. I am just sick that she is going to be $160-200K in debt when she graduates. She is lucky to have some family money from grandparents to help pay her daily living expenses, so she doesn't have to borrow for that. It is too bad that she could not get into our state vet college where tuition would be half of this, but she didn't get in and vet school admissions are very difficult to obtain, so she had to go where she was accepted. I can only hope that her salary when she graduates allows her to pay off this debt in 10-15 years. After the first year, she will qualify to apply for some scholarships, so hopefully she'll get one!

One smart thing my vet daughter did before professional school was to work in her field for 4 years while also getting a 2-year vet tech degree from our local community college, which resulted in a vet tech certification. She figured if the vet school thing did not pan out, she could always work as a vet tech. It seems odd to me to go to community college after getting a 4-year degree in Biology, but it was smart because it gave her an employable credential in a field that's always in demand.

[Grannyfan]

My nephew graduated high school in 1989. He had planned to attend an in state college but was contacted by Columbia because of great test scores and the fact he was a decent high-jumper, and probably partly because he was from Ark. Long story short, he went to Columbia, figured out really soon he couldn't do track and keep grades so quit the track thing. By then, though, he knew he wanted to stay at Columbia. He graduated Columbia, got a law degree from Vanderbilt. Neither of those two prestigious degrees was much help in getting a job with a good law firm in NW Arkansas. He finally did, though. Today he has a happy family--and lots of debt still. I've never asked him if the Columbia experience was worth the debt, from his perspective as a 2012 father of three, but I have an idea what he'd say.

[sk8er1964]

In addition, he would want to apply to some schools (public and private in any state - but it must include some privates) where his GPA and SAT/ACT are high for that school, compared to their normal admitted student. In this way, they may throw some merit aid at him. And if he's also able to get a partial golf scholarship at that school, it might work out.

Interesting that you brought this up. We have visited one private college so far. Their tuition is $19,000 a year, but they got him down to $4,000 a year based on his GPA being high enough to meet their scholarship standards. (We have a bit of a GPA problem - that concussion he had last year killed his GPA - it's now below a 3.0. Fortunately, his ACT score was good.) Anyway, this particular university has a golf team - this year is its first full season - and partners with another private school that is a Div I school where he could take classes. I'm still very interested in this particular school, but son isn't thrilled with the golf program.

And the reality is that going to a top-tier school isn't always more expensive, especially when you factor in financial aid. That's one thing that students and their parents have to educate themselves about. My parents didn't know that, and I didn't either. So, I hardly applied to any private colleges, assuming that state schools would cost me less. That turned out to be untrue and I ended up going to a top-tier private university with no more debt than if I had gone to my state university.

I was surprised when we visited the college I mentioned above. You see that $20,000 sitcker price and go not realizing that those schools often have huge endowments and can offer more than state schools.

For instance, a lot of people seem to suggest that spending two years at community or junior college before transferring to another school is better than spending four years in college. I don't know how it works in other states, but in California, our two-year colleges are terrible. While some do go on to complete four-year degrees, but mostly they wind up at the lower-regarded Cal State schools, which are underfunded, overcrowded, and growing increasingly expensive. A degree from Cal State LA does not carry the same kind of respect and/or connections as a degree from USC or UCLA. The community colleges also are terrible at helping students who want to go to schools other than the big state public schools, because they don't help the student find out what courses are transferable credits. I know several kids in my extended family who could have easily gone to good four-year colleges or universities, but they went to community colleges to save money. Only one ever finished his degree.

In Michigan, community colleges serve two purposes. The first is to offer two-year programs that will lead directly to a job. Police academy, firefighter training, culinary schools. Some specialize in the technical fields such as electronics.

Their other purpose is to serve to prepare students to go to a four year university. It helps if you know what four-year you want to attend after community college, because if you do, your community college advisors will tailor your curriculum to match the needs of the four-year.

Wow, am I the only one who had parents that expected the student to pay the majority of the college costs? My parents are big with college with my dad earning masters in business and my mom earning her masters in nursing. Both of them worked and payed for their college education so the same was expected of me. Growing up I was pretty shocked hearing about parents paying for the entire college education. I expect my kids to do the same for the majority of their college education. I mean, they'll be 18 by then, ADULTS, so they should shoulder the responsibility of paying for the majority of their education and not just have it handed to them unless they're given a full scholarship, of course.

It took me 13 years to get through college, and another five for my masters degree. Some of it was going to school full time and working part time, some of it was working full time and going to school part time. I am fortunate that the Navy tuition assistance and GI Bill covered my tuition after my first year. I didn't start in my current field at a professional level until I was in my mid-30's. If I have the financial capability to help my son be successful earlier in his life, I will do everything that I can to help him out.

[Cherub721]

People should always go to the best school they can afford; it's just figuring out what you can afford that is the problem. Too many people don't know enough to know how to calculate what the debt will actually mean to them. Most people aren't going to get into top schools; most students aren't even going to graduate. If people think that student loan debt is bad for college graduates, imagine what it's like for the dropouts.

Agreed. The question then become what does "afford" mean. If someone has to take on debt for something, the argument can be made that they can't afford it, especially since they'll be students and making little to no income to cover it. You can do all kinds of research about what types of jobs you might get and what you're living expenses might be, but it's all just projections. You could have to take leave to take care of sick family member, you could become disabled, you could fall in love and end up living in a state with lower paying jobs, you could unexpectedly have a kid and your living expenses double, etc. Your debt will still be there, though. I just think a lot of people have too blase of an attitude about debt.

There's of people who did the right things, took on massive debt to go to the prestigious law schools, covered their living expenses with student loans (all those fancy interview suits), got hired by the big firms, and then got laid off from their first jobs.

I can't even tell you how many people I know who interned for free, as licensed attorneys, sometimes for a year or more, just to get experience. Some of them are from pretty good schools. Some of them are deferred from law firms and receiving stipends, but the stipends are like 1/3 of what they expected to make.

I understand the POV that reckless has, and indeed prestige is important in the legal world, but I'm glad to have the peace of mind that comes from not having debt because I went to a slightly less prestigious school. It gave me the flexibility to move toward public interest work instead of working for a law firm, which was never my interest. Of course, sometimes I wish I made more money, but there's no guarantee that would've happened and I'm risk-averse.

[Karina1974]

Ding ding ding. We have a winner.

One of my lecturers suggested that if we could afford it, we should get a smartphone. A bunch of kids in my course rushed out and bought the latest iPhone, complaining about how expensive it was. I just quietly shopped about and bought the cheapest one I could find. And it works just fine.

I paid just $161 for my Galaxy S2, after factoring in a $250 rebate that expired a week after I got the phone, so I bought it just in time. I was at the prices Sprint was charging for the iPhones at the time (early July); of course, the prices have dropped since with the iPhone5 coming out now. With the 3G fast enough for my satisfaction (I rarely download videos or other large media files)

Because I got the smartphone, I actually decided a week ago to disconnect my Road Runner - it's nice to have a utility bill that is only $11/month (for TW's Basic Cable) and no one needs more than one Internet connection. Or 100+ cable channels either. I'll be putting the $$ I save by doing that towards my Discover bill and, when that finally gets paid off, it will be "cash on the barrel" for me except for something like a car repair.