Author Topic: Overhead at Graduation Parties  (Read 14409 times)

ltt

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Overhead at Graduation Parties
« on: May 08, 2016, 05:42:10 AM »
We were at a graduation party for a college grad this weekend.  The graduate, a young woman in her early 20s who majored in theatre, was opening a small gift and mentioned that she was $70,000 in debt from college.  My mouth dropped opened---really, it did.  Her mom turned to me and basically said, "Yes, and a few others (must have been friends of her daughters) had $120,000 to $140,000 of debt."  The reason I was so stunned is because the daughter went to a community college for two years and lived at home and then transferred to a state school for two years.  There must have been no savings prior to college.

Also, the daughter is leaving for a two-week trip to Europe this week.  Shrug.......

paddedhat

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Re: Overhead at Graduation Parties
« Reply #1 on: May 08, 2016, 08:37:22 AM »
Can't even imagine the out of control spending there. Our daughter recently did something similar and the community college portion of the bill was under $4k for the year. The state school was about $16K  a year. Unless things are priced very differently in your state,  $70K is insane, borrowed or not.

Sibley

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Re: Overhead at Graduation Parties
« Reply #2 on: May 08, 2016, 10:17:31 AM »
My sister is in grad school, and I recently found out how much SL debt she expects to graduate with. $260k. With what she wants to do, she'll be working for the Fed gov or nonprofits and will qualify for whichever forgiveness program it is. Ouch.

fattest_foot

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Re: Overhead at Graduation Parties
« Reply #3 on: May 08, 2016, 11:48:08 AM »
On the plus side, she'll be able to pay off that debt in no time with a theater degree. So that's good...

JZinCO

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Re: Overhead at Graduation Parties
« Reply #4 on: May 08, 2016, 12:30:28 PM »
Can't even imagine the out of control spending there. Our daughter recently did something similar and the community college portion of the bill was under $4k for the year. The state school was about $16K  a year. Unless things are priced very differently in your state,  $70K is insane, borrowed or not.
Yeah but I could see the daughter making $10K/yr easily over those 4 years, dropping said debt to 30K.

Also, who pays sticker price for a college? Where I did my undergrad the university covers about 40% of tuition for the average student.
During my 3 years there, I paid a total of $14K instead of the $42K sticker price (Is $56K 8 yr later) for tuition + fees due to grants and scholarships. I was also able to cover essentials (housing + beer). I had no idea what I was doing, did not budget and just lived one semester at a time but was able to leave college with the same net worth as I had entered. With a bit of planning and advice from parents I can imagine students getting through school without taking on much debt.
« Last Edit: May 09, 2016, 12:26:13 PM by JZinCO »

infogoon

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Re: Overhead at Graduation Parties
« Reply #5 on: May 09, 2016, 12:14:47 PM »
Public universities have lower tuition, but a lot of students want to live on campus for "the college experience" and that's what really drives up the loan balances.

I'm a red panda

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Re: Overhead at Graduation Parties
« Reply #6 on: May 09, 2016, 12:26:53 PM »
Can't even imagine the out of control spending there. Our daughter recently did something similar and the community college portion of the bill was under $4k for the year. The state school was about $16K  a year. Unless things are priced very differently in your state,  $70K is insane, borrowed or not.
I wouldn't find that unreasonable for a private school.

She also needed a place to live and food to eat.

And probably a number of spring break cruises, fancy clothes, etc.

NESailor

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Re: Overhead at Graduation Parties
« Reply #7 on: May 09, 2016, 12:33:45 PM »
I had no idea what I was doing, did not budget and just lived one semester at a time but was able to leave college with the same net worth as I had entered. With a bit of planning and advice from parents I can imagine students getting through school without taking on much debt.

Exactly the same experience.  Started with 0, graduated with about 0 NW...but with a degree in Accounting, a signed job offer and signing bonus.  I had 2 weeks off between graduation and "the real world".

Jim2001

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Re: Overhead at Graduation Parties
« Reply #8 on: May 09, 2016, 08:19:05 PM »
On the plus side, she'll be able to pay off that debt in no time with a theater degree. So that's good...

You beat me to the punch(line)!

Ann

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Re: Overhead at Graduation Parties
« Reply #9 on: May 09, 2016, 11:34:48 PM »
Public universities have lower tuition, but a lot of students want to live on campus for "the college experience" and that's what really drives up the loan balances.

My own personal experience is skewed.  It took me a while to appreciate that it was atypical.  I stayed in the dorms (except summers) because it WAS significantly cheaper than any apartment I could find.  Granted, that was because it was the last unair-conditioned dorm left.  This was in Texas.

What bothers me is that some universities REQUIRE dorm students to buy a meal plan.  Thankfully, not mine.  After the first semester, I realized I could eat MUCH cheaper than $5-7 a meal.

MrsPete

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Re: Overhead at Graduation Parties
« Reply #10 on: May 10, 2016, 11:26:54 AM »
Also, who pays sticker price for a college? Where I did my undergrad the university covers about 40% of tuition for the average student.
Pretty much everyone pays "sticker price".  The concept of the university "covering" a portion of the tuition doesn't happen here.  But then, we have literally the lowest priced state schools in the country, so it's not like they need to incentivize the prices. 

onlykelsey

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Re: Overhead at Graduation Parties
« Reply #11 on: May 10, 2016, 11:28:55 AM »
Public universities have lower tuition, but a lot of students want to live on campus for "the college experience" and that's what really drives up the loan balances.

My own personal experience is skewed.  It took me a while to appreciate that it was atypical.  I stayed in the dorms (except summers) because it WAS significantly cheaper than any apartment I could find.  Granted, that was because it was the last unair-conditioned dorm left.  This was in Texas.

What bothers me is that some universities REQUIRE dorm students to buy a meal plan.  Thankfully, not mine.  After the first semester, I realized I could eat MUCH cheaper than $5-7 a meal.

We were required to our freshman year, as well!  Swindlers.  I'm sure there would otherwise have been some portion of the freshmen suffering from malnutrition, though, so I guess it makes sense.

JZinCO

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Re: Overhead at Graduation Parties
« Reply #12 on: May 10, 2016, 11:49:02 AM »
Also, who pays sticker price for a college? Where I did my undergrad the university grants and scholarships cover about 40% of tuition for the average student.
Pretty much everyone pays "sticker price".  The concept of the university "covering" a portion of the tuition doesn't happen here.  But then, we have literally the lowest priced state schools in the country, so it's not like they need to incentivize the prices.

I'd be interested in hearing more. Where is here?

I did misspeak (see correction) but I do not think that pretty much everyone pays sticker price. In my case, tuition was heavily subsidized by competitive scholarships (not grants); this was at a uni ranked second for price to education value (e.g. a good 'buy'). In-state tuition+fees were $5,000 a year (is almost $7,000 now) (before that 40% discount).

 I now work at another university (tuition+fees are ~$7,000). Here, students on average receive an effective tuition discount of 37% from grants and scholarships. Even students in "the 1% of income" families still receive an average $100 discount.
« Last Edit: May 10, 2016, 11:50:52 AM by JZinCO »

runningthroughFIRE

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Re: Overhead at Graduation Parties
« Reply #13 on: May 10, 2016, 12:56:41 PM »
At the (state/public) university I attended, undergraduate tuition+fees were a little over $9,000.  I honestly haven't a clue how much I actually paid when I lived off-campus, but I do know it was less than when I was stuck in the dorms my freshman year when room/board/meal plan was ~9,000 as well.  I got a graduate degree and tuition skyrocketed in the last year, but all told my expenses were ballpark $60-65K after scholarships.  As for the sticker price debate, I scored several points higher on the ACT than the average student admitted that year (as a proxy for where I might have wound up on the merit scholarship spectrum) and recieved ~30% of my tuition in scholarships.

I can certainly believe people rack up debt like this, even at public schools, but to me that implies no assistance from parents and not working at all through college.

clarkfan1979

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Re: Overhead at Graduation Parties
« Reply #14 on: May 10, 2016, 05:28:43 PM »
We were at a graduation party for a college grad this weekend.  The graduate, a young woman in her early 20s who majored in theatre, was opening a small gift and mentioned that she was $70,000 in debt from college.  My mouth dropped opened---really, it did.  Her mom turned to me and basically said, "Yes, and a few others (must have been friends of her daughters) had $120,000 to $140,000 of debt."  The reason I was so stunned is because the daughter went to a community college for two years and lived at home and then transferred to a state school for two years.  There must have been no savings prior to college.

Also, the daughter is leaving for a two-week trip to Europe this week.  Shrug.......

I think it all depends. They will probably struggle to pay it back, but maybe not. One of my really good friends went to art school and got a degree in graphic design. I'm guessing he took out 50K to 75K in loans, but I'm not exactly sure. I know his parents didn't give him any money and he told me how much loans he took out his first year. I just multiplied that number by 4 years.

After two years of free lancing, he ended up working for advertising agencies and now makes 150K/year in salary at 37 years old and another 50K/year flipping houses on the side. I think his degree in graphic design helps him with the flips. He also doesn't live in a crazy expensive city. I would say average.

russianswinga

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Re: Overhead at Graduation Parties
« Reply #15 on: May 10, 2016, 05:47:23 PM »
Just for shits and giggles I googled the tuition costs at UC San Diego, where my daughter (may) go in 16 years :)
What surprised me is their estimate for "living with parents". I'm sorry, but if I had a kid living with me my whole life, I don't put her "housing and meals" in a separate budget. I understand her allowance for eating out on occasion, etc, and them wanting to compare apples to apples, but I don't believe housing and meals while living with parents is correctly calculated here.


jorjor

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Re: Overhead at Graduation Parties
« Reply #17 on: May 10, 2016, 09:46:51 PM »
Public universities have lower tuition, but a lot of students want to live on campus for "the college experience" and that's what really drives up the loan balances.

My own personal experience is skewed.  It took me a while to appreciate that it was atypical.  I stayed in the dorms (except summers) because it WAS significantly cheaper than any apartment I could find.  Granted, that was because it was the last unair-conditioned dorm left.  This was in Texas.

What bothers me is that some universities REQUIRE dorm students to buy a meal plan.  Thankfully, not mine.  After the first semester, I realized I could eat MUCH cheaper than $5-7 a meal.

We were required to our freshman year, as well!  Swindlers.  I'm sure there would otherwise have been some portion of the freshmen suffering from malnutrition, though, so I guess it makes sense.

We were required to stay on campus through our Junior year, expensive meal plan requirements and all. Silly me, choosing a small private school. I "only" came out with about $20k in debt though...

MrsPete

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Re: Overhead at Graduation Parties
« Reply #18 on: May 11, 2016, 11:25:44 AM »
I'd be interested in hearing more. Where is here?
Deep South; that's specific enough for the internet. 

My daughter's tuition and fees at a state school are just over $3400 per semester.  That includes book rental, athletic fees, health services fees, and all those little piddly things -- not housing and meals, just tuition and fees.  But aside from a few school-based scholarships, the school doesn't discount tuition for anyone.   

PhysicianOnFIRE

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Re: Overhead at Graduation Parties
« Reply #19 on: May 11, 2016, 11:49:15 AM »
Public universities have lower tuition, but a lot of students want to live on campus for "the college experience" and that's what really drives up the loan balances.

Maybe the definition has changed, but I thought the "college experience" meant eating ramen and frozen pizza, sharing a crappy apartment with several roommates, road tripping for vacations, and drinking cheap beer.

I can understand a study abroad experience, and maybe some travel to a bowl game or March Madness trip, but I don't recall too many college experiences that would've broken the bank.
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itchyfeet123

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Re: Overhead at Graduation Parties
« Reply #20 on: May 11, 2016, 11:54:14 AM »
Can't even imagine the out of control spending there. Our daughter recently did something similar and the community college portion of the bill was under $4k for the year. The state school was about $16K  a year. Unless things are priced very differently in your state,  $70K is insane, borrowed or not.

Your numbers actually seem to match the numbers in the OP.  Assuming four years to graduate, tuition alone would be $40k.  It's not clear from the OP, but if the student moved from living at home to living in a dorm or sharing an apartment when she transferred to state school, then $30k living costs for two years, while not particularly Mustachian, is hardly absurd.  UT Austin, for example, quotes living costs as $16,516/year, and that's excluding summer.

Just for shits and giggles I googled the tuition costs at UC San Diego, where my daughter (may) go in 16 years :)
What surprised me is their estimate for "living with parents". I'm sorry, but if I had a kid living with me my whole life, I don't put her "housing and meals" in a separate budget. I understand her allowance for eating out on occasion, etc, and them wanting to compare apples to apples, but I don't believe housing and meals while living with parents is correctly calculated here.

But if instead of going to college daughter got a job and moved out, presumably your household grocery bill would decrease by some amount (which may or may not be close to the amount estimated by UC San Diego).
« Last Edit: May 11, 2016, 12:01:36 PM by itchyfeet123 »

mtn

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Re: Overhead at Graduation Parties
« Reply #21 on: May 11, 2016, 12:12:06 PM »
Not that surprising.

Loans are often too easy to get too much of. They basically just deposit a check into the bank account and don’t pay attention to where it is going after that (there are exceptions of course). I know my wife got a check one semester that was way more than her room and board and tuition put together. Luckily she was smart enough to pay down principal rather than blow it on fun.


Secondly, the cost of housing (at least at my alma mater) is getting ridiculous. First, they require you to live on campus for 2 years AND purchase a meal plan. I can’t remember the exact figures, but I think that if you worked it out to the time you were actually allowed to live in the dorm (no summer) it was about $700 a month to share a dorm room, and with the cheapest meal plan I could buy I could have eaten out every day for $27 and been ahead. There was really no getting around it unless you lived within 45 miles of the place. After that (and this is not the schools fault) you got to move into off campus apartments. I struggled to find a room in a 4 bedroom place for less than $500 a month (utilities included). Looking back, I should have asked my dad to buy a house and pay him double his mortgage and insurance in rent—then rented out another room to someone for the same. Nowadays, all the apartments are getting ridicoulously swanky and expensive so that even the dumps like I lived in are expensive. This is eventually going to burst as they’ll have more housing than students, but until then it is hard to keep it cheap and live biking distance to campus.

JZinCO

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Re: Overhead at Graduation Parties
« Reply #22 on: May 11, 2016, 12:18:37 PM »
I'd be interested in hearing more. Where is here?
Deep South; that's specific enough for the internet. 

My daughter's tuition and fees at a state school are just over $3400 per semester.  That includes book rental, athletic fees, health services fees, and all those little piddly things -- not housing and meals, just tuition and fees.  But aside from a few school-based scholarships, the school doesn't discount tuition for anyone.   
I think there's a disconnect here. Originally I wrote 'university' since almost all of my grants and scholarships came from my specific department and college. But in my reply I broadened to all grants and scholarships (e.g. Pell). I'd safely wager that a third to a half of the students at your school receive significant sums from all sources of scholarships and grants.

MrsPete

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Re: Overhead at Graduation Parties
« Reply #23 on: May 11, 2016, 04:09:15 PM »
I'd be interested in hearing more. Where is here?
Deep South; that's specific enough for the internet. 

My daughter's tuition and fees at a state school are just over $3400 per semester.  That includes book rental, athletic fees, health services fees, and all those little piddly things -- not housing and meals, just tuition and fees.  But aside from a few school-based scholarships, the school doesn't discount tuition for anyone.   
I think there's a disconnect here. Originally I wrote 'university' since almost all of my grants and scholarships came from my specific department and college. But in my reply I broadened to all grants and scholarships (e.g. Pell). I'd safely wager that a third to a half of the students at your school receive significant sums from all sources of scholarships and grants.
Yeah, we're not on the same page.  I thought you were talking about the school (college or university) discounting its price -- in my experience very few scholarships come from the school itself.  Pell grants come from the federal government. 

BTDretire

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Re: Overhead at Graduation Parties
« Reply #24 on: May 11, 2016, 05:57:14 PM »
On the plus side, she'll be able to pay off that debt in no time with a theater degree. So that's good...

  No, didn't you read up page, it's going to be forgiven, er, I mean the hard working tax payers get to pay for it.

sheepstache

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Re: Overhead at Graduation Parties
« Reply #25 on: May 11, 2016, 06:43:01 PM »
Public universities have lower tuition, but a lot of students want to live on campus for "the college experience" and that's what really drives up the loan balances.

My own personal experience is skewed.  It took me a while to appreciate that it was atypical.  I stayed in the dorms (except summers) because it WAS significantly cheaper than any apartment I could find.  Granted, that was because it was the last unair-conditioned dorm left.  This was in Texas.

What bothers me is that some universities REQUIRE dorm students to buy a meal plan.  Thankfully, not mine.  After the first semester, I realized I could eat MUCH cheaper than $5-7 a meal.

We were required to our freshman year, as well!  Swindlers.  I'm sure there would otherwise have been some portion of the freshmen suffering from malnutrition, though, so I guess it makes sense.

Part of it is budgeting for the school. They're still paying off mortgage/construction costs on the dorms and can't afford vacancy (and having residency rules in place might have been a requirement of getting the loan, sort of like how it's sometimes easier to get a loan for a rental property with a good record of income or tenants already in place).

Similarly for the food plan, the contract with the cafeteria service (probably Aramark or Chartwells) may stipulate that the school has to guarantee a minimum level of income for the service. At least this is my experience with an education institution in the city, where there are a lot of competing places to eat. With a limited audience (security concerns dictating that the general public can't eat in the cafeteria), the cafeteria can't offer competitively priced goods, which would then result in even fewer students eating there if they had a choice. And then heck once you have that captive audience, what's a little price gouging?

Pigeon

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Re: Overhead at Graduation Parties
« Reply #26 on: May 11, 2016, 07:56:51 PM »
Room, board and tuition at my state's public colleges and universities runs about $23 K/ year.  There is almost no merit aid, period.  If the student took loans for community college tuition, and need a car to commute I could see where the $70K comes in.  It could certainly have been done more economically, but it's not that terribly unusual.

The travel is insane.

mbk

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Re: Overhead at Graduation Parties
« Reply #27 on: May 11, 2016, 09:04:43 PM »
Not that surprising.

Secondly, the cost of housing (at least at my alma mater) is getting ridiculous. First, they require you to live on campus for 2 years AND purchase a meal plan. I can’t remember the exact figures, but I think that if you worked it out to the time you were actually allowed to live in the dorm (no summer) it was about $700 a month to share a dorm room, and with the cheapest meal plan I could buy I could have eaten out every day for $27 and been ahead. There was really no getting around it unless you lived within 45 miles of the place. After that (and this is not the schools fault) you got to move into off campus apartments. I struggled to find a room in a 4 bedroom place for less than $500 a month (utilities included). Looking back, I should have asked my dad to buy a house and pay him double his mortgage and insurance in rent—then rented out another room to someone for the same. Nowadays, all the apartments are getting ridicoulously swanky and expensive so that even the dumps like I lived in are expensive. This is eventually going to burst as they’ll have more housing than students, but until then it is hard to keep it cheap and live biking distance to campus.
I concur this. When I was doing a postdoc at a university 3 years ago, all the nearby housing is expensive apartment style designed for students. The typical rent was $550-$1000/student in a 4+ bedroom apartment with full year contract. And the area surrounding the college was spread out and was not conducive to biking/walking with bad roads and no shoulders. The college used to run lot of shuttles to nearby apartments.  I said to myself fuck that and went far away from campus to find a shared house (with another house-mate) for $350 including utilies and internet. The house was big (1500+ sq ft) with nice deck. I started taking public transport with monthly pass of $30.

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Re: Overhead at Graduation Parties
« Reply #28 on: May 12, 2016, 11:18:19 AM »
This wasn't overheard at a graduation party, but more so the dinner table last weekend.  But it applies to the topic.

I spent last Sunday  with my in laws.  My sister in law and her husband decided to cook  us all supper and have a dinner party. We got on the subject of my sister in law's husband's family and what they are all up to these days. He started talking about his brother, who is now 31, and doing a residency for medical school (which he has 3 years left of!) Not only will he be almost 35 when he is done with all of his schooling and training, but he will graduate with nearly  $800,000 in student loans!!! How is that even possible?!?! I understand that there are loan forgiveness programs out there if you work for a particular company for so long, but would they really pay off this much?

Miss Piggy

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Re: Overhead at Graduation Parties
« Reply #29 on: May 12, 2016, 11:57:55 AM »
...but he will graduate with nearly  $800,000 in student loans!!!

Holy shit. I can't even...

JZinCO

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Re: Overhead at Graduation Parties
« Reply #30 on: May 12, 2016, 11:58:08 AM »
This wasn't overheard at a graduation party, but more so the dinner table last weekend.  But it applies to the topic.

I spent last Sunday  with my in laws.  My sister in law and her husband decided to cook  us all supper and have a dinner party. We got on the subject of my sister in law's husband's family and what they are all up to these days. He started talking about his brother, who is now 31, and doing a residency for medical school (which he has 3 years left of!) Not only will he be almost 35 when he is done with all of his schooling and training, but he will graduate with nearly  $800,000 in student loans!!! How is that even possible?!?! I understand that there are loan forgiveness programs out there if you work for a particular company for so long, but would they really pay off this much?
I'd have to take out a loan just to pay for that tax bill.

dandarc

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Re: Overhead at Graduation Parties
« Reply #31 on: May 12, 2016, 12:13:28 PM »
...but he will graduate with nearly  $800,000 in student loans!!!

Holy shit. I can't even...
Professional student before deciding to become a doctor, I'm guessing.  Keep those loans in deferment by going to grad school.  Multiple times!