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re: College Savings questions for those living the reality now
Posted on 5/31/22 at 8:12 pm to concrete_tiger
Posted on 5/31/22 at 8:12 pm to concrete_tiger
Thanks, folks. Reality set in this weekend on how close we are to this. Time flies.
This post was edited on 5/31/22 at 8:13 pm
1
Posted on 5/31/22 at 9:48 pm to concrete_tiger
If you don’t mind me asking, what funds are you using to invest in and what is your rate of return estimate (i.e. 6%)? Are you target funding?
Posted on 5/31/22 at 10:14 pm to concrete_tiger
Simple answer is yes. My son is at LSU because he won the Presidents alumni scholarship which is full cost of attendance. Otherwise the top scholarship is 4K plus TOPS - basically covers half the cost.
If you’re looking OOS don’t expect much regardless of ACT etc. Of course there are exceptions and Private school costs are based on need. If your kids are going to graduate school then it really makes sense to stay in state, take advantage of TOPS and then spend the money on grad school. Hope this helps.
If you’re looking OOS don’t expect much regardless of ACT etc. Of course there are exceptions and Private school costs are based on need. If your kids are going to graduate school then it really makes sense to stay in state, take advantage of TOPS and then spend the money on grad school. Hope this helps.
Posted on 5/31/22 at 10:39 pm to concrete_tiger
In Louisiana?
If so, look at Ul-L and ULM closely.
Those two schools try to get incoming freshmen every dollar they can.
LSU and LaTech admissions are really poor quality.
If so, look at Ul-L and ULM closely.
Those two schools try to get incoming freshmen every dollar they can.
LSU and LaTech admissions are really poor quality.
Posted on 5/31/22 at 10:42 pm to KillTheGophers
quote:
ULM
But then you have to go to ULM
quote:
LSU and LaTech admissions are really poor quality.
What do you mean by this?
Posted on 6/1/22 at 2:10 am to I Love Bama
quote:
My brother learned coding for free online/youtube and makes $250,000 a year. No degree.
Most people who don't have a degree make nowhere close to $250k a year.
Having a degree still matters.
My firm doesn't hire anyone for investment positions unless they have a degree. Some of the receptionists and auxiliary staff don't have a degree but their compensation is far, far lower than anyone in an investment seat. I'm not saying that my firm's salaries are representative of the average college graduate but each fund manager took home at least $1.2m.
Obviously, going to the right institution helps massively. Going to Harvard is obviously much, much better than going to a lesser ranked state school.
This post was edited on 6/1/22 at 2:13 am
Posted on 6/1/22 at 2:17 am to Ladadof3
I strongly disagree with this.
My experience is college brand absolutely matters.
If your kids can get into an ivy, it's 100% worth it even if you get no financial aid. The friend I have who went to Harvard gets so many opportunities that most ordinary state school graduates don't. Hedgefunds, venture capital firms, every single prestigious firm I can think of recruits there.
There are firms that recruit nowhere else. The benefit of going to Harvard/ivy is on-campus recruiting, which means your application is separated from the crowd. Undergrad institution matters a lot.
My experience is college brand absolutely matters.
If your kids can get into an ivy, it's 100% worth it even if you get no financial aid. The friend I have who went to Harvard gets so many opportunities that most ordinary state school graduates don't. Hedgefunds, venture capital firms, every single prestigious firm I can think of recruits there.
There are firms that recruit nowhere else. The benefit of going to Harvard/ivy is on-campus recruiting, which means your application is separated from the crowd. Undergrad institution matters a lot.
Posted on 6/1/22 at 5:46 am to concrete_tiger
quote:
I’d love for them to get scholarships and this be a nest egg for when they get started in life.
Can you speak to how this would work in the case of a 529?
Say child doesn't use the full 80k I put away for them and 30k remains. What are the options to get that money out of a 529 and directly do them?
Posted on 6/1/22 at 6:00 am to DiscountedCashFlow
quote:
If your kids can get into an ivy, it's 100% worth it even if you get no financial aid.
Sure, an Ivy League school may be worth it, but we're largely talking about Louisiana in state options here.
The difference between Harvard and ANY Louisiana institution is life altering, but the different between the Louisiana institutions is negligible.
Posted on 6/1/22 at 6:05 am to thegreatboudini
As an LSU grad that has moved out of state I would send my kids to La Tech if we still lived in LA. Pretty good school and I would feel better about them living in Ruston as opposed to Baton Rouge while attending college.
Posted on 6/1/22 at 8:25 am to concrete_tiger
Look at schools with auto merit scholarships.
UK, for instance, has free tuition with a 31 or something on ACT
UK, for instance, has free tuition with a 31 or something on ACT
Posted on 6/1/22 at 8:30 am to DiscountedCashFlow
quote:
My experience is college brand absolutely matters.
In my opinion (and experience), the individual context matters greatly, more so than blanket (college brand statements). For example, who you are at 18yo matters more than the college letters on your sweater at 22yo.
Ivy schools and other elites (eg, Duke, Univ of Chicago, Berkeley, Michigan, UnC Chapel Hill) matter and are highly probable game changers. Don’t get me wrong.
But there are a swath of them that point to US News rankings to toot their horn, whose brand difference can be washed away with a student’s DNA / personality, etc or do not consider positive DNA traits that can be found in many students in “lesser” than colleges.
I am proof on both ends of university brand (hood degrees from elite and lesser than universities) and here to tell you to knifevthrough most of that BS.
Posted on 6/1/22 at 8:42 am to thegreatboudini
quote:
the different between the Louisiana institutions is negligible.
Ehh, I wouldn't agree with that. How many Nichols or Mcneese or ULM grads are going on to work at hedge funds in New York City? Even from just an accounting perspective, the Big 4 really only recruits LSU.
That's not a life changing job, but it is a $100k before you're 30 job, and they are coming almost exclusively from LSU.
Posted on 6/1/22 at 9:34 am to concrete_tiger
2 under 5 and we are targeting $150k, when they are in HS we will adjust out target accordingly. Our hopes are to cover the first 5 years as that's what my wife's parents did for her. Mine made me fund my own, and while manageable the stress of knowing it there weighed on me early in my career.
Personally, I think college costs are going to continue to grow as the focus is not on the root cause. IMO, public colleges have no incentives to decrease overhead costs. They are bloated with administrative people, several making 6 figures. They have more and more professors making hefty salaries, and many are teaching fewer classes. And the solutions so far have been gov't guaranteed loans that are essentially guaranteed and having the taxpayers pay a portion of the balance. If the politicians really wanted to address student loan debt, they should be focusing on the universities costs and addressing tuition rates.
quote:
Do we think college costs are going to level off with all the "loan forgiveness" talks these days, or will they continue to skyrocket?
Personally, I think college costs are going to continue to grow as the focus is not on the root cause. IMO, public colleges have no incentives to decrease overhead costs. They are bloated with administrative people, several making 6 figures. They have more and more professors making hefty salaries, and many are teaching fewer classes. And the solutions so far have been gov't guaranteed loans that are essentially guaranteed and having the taxpayers pay a portion of the balance. If the politicians really wanted to address student loan debt, they should be focusing on the universities costs and addressing tuition rates.
Posted on 6/1/22 at 9:42 am to thegreatboudini
quote:
Can you speak to how this would work in the case of a 529?
Say child doesn't use the full 80k I put away for them and 30k remains. What are the options to get that money out of a 529 and directly do them?
You can always just eat the 10% penalty and transfer the rest. Other options would be to study the non-tuition costs to see if there is anything there you can use to pull the funds to cover. You should know early on if you're going to have trouble using the full $80k. I also know Trump expanded the things you can use the funds for, but don't know the specific details.
Another option could be to transfer the balance to your other kids, and then pay the equivalent to the child that doesn't use the funds through other means; although that $30k may be too extreme to figure out how to pay it.
Posted on 6/1/22 at 10:07 am to Mingo Was His NameO
quote:
How many Nichols or Mcneese or ULM grads are going on to work at hedge funds in New York City? Even from just an accounting perspective, the Big 4 really only recruits LSU.
All of this. Those regional Louisiana state schools aren't going to take you as far as a LSU or a Tulane. LinkedIn is great for this research. You can search for employees at top firms/companies and filter on the school they attended.
Posted on 6/1/22 at 11:12 am to good_2_geaux
quote:
If you don’t mind me asking, what funds are you using to invest in and what is your rate of return estimate (i.e. 6%)? Are you target funding?
FGPGX
FBCIX
I project 6-7% as you state, but have seen +10% over the life of the investment, and that includes the current dive.
We didn't start these on day one - I wish I had been that smart. We seeded the account and projected out based on 7% return what would it take to have $80k by age 19 or 20.
Many kids we know (family included) are enrolling as sophomores, I am hoping we get a year for free while in high school.
I also started basic savings accounts for each and put some in there each month with a goal to help with a car. I grew up on a farm and could earn cash from the time I was able to work, but we live in the suburbs where the chance for decent income as a kid isn't great, although I did send the 14 year old to work on the farm this summer! Of course, I didn't anticipate the car market going insane.
I am by no means claim to know what I am doing, I am just trying to avoid big debt later on for any of us.
Posted on 6/1/22 at 11:50 am to thegreatboudini
quote:
Can you speak to how this would work in the case of a 529?
Say child doesn't use the full 80k I put away for them and 30k remains. What are the options to get that money out of a 529 and directly do them?
Others here are more knowledgeable, but here's what I know
- if you get a scholarship, you are able to withdraw that amount without penalty (you still pay taxes)
- we can move the unused portion to our other kids
- we can withdraw with penalty
It would make too much sense to let these just convert into an IRA
Posted on 6/1/22 at 2:46 pm to DiscountedCashFlow
If you're going into finance and other investment businesses, this is true. If you're going into other industries, it really doesn't matter that much.
I'm in engineering in O&G.
I'm in engineering in O&G.
Posted on 6/1/22 at 3:18 pm to b-rab2
Industry matters - true! The Individual’s context (such as industry desired, personal strengths, leadership potential, etc) > universal statements about college brand names in most cases, in my experience.
(excluding the Ivy and elite of elite brand names, most of the time)
(excluding the Ivy and elite of elite brand names, most of the time)
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