10 Things You Need to Know If Your Kid’s Applying for College

Some mostly good advice from Yahoo! Finance:

1.  Set a budget.

Be upfront with your child about how much money you can contribute to their education (this number should be close to $0) and have them decide ahead of time how much debt they’re willing to go into over the course of their degree (this number should also be close to $0). To help them arrive at this number, have them look at the entry-level salaries in the job(s) that they’ll be qualified for after they graduate and compare that to the monthly student loan payment that they can expect to owe. Help them to consider the longer-range effect student loans could have on their finances over their lifetime

2. Ignore the sticker price and look at the actual cost.

I don’t have a quote here because the article’s reasoning is balderdash.  And if you don’t know what balderdash means, your kid probably shouldn’t be going to college.

3. The school doesn’t matter as much as you think.

While the top 20 schools provide students with opportunities that they wouldn’t have had otherwise (please.  Biff and Buffy would have more opportunities no matter where they went), the difference between the earning potential of a student from many other four-year universities is often pretty marginal.

True.  And the top schools for your child’s major may not be in the Ivy League.  You’ve probably never even heard of a top school like Cooper Union.  And let’s not forget that many CEO’s got their undergraduate degree at the School of Hard Knocks.

4. Debt could sidetrack your kid’s life.

With the mounting costs of getting a college degree, students have taken on increasingly higher student loan debts. Add into the mix the fact that young people are experiencing higher than usual unemployment and underemployment upon graduation and you have a recipe for trouble.

These significant debts appear to be keeping some young people from taking important life steps such as moving out on their own, getting married, going to graduate school, buying a home and having kids.

But on the other hand, they do have $600 to spend on the latest iPhone so they can SnapChat naked photos to each other.

5. Think twice before taking out a loan.

But should you be taking out or co-signing a loan to finance your child’s education?

Probably not. If you don’t have the money to give to your child it’s probably because you can’t afford to help. A monthly loan payment to finance your child’s education could put your budget into a tailspin and compromise your retirement. You might also put your house at risk.

Good lord.  Re-read #4 above, and substitute ‘your life’ for ‘your kid’s life’.  Don’t ever go in debt for your kids, especially not for their college ‘education’.

6. You shouldn’t compromise your retirement.

If you haven’t been saving for your retirement, or if you have debt that you need to pay off, then putting your money toward your child’s schooling isn’t the best choice.

Nope.  Don’t take out loans, and don’t waste the money you worked so hard for.

7. Living at home is the best advice.

According to College Board, the average cost of room and board in 2013-2014 was $9,498 a year for a public four-year school and $10,823 a year for a private non-profit four year school. Multiply that by four and that adds up to a lot of money.

Yep.  That’s where a lot of schools make some serious money, because many dorms are paid off.  It’s pure profit.

8. You need to have a money talk.

This talk is equally as important to have, but often forgotten. When I first went off to college, I knew nothing about budgets or how to live frugally. I had to learn that on my own and made some costly mistakes.

The best way for kids to learn is to talk to them about how you budget and manage money.

You should have had this talk with your kids when they were 5.  If they reach college age and don’t know this stuff, you have failed as a parent.  And if they best way for kids to learn is to talk to people, why do they need to move away and spend $20,000 a year in college?

9. You need to teach them life skills. 

Teach them to cook, do laundry, take public transit or change a flat tire, grocery shop and bank themselves.

Consider giving them the responsibility to buy food on a limited budget and cook for the family one night a week.

Once again, you should have trained your kids to do this by now.  If your kid is old enough to apply for college and you have yet to teach them these life skills, it’s too late.  And once again you have failed as a parent.

10. Scholarships make a huge difference.

It’s not just the top students who win scholarships. All students should be applying for scholarships, as they are an important source of extra money for your schooling. Have your child check out sites like Fastweb.com and search through their database. Check to see if there are any scholarships for students in your town, or if your employer or union offer scholarships for the kids of employees or members. Every little bit helps.

More on this in next month’s issue of “DUH!!!” magazine.

Once again, I have another item to add to the list:

11.  You don’t have to go to college.

Rather than wasting 4-6 years of their lives getting drunk, high, and catching STDs, give your kid(s) this option: you can have the money we were going to give you for college if (and only if) you use it to start your own business.

Hey, it worked for Warren Buffett, Michael Dell, and Steve Jobs.  You want to present this option early, especially if your child is going to major in something like psychology or economics.  Because those majors are Worthless.

The video has nothing to do with this post.  I just really like AC/DC.

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Categories: College, Education, Opportunity Cost, Student loans

Tags: , , , ,

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