Posts Tagged ‘paying for college’

Book Review of Suze Orman’s Action Plan


Suze Orman’s Action Plan was on my reading list for a while and I finally got to it.  While reading, I was happy to see that Orman’s advice was right on par with White Picket College.  She even has an entire chapter called Paying for College.  Reading the chapter pretty much mirrored what we discuss here at WPC, but I was fascinated to find out her opinions on currently taking out a 529 plan and a PLUS Loan.  These two topics will be addressed in future posts.

I was most intrigued by the Retirement section–not only for myself, but for the readers here at WPC.  If you’re like me, 20 or more years away from retirement, you’ll find Orman’s stock advice to be very surprising.  Even my fiance, who is very organized in regard to his retirement fund and has a financial planner, was surprised by her advice.

In the revised from 2009 edition, Orman added a chapter entitled Kids and Money.  Quite frankly, I love this section because it shows parents how to financially educate their kids.  It may sound easy, but Orman addresses tough questions.  For example, what do you do when your brother and sister-in-law give your children extravagant gifts … but you can’t do the same thing in return?  It’s a good question, right?  As I read it to myself, I was thinking, I’m not sure what I’d do if I was a parent in this situation.  Orman answers a lot of tricky questions like this, including ones about kids in college or right out of college.

I highly recommend Suze Orman’s Action Plan.  It’s only $9.99 and very much worth the small price.  Remember to buy the “revised and updated (edition) from Suze Orman’s 2009 Action Plan.”  Happy reading to all of our followers!

~ the WPC team

© White Picket College, 2010 – College Funding for the Upper Middle Class

How About Students Help Pay for College?


We always discuss how it’s the parents’ job to pay for college.  But what about students contributing to their education?  How will this help upper middle class (UMC) families who are struggling to put one child through college?

An ambitious student and hard worker, Zac Bissonnette, author of Debt Free U: How I Paid for an Outstanding College Education Without Loans, Scholarships, or Mooching off My Parents, details how Zac, a college senior, pays for school.  He works full-time and chose a relatively inexpensive, in-state university.  His tactics worked and he will graduate completely debt free, quite a feat.  I watched Zac on CNN last week as he discussed statistics from Academically Adrift, which reports college students spend half their time socializing.  Zac said on CNN:

The average college student is drunk 10.2 hours per week. So if you think that your kids should not work during college …

He makes a good point.  Why can’t students work through college?  And why can’t they work before college even starts?

Unfortunately, the money the student makes before college will be accounted for in taxes and on the FAFSA.  And this lowers your chance of financial aid.  But if you find yourself without acceptable educational financial aid, a good solution is to have the student go to work.

Working before college and through college may seem like a punishment to some parents and students, but quite frankly, it’s what my parents did and the generations before them did.  Earning full-time money, instead of drinking or partying, will help the student receive must-needed work skills and life experience and teach them how to financially support themselves.

If a family really cannot afford to pay for college, another good solution is to have the student defer admission for a year.  S/he can use that year to work a full-time job or many part-time jobs and save up for college.

We realize these solutions may not be ideal for the UMC, but they’re practical.  Now more than ever UMC families must approach their financial decisions with pragmatism.  And students paying for their college education sounds like a good decision to us.

~ the WPC team

$3.4 Billion in Free Scholarships.

© White Picket College, 2010 – College Funding for the Upper Middle Class

Colleges with Highest Paycheck 2011


On Christmas Eve, my mother asked me if I had seen the list of colleges with the highest paycheck for 2011.  I hadn’t, but was happy she let me know.  I was delighted to find out my alma mater was actually on the list as well.  What other college graduates make the highest salaries?

Harvey Mudd, a Claremont college (California), is the winner.  Graduates rake in a starting median salary of $68,900.  A mid-level median salary is $126,000.  The next colleges in line are Princeton and Dartmouth.

To see the full list, check out:

Colleges That Bring the Highest Paycheck 2011

Is your college or your child’s college on the list?  Normally, I don’t put too much weight on lists such this one, but with the horrible economy, dwindling financial aid and outrageously expensive loan repayments, it’s time to start looking at salaries vs. tuition.  Again, I’ve been repeating over and over (I know I must sound like a broken record), you have to take loan repayment into account these days.

On a personal note, I’ve recently lost a job (one of my many jobs).  I’m about to take a huge financial hit.  It’s going to hurt badly.  To make it worse, the company just told me yesterday they’re closing their doors on December 31st.  What makes this situation especially stressful is the fact I have to pay back $380 a month in loans.

That’s what students (and parents) need to take into account these days: my current situation.  I have a B.A. and a Master’s from two super fancy colleges and it’s going to be hard to find a job.  Companies would rather pay a fledgling post-grad $28K a year (in NYC) than pay more for experience.  It’s a tough world out there today and students must account for these rough patches.

Therefore, it’s good to see where your college or potential college stands on the pay scale.  And it’s good to ask yourself why and how the students bring in the big bucks?  Is it motivation?  Is it the school’s career development center and its connections?  Is there a great mentoring or internship program that leads to jobs?

You have to ask yourself these questions.  A job is not guaranteed upon graduation.  Choosing the college with graduates who get and keep jobs and make high salaries are all great reasons to choose a school nowadays.

Make sure you take this above list into account when applying to colleges.  Look toward the future, life after college.  It’s now the norm.

~ the WPC team

Student Financial Guide

© White Picket College, 2010 – College Funding for the Upper Middle Class

Two or More Kids in College?


Often when I write these posts, I address them to upper middle class (UMC) parents who have one child in college.  I often forget that parents, of course, are sending two or more kids to college.  That’s an incredible financial burden on a family, even if parents are happy to do so.

To make the burden even heavier, I found out that parents are not considered part of the financial aid formula if s/he is also a student.  In other words, if mom or dad is going for her/his PhD or Master’s, well, that doesn’t count toward a person in college.  It’s pretty unfair, if you ask me.  Sometimes I scratch my head and wonder, who makes these rules?

Now that we have that out of the way, let’s go back to talking about the kids.  The federal government’s formula is simple.  They divide the parents’ contribution by the number of dependent children in college.  Then they get a per child contribution.

Paying for College Without Going Broke cites the College Board formula: “If there are two [dependent children] in college, the parents’ contribution for each student will be 60 percent of the total parents’ contribution.” For three kids, 45 percent; four or more kids, 35 percent.

Again, I’m left wondering who makes these rules.

Either way, it’s good to know because parents who are sending two or more kids to college seem to fare better at least in the federal financial aid formula.  It’s a simple division of children, but the College Board seems to be less forgiving.

It’s best to do your research and know all the rules when sending more than one kid to college.  You can only benefit from understanding how the system works, even if it can be unfair.

~ the WPC team

Student Financial Guide

© White Picket College, 2010 – College Funding for the Upper Middle Class

Is College a Scam?


Is college really a scam?  Is the wool being pulled over our overly-educated eyes?  I’ve been thinking about this lately.

I know I personally qualify as a member of the overly-educated American middle class.  I have a Bachelor’s and a Master’s degree.  And I ask myself daily, from a financial perspective, what is it all good for?

This especially happens when I see someone on Facebook, someone who I went to high school with, who is of average intelligence and has little ambition.  Said person has only a high school degree or an associate’s degree.  S/he lives in a beautiful house with either a rich spouse, or s/he works a very average job … and still makes more money than I do.  This leaves me scratching my head and thinking, what was I thinking?

I feel very closely attuned to the college graduates of today, who question their choice in getting a degree.  Thousands upon thousands of dollars in loan debt, and without a job, it’s hard to find the silver lining of the year 2000 Clinton economy.

Not only do I question this, but so does finance expert James Altucher of DailyFinance AOL.  In his article entitled Seven Reasons Not to Send Your Kids to College he lists 7 reasons of why college is a scam.  The one reason that really caught my eye was:

The cost of the average college tuition has gone up nine-fold since 1976 versus seven-fold for health care and three-fold for inflation.

I was pretty shocked by this fact, especially in comparison to health care.

Altucher goes on to say instead of paying for college, parents should give kids $20K to start one of five businesses.  Or they can travel the world, work, volunteer and do nothing but read.

OK.  I agree with taking a gap year.  I really wanted to do so, but my father was near retirement and turned down the idea, which is understandable.  I agree with working for a while, especially if the kid is not ready or mature enough for college.  I agree with volunteering for Habitat for Humanity or another organization.

I do not agree with $20K for a new business.  Even the best businessmen and women with MBAs from the best schools have businesses that fail.  Donald Trump declared bankruptcy.  So just giving $20K to an 18-year old who knows nothing about overhead, capital, profit margin, start-up costs … and doesn’t even know what these terms mean sounds like a terrible idea.  One of the worst I’ve ever heard.

I also do not agree with “do nothing but read.”  That’s fine if you want to be the next Jack Kerouac, but if your interests lie in science or technology, where can you just go into a lab and conduct experiments?  The equipment alone, glassware and simple measuring devices in a biology or chemistry lab can easily cost over $1000.  Plus, the chemicals you can’t purchase unless you’re connected with a school.  I won’t even go into graphic design …

I’ve saved the best part for last.  I looked up Mr. Altucher’s background.  Apparently, he has a Bachelor’s from Cornell University and a Master’s from Carnegie Mellon University.

Do as I say, not as I do.

I’m certainly not saying Mr. Altucher is wrong.  After all, he is a financial expert with degrees from prestigious schools and he makes excellent points.  But some of his suggestions come off a little like Kanye West, a rapper who urges children not to go to college.

What do you think?  Is college a scam?  Please let us know.

Please read what financial expert Peter Schiff has to say on this subject.

~ the WPC team

© White Picket College, 2010 – College Funding for the Upper Middle Class