College Choices - Prestige vs Avoiding Debt??

[NDallasRuss]

We're entering the part where the daughter (no pics) is starting to fill out college applications. As she's supposed to do, she's going to apply to a mix of colleges - the reaches, the matches, and the safety schools. We've never done this before, so we're not sure what's going to happen, but it's given us a TON to think about.

One of those is the cost/benefit of how good the school is, versus how much debt she may come out with.

Forgetting for a second that all of here are extremely wealthy, what do you think the right mix is for how good of a school she gets a diploma from, vs how much debt she may end up with when she's done? I know that there is significant benefit to having degrees from some schools that put you at a higher starting point, open up doors, etc. I also know that some low-tier schools give a lot of guaranteed money for highly qualified applicants. And I know that despite the starting point, it can become a matter of what you do with your career once you're in it.

For the purpose of the poll, suppose the following:
"Reach" schools are ones like Harvard, Yale, Dartmouth, Princeton, Penn, Stanford, Georgetown
"Match" schools are ones like U of Virginia, William & Mary, Michigan, U of Texas, Cal, USC, UCLA
"Safety" schools are ones like Virginia Tech, Tennessee, Alabama, Texas A&M, Baylor

Also, if it helps, she's looking to major in one of two things - either route will include graduate/medical school, so this is specific to undergrad:
International Relations, minor in Economics
Biology/Pre-Med

I know that there are more than three possible options out there, but I wanted to keep it simple.

So what do you think the best option is? Is it worth it to get a top tier degree, but get the debt it may come with?

 

[Titanhawk2]

I can be impressed by a Wharton MBA, but simply having a piece of paper that says you attended Yale for 4 years I'm not.

 

[Finance85]

The value of Reach schools isn't just the prestige, but the contacts that are made.

 

[mnole03]

If she wants to go to medical school, tell her to go where she can get A’s.

If she wants to do I-banking or something of the sort, then you’re more limited in where they recruit.

 

[Fijimn]

We're entering the part where the daughter (no pics) is starting to fill out college applications. As she's supposed to do, she's going to apply to a mix of colleges - the reaches, the matches, and the safety schools. We've never done this before, so we're not sure what's going to happen, but it's given us a TON to think about.

One of those is the cost/benefit of how good the school is, versus how much debt she may come out with.

Forgetting for a second that all of here are extremely wealthy, what do you think the right mix is for how good of a school she gets a diploma from, vs how much debt she may end up with when she's done? I know that there is significant benefit to having degrees from some schools that put you at a higher starting point, open up doors, etc. I also know that some low-tier schools give a lot of guaranteed money for highly qualified applicants. And I know that despite the starting point, it can become a matter of what you do with your career once you're in it.

For the purpose of the poll, suppose the following:
"Reach" schools are ones like Harvard, Yale, Dartmouth, Princeton, Penn, Stanford, Georgetown
"Match" schools are ones like U of Virginia, William & Mary, Michigan, U of Texas, Cal, USC, UCLA
"Safety" schools are ones like Virginia Tech, Tennessee, Alabama, Texas A&M, Baylor

Also, if it helps, she's looking to major in one of two things - either route will include graduate/medical school, so this is specific to undergrad:
International Relations, minor in Economics
Biology/Pre-Med

I know that there are more than three possible options out there, but I wanted to keep it simple.

So what do you think the best option is? Is it worth it to get a top tier degree, but get the debt it may come with?

She has very good schools on her list. You should be proud. If my kid was dead set on one of the reach schools and got in, I think I’d make that happen.

 

[SoFla-Hawkeye]

Undergrad = degree
Grad = debt

 

[nolesincebirth]

The reach schools and match schools are phenomenal schools but you can’t justify that kind of debt for undergrad when she’s going to incur 6 figure debt for med school too.

I went to FSU for undergrad and finished with less than $15k in debt. Then I foolishly went to a private law school and ran up a total of about $100k (including the FSU debt). That kind of debt DRASTICALLY changed my career options. I was forced to go to work in a law firm sweat shop and chase the salary instead of taking what could have been a more rewarding job that paid less. I had no choice but to go for the money. And I hated it. I’d advise against anyone starting their career with six figure debt.

 

[hawkeyetraveler]

We're entering the part where the daughter (no pics) is starting to fill out college applications. As she's supposed to do, she's going to apply to a mix of colleges - the reaches, the matches, and the safety schools. We've never done this before, so we're not sure what's going to happen, but it's given us a TON to think about.

One of those is the cost/benefit of how good the school is, versus how much debt she may come out with.

Forgetting for a second that all of here are extremely wealthy, what do you think the right mix is for how good of a school she gets a diploma from, vs how much debt she may end up with when she's done? I know that there is significant benefit to having degrees from some schools that put you at a higher starting point, open up doors, etc. I also know that some low-tier schools give a lot of guaranteed money for highly qualified applicants. And I know that despite the starting point, it can become a matter of what you do with your career once you're in it.

For the purpose of the poll, suppose the following:
"Reach" schools are ones like Harvard, Yale, Dartmouth, Princeton, Penn, Stanford, Georgetown
"Match" schools are ones like U of Virginia, William & Mary, Michigan, U of Texas, Cal, USC, UCLA
"Safety" schools are ones like Virginia Tech, Tennessee, Alabama, Texas A&M, Baylor

Also, if it helps, she's looking to major in one of two things - either route will include graduate/medical school, so this is specific to undergrad:
International Relations, minor in Economics
Biology/Pre-Med

I know that there are more than three possible options out there, but I wanted to keep it simple.

So what do you think the best option is? Is it worth it to get a top tier degree, but get the debt it may come with?

We just went through this exact process last year. My oldest got into one of the "top tier" status schools. She got into most of the match schools including Michigan, Illinois and UCLA. She is planning to go to graduate school as well.

She chose the in state school - Illinois, even though there were multiple schools that on paper are more "prestigious". This was deliberate as undergrad (at least among this tier) is less important than grad school. And, because Illinois has an outstanding engineering school, in the end she will be getting a top tier education for a lower price than if she chose one of the more prestigious paths.

I have a similar story - I went with Iowa as my undergrad (I had no parental support and was able to work my way through school with no debt). I went on to get an MBA from Northwestern which served me well and have had many ivy league grads work for me over time. I honestly don't think getting a prestious undergrad degree is that important if you plan for graduate school down the road - I definitely think grad school choice matters.

 

[The Tradition]

From a hiring manager's perspective, I'm generally not impressed with resumes from people who went to "elite" schools.

My first thought is, "This candidate is going to want too much money."

The only exception is if we're looking to fill an "elite" job where a high salary expectation is not an issue.

 

[Hoosierhawkeye]

I would say that if she's planning on going to grad school or medical school before entering the work force than the name on the grad school or med school degree will probably matter a lot more than the name of the undergraduate school.

There are a lot of other factors involved here but from that perspective I would say the safety schools make the most sense to me.

IDK I probably went to a bit of a reach school academics wise since I'm pretty sure my test scores were below average for entering freshman at the school I attended but it didn't turn out the greatest for me on the job market. There we're other factors involved such as me not being close to a major city and the fact that I had very few contacts in the professional world that I wanted to enter. I probably also could have picked a better major.

That said I think if you are going to med school or something like that, people are going to look at the name of the med school that was attended and probably won't concern themselves too much with the name of the undergraduate school. And I think med schools probably don't care all that much about the name of the undergraduate school so much as if she got good grades while she was there.

 

[ferentzin04]

Come on Russ, you know what she needs to do...

 

[Fijimn]

I will say that regionalism is a consideration. If she is going to live in Texas, then a Texas school will probably tip the scales on a cost v benefit analysis.

 

[ATLNole1]

If she is fairly sure that graduate school is in the future then I would go to one of the match or safety schools for undergrad and save the debt capacity for a good reputation graduate school.

After I graduated from law school, no one really cared about where you did undergrad. The headline is where the graduate degree came from to initially get a foot in the door. After you establish a work history, no one really cares about what graduate school you went to either.

 

[funksouljon]

Come on Russ, you know what she needs to do...

So..... safety school?

 

[West Duval Nole]

0 Debt.

Research by Alan Krueger and Stacy Berg Dale found that school selectivity, measured by the average SAT score of the students at a school, doesn't pay off in a higher income over time. "Students who attended more selective colleges do not earn more than other students who were accepted and rejected by comparable schools but attended less selective colleges,"

Also per https://www.lendkey.com/blog/paying...ted academic research,where you go to college.

Is it the college or the student that makes the difference?

One recent report revealed that students who attend more selective or prestigious universities earn more money later in their careers. On the surface that might indicate that going to an Ivy League school, for example, is a better long-term investment. But there are other factors that influence earning power that should be taken into consideration. Students who manage to work hard and make the excellent grades needed to go to those top-tier colleges are likely more ambitious and disciplined. Those traits alone could help them achieve greater career success and earn more money, regardless of what college they attend.

Are prestigious colleges an advantage for getting hired?

Sometimes companies do prefer to hire people with prestigious college credentials. So graduation from an impressive university can definitely impress those who make hiring decisions. But that’s not their primary concern, according to a 2013 Gallup Poll that surveyed corporate leaders and asked them about their hiring process. Less than 10% of respondents said that what college someone attended was “very important.” When questioned about four factors that influenced their hiring decisions, the majority of employers ranked which college a potential candidate attended as the least import of all.

 

[BrunoMars420]

Having zero debt is such a huge advantage coming out of college.

 

[Gonolz]

If she is planning on grad school, then undergrad school prestige is not as important. I say take the free ride at the best school that offers it.

I partied my ass off at FSU undergrad and don't regret for a second not going somewhere more prestigious. I got got the grades and test scores to assure a good grad school. I then went to an elite public school on your daughter's list. I could have gone Ivy, but going to the in-state school that I did, I was able to get some scholarship money and the cheaper tuition saved me a couple hundred grand. I still ended up with the same opportunities. I paid off my debt in a few years and that was a relief. I had colleagues who went Ivy and were drowning in debt starting out.

I suggest that your daughter go undergrad at the school where I went to grad school. If she gets some scholarship money, then even better. Don't let her go to Bama. That is almost as bad as UF. Well, not really, but still, Bama sucks.

 

[SoFla-Hawkeye]

One thing to consider when looking at “reach” schools is their financial aid policy. Many have a “all demonstrated financial aid need” will be met. My oldest son graduated from a reach school with only a $10,000 student loan debt. Don’t let the fear of debt dictate the application process. I was taught at an early age not to say “no thanks” until something was offered. Apply. File your FAFSA. Wait for the offer. Make your decision.

 

[NDallasRuss]

Thanks everyone - I really appreciate your input so far!

 

[mthawkeyes]

Biology/Med Track: Mid-tier, get good grades, prepare for MCAT. There's plenty of debt coming. If research career (in conjunction with or instead of Med School) is possibility, make connections with faculty and engage in undergraduate research opportunities.

International Relations/Econ: Might be a worthwhile investment to form relationships/connections at top-tier college for career prospects.

 

[Formerly Rockymtnole]

I think a lot depends on the student - my son has great grades and works hard but is not what we used to call a "gunner" - those kids who sit up front, chat up teachers and advisors, take optional study classes, etc. He has researched what he needs to get into our state universities and I think in his mind he has already checked the box. That's fine with me. They have to want to do it themselves and I'm not going to push them anywhere they don't want to go. I also agree that if grad/professional school is in plans then that school matters much more than undergrad.

Philosophically, we are not going to pay out of state tuition for any public university. That makes no sense to my wife or me. Only possible exception would be FSU for nostalgia reasons (and because FSU is dirt cheap by comparison)

 

[NDallasRuss]

I can be impressed by a Wharton MBA, but simply having a piece of paper that says you attended Yale for 4 years I'm not.

Undergrad = degree
Grad = debt

I would say that if she's planning on going to grad school or medical school before entering the work force than the name on the grad school or med school degree will probably matter a lot more than the name of the undergraduate school.

If she is fairly sure that graduate school is in the future then I would go to one of the match or safety schools for undergrad and save the debt capacity for a good reputation graduate school.

If she is planning on grad school, then undergrad school prestige is not as important. I say take the free ride at the best school that offers it.

I think this makes a lot of sense, but I worry if the undergrad school is too far down the list, it'll hurt her chances getting into a top grad/medical school later on. You think that's not as likely, that no matter the undergrad schools, her grades and mcat/gre/gmat scores will be all that matters?

I also worry about the internship opportunities that may be available through some of the better schools, but might not be at the lower tier schools. I think that's especially relevant if she ends up wanting to do International Relations and could go somewhere like Georgetown where there are a lot of opportunities to intern in DC and all around the world.

 

[Sooner-Be-Dead]

For the elite public schools like UVA, how long does it take to establish residency?

 

[LunchBox50]

If she is fairly sure that graduate school is in the future then I would go to one of the match or safety schools for undergrad and save the debt capacity for a good reputation graduate school.

After I graduated from law school, no one really cared about where you did undergrad. The headline is where the graduate degree came from to initially get a foot in the door. After you establish a work history, no one really cares about what graduate school you went to either.

This is the correct answer.

 

[NDallasRuss]

One thing to consider when looking at “reach” schools is their financial aid policy. Many have a “all demonstrated financial aid need” will be met. My oldest son graduated from a reach school with only a $10,000 student loan debt. Don’t let the fear of debt dictate the application process. I was taught at an early age not to say “no thanks” until something was offered. Apply. File your FAFSA. Wait for the offer. Make your decision.

We attended a (pre-COVID) admissions seminar where the guy for Yale talked about that. They put together a package based on the parents income that figures out their expected contribution and takes care of the rest through grants, scholarships, part time job, and maybe a small amount of loans. That would be a pretty good deal.

 

[NDallasRuss]

For the elite public schools like UVA, how long does it take to establish residency?

UVA is in-state for us. For University of Texas, I believe it's a year. I've thought about moving back to texas if she went there, so she could be in-state for the remaining years.

 

[NDallasRuss]

If she is planning on grad school, then undergrad school prestige is not as important. I say take the free ride at the best school that offers it.

I partied my ass off at FSU undergrad and don't regret for a second not going somewhere more prestigious. I got got the grades and test scores to assure a good grad school. I then went to an elite public school on your daughter's list. I could have gone Ivy, but going to the in-state school that I did, I was able to get some scholarship money and the cheaper tuition saved me a couple hundred grand. I still ended up with the same opportunities. I paid off my debt in a few years and that was a relief. I had colleagues who went Ivy and were drowning in debt starting out.

I suggest that your daughter go undergrad at the school where I went to grad school. If she gets some scholarship money, then even better. Don't let her go to Bama. That is almost as bad as UF. Well, not really, but still, Bama sucks.

We're really trying to impress upon her the value of going there for undergrad at in-state tuition prices, which we could cover, vs going to a slightly better school that'll cost 4x as much.

 

[St. Louis Hawk]

I went to Iowa for engineering undergrad and a private law school. Little debt graduating Iowa. Major debt graduating law school. Almost 85k and that was in the mid-90’s.

Pick the best school that you can get through undergrad with little debt then, if she’s still on track, the best reach school for grad school.

 

[UKGrad93]

$100k will buy a modest house in rural America. $300k will buy a decent house in the suburbs of middle America. Either amount would be nice to have in a 401k starting out. If she has debt, she is missing the opportunity for these other investments. I think in economics it is referred to as opportunity cost (econ 101 was ~30 yrs ago, so I may be wrong).

 

[BelemNole]

We've been getting the same mail that you have - don't the reach school all say that if you get in that the average student doesn't pay more than a $15-25k per year depending on the ability of the family to pay? I'd say try for the reach schools and then talk to the finance office about how much it will really cost.

 

[Formerly Rockymtnole]

We're really trying to impress upon her the value of going there for undergrad at in-state tuition prices, which we could cover, vs going to a slightly better school that'll cost 4x as much.

It's a tough balance, isn't it? You want them to aim high, but not at any cost.

 

[artradley]

We're entering the part where the daughter (no pics) is starting to fill out college applications. As she's supposed to do, she's going to apply to a mix of colleges - the reaches, the matches, and the safety schools. We've never done this before, so we're not sure what's going to happen, but it's given us a TON to think about.

One of those is the cost/benefit of how good the school is, versus how much debt she may come out with.

Forgetting for a second that all of here are extremely wealthy, what do you think the right mix is for how good of a school she gets a diploma from, vs how much debt she may end up with when she's done? I know that there is significant benefit to having degrees from some schools that put you at a higher starting point, open up doors, etc. I also know that some low-tier schools give a lot of guaranteed money for highly qualified applicants. And I know that despite the starting point, it can become a matter of what you do with your career once you're in it.

For the purpose of the poll, suppose the following:
"Reach" schools are ones like Harvard, Yale, Dartmouth, Princeton, Penn, Stanford, Georgetown
"Match" schools are ones like U of Virginia, William & Mary, Michigan, U of Texas, Cal, USC, UCLA
"Safety" schools are ones like Virginia Tech, Tennessee, Alabama, Texas A&M, Baylor

Also, if it helps, she's looking to major in one of two things - either route will include graduate/medical school, so this is specific to undergrad:
International Relations, minor in Economics
Biology/Pre-Med

I know that there are more than three possible options out there, but I wanted to keep it simple.

So what do you think the best option is? Is it worth it to get a top tier degree, but get the debt it may come with?

Ivy League schools are worth it because the prestige translates into big money. Plus, they have such massive endowments nobody needs to accumulate $300k worth of debt. If you can’t afford to write that check they’ll give you a sizable scholarship.

After that it makes little difference. Get through as cheaply as you can for your Bachelors; then consider a more prestigious school for your post grad.

 

[OrlandNole]

UVA in-state tuition > free "safety" school > Ivy + $300K debt

 

[NDallasRuss]

If my kid was dead set on one of the reach schools and got in, I think I’d make that happen.

Part of me wants this to be the right answer. If she REALLY wants to go to Stanford, then we should find a way to make it work, no matter what. Part of me knows we need to keep her focused on the value of the whole thing, and not just get locked in on a "favorite" school or two.

I will say that regionalism is a consideration. If she is going to live in Texas, then a Texas school will probably tip the scales on a cost v benefit analysis.

I don't think that she's set on where she wants to live after. I think part of the up-side for IR for her is the ability to live/work all over the world.

I do know that one of the (several) reasons she likes University of Texas is the opportunity to get to be back closer to family.

 

[EvilMonkeyInTheCloset]

Iowa > all the other schools on this newfangled "tier list".....because who needs a tier list when there's only one school you should be sending your kid to anyway.................

 

[UKGrad93]

Both my wife (no pic) and I graduated from state university with little debt. We both went to work and had a combination of fellowships/employer money that paid for grad school at a state university. There used to be loan forgiveness programs for people that went to medical school that would then go practice in an under-served area. Not sure if that is still around or not.

 

[littlez]

Isn’t UVA basically an Ivy these days or really close? If it’s instate and she could get in there that’s a no brainer to me. This is a great thread. Obviously the Ivys offer connections that most other schools don’t offer. My son getting a political science degree out in Cali. Costing me about 10K a year more than a state school but I have the money to pay. Probably going to need to either go to law school or go to grad school after that. That’s where the funding becomes a problem. At least for me. Probably split the cost as he will come out of undergrad with no debt, which is a huge head start these days.

 

[West Duval Nole]

I do know that one of the (several) reasons she likes University of Texas is the opportunity to get to be back closer to family.

Sounds like you need to join the Californians and move to Texas.

 

[Formerly Rockymtnole]

We've been getting the same mail that you have - don't the reach school all say that if you get in that the average student doesn't pay more than a $15-25k per year depending on the ability of the family to pay? I'd say try for the reach schools and then talk to the finance office about how much it will really cost.

That's my understanding. List price might be $55k a year but depending on income a student might pay a fraction of that (or even zero). The thresholds cut off pretty low though, so we don't expect any discounts.

 

[Sooner-Be-Dead]

UVA is in-state for us. For University of Texas, I believe it's a year. I've thought about moving back to texas if she went there, so she could be in-state for the remaining years.

Seems like UVA should be her #1 school unless she has something against it. Awesome campus/town.