Published August 26, 20199 min read
Welcome to Money Slackers, a regular discussion among Policygenius staffers about money. We held the following conversation in a Slack chatroom. It's been lightly edited.
Myles Ma : Today because kids are going back to school I wanted to talk about how we all paid for college. So how did you pay for college? I CAN START. My mom and my aunt helped a lot so I have no debt. I went to a state school so they were able to do that. They were not able to help my siblings who went to private school out of state and have tons and tons of debt. Anyone else get help from folks?
Blayne Smith : Wow, sounds like you really screwed your siblings over Myles.
Myles: First born, babyyy.
Jeanine Skowronski : My parents paid for my college education. But I did get a partial scholarship and I also went to a state school to mitigate the costs.
Hanna Horvath : I got help from my folks. My mom is also a professor so I got a lot of money off my tuition.
Myles: Did you attend the school where your mom teaches?
Hanna: No. My mom was a professor at Georgetown at the time (I went to Syracuse) and Georgetown had a system in place that they would pay half the tuition of all professor's kids, no matter where they went, and then full ride if they went to Georgetown. So I got like $20,000 to $25,000 off my tuition each year.
Holden Lee : Help, in that my parents were poor and my college was generous with its financial aid as it was needs-based. So relatively low amount of loans, which I was able to pay off before turning 30.
Blayne: Private, out of state, needs-based financial aid, fair amount of help from my parents, work study, worked offsite, loans that I finished paying at 29 to 30 years old.
Erica Horowitz : In Florida they have a prepaid program and scholarship based on grades. My grandpa paid for the base of classes (prepaid program) and the scholarship paid for the other portion. For grad school, it was strictly scholarship and my parents' help.
Trying to get grandpa or grandma to help pay for college? Check out our state-by-state guide to prepaid tuition and 529 plans.
Kieran Duffy : My parents made just enough for me not to qualify for the needs-based program, but not enough to help me pay for schooling. Other than that, I took out loans and will be paying them off for years to come. Scholarships, both education and athletic, helped out a lot though.
Erica: If you used a scholarship, how did you find it to apply?
Kieran: Google and the school.
Myles: I think I got one through my local Rotary or something? I only got the lowest hanging fruit. In retrospect I could have done more.
Blayne: Wait, is this whole article just to promote the Pg scholarship?
Myles: Yes: Check out the Policygenius scholarship.
Jeanine: I'm with Myles. I got some money from the school I attended (The College of New Jersey) and I got a small Rotary scholarship, but I could have definitely done more to get assistance. Sorry, Mom and Dad.
Holden: Financial aid was the biggest area of focus during admissions after the essays.
Erica: My high school guidance counselor had a ton of resources for scholarships. I remember getting a whole list! Grad school was trickier though, I only got a scholarship from Columbia directly.
Holden: Yeah, the whole point of guidance counselors for those that were definitely college-bound was financial aid.
Myles: Erica, thanks for bringing up grad school. I have heard the debt for grad school can be way worse. Can the nerds who went to grad school in this group confirm?
Holden: Yup. MBAs (Master of Business Administration) are expensive, but worth the return on investment, generally speaking. I'd bet law schools also. The variety of programs allow different people with different financial profiles to take on such degrees. Exec programs, part-time, full-time, etc. Also, some employers will pay for tuition if you agree to come back and work for a few years, e.g. top consulting firms. There are also post-degree loan forgiveness programs for certain areas, e.g. if you get a law degree and become a professor.
Erica: I had my family support and scholarships so I ended up with no debt for grad school. I also think it helped that it was only a one-year program. Besides just the cost of the actual degree, some other factors to consider are the cost of living associated with being in school! (rent, books, food etc.) A lot of my friends didn't think about that until it was too late and had to pick up two to three extra jobs!
Kieran: I’m actually in the middle of considering going to grad school. The main blocker is taking on those loans considering I’d be piling them on.
Myles: What do you mean "piling them on"?
Kieran: Meaning I’ll be adding grad school loans to my undergrad loans.
Myles: How do you think your life would be different if college were free?
Jeanine: All college? Or just undergrad?
Myles: All college! It sounds like Kieran would be in grad school by now, for example.
Jeanine: Well, then, I would have went to grad school. Master of Fine Arts: Creative Writing
Erica: I think if college were free I would absolutely have continued with more schooling and with varied types of degrees.
Holden: Frankly, if college were free, it would not really impact my decision or process. Financial aid was secondary to getting in first.
Blayne: Same. I probably would have went to the same or a similar school. I would have started out my career with zero debt but my debt wasn't that crushing to begin with. But I'd have more money in the bank.
Kieran: I chose my school based on athletics so it wouldn’t have changed for me.
Myles: Right for me, yes, grad school is cost-prohibitive but also school is boring and I never want to go back.
Holden: !? How dare you. I would love to go back to school.
Jeanine: You thought college was boring? College was awesome.
Myles: Sooo boring.
Holden: Youth is wasted on the young. College was awesome. Business school was awesomer.
Erica: I love school. I would go back in a heartbeat.
Hanna: Myles with the hot take.
Myles: I assumed I was in the vast majority.
Erica: I think something along the lines of being able to pursue something you are passionate about without cost being an issue would be interesting for people later in life as their career paths matured.
Blayne: I'm pretty sure most people would gladly go back to college. High school, maybe not.
Myles: What about in terms of paying? I know some of us got a lot of help, but for those that did not, would you change the way you funded your education?
Kieran: Yup, 100%.
Myles: How so?
Kieran: I would have either chosen a state school (that in-state tuition perk is a huge plus) or done two years at a community college first.
Myles: Yeah, if I were going to school now I would definitely do the two years at community college first route. Debt is scary. For those of us still paying, how's it going? Dealing with it OK?
Holden: Debt is scary to those that are unfamiliar with it. Like fat, there's good debt and bad debt.
Kieran: Could be worse, could be better but living in New Jersey definitely helps.
Jeanine: Living in New Jersey as opposed to New York City?
Myles: When do you think you'll be done, Kieran?
Kieran: Right now, I'm on track to be done by my mid-30s or so. Which is why I'm hesitant to take on business school debt also.
Holden: I still have business school debt. Very manageable with the low interest rates these days. And with the higher income enabled by said business degree.
Myles: Federal loans? Private? Did you consolidate?
Kieran: Federal loans that gave me awful interest rates. I refinanced them down though, which made it much more manageable.
Blayne: My problem with the "good" vs "bad" debt categorization is that it has led to people to oversimplify all education debt as "good."
Holden: Not sure if I follow the logic. The problem with X is that people are misusing X? So isn't the problem those that misuse X not X itself? I did say that you need to do the math. Of course, if you can't do the math, then :shrug:
Blayne: People latch onto the most salient characteristic of "good" debt, which is that it's an investment in education. Otherwise why have the heuristic to begin with if you're going to need to understand all the nuances to categorize properly?
Holden: Well, invest in an education at Trump University and yeah, no amount of that debt would be considered good.
Myles: I think that's the point Holden, that not all education debt is good because not all educational institutions give you the same return.
Holden: Yes, agreed.
Erica: I'm not sure how related this is, but I had a good amount of friends who took out a ton more debt than strictly just to pay for school. They used the extra money to pay for "fun college things" like sororities or spring break vacations and now they are suffering with massive debt).
Myles: Before we wrap: Dollar Daddies, is this something you worry about? How do you plan to pay for school for your little baby scholars?
Holden: For my kids, 529 savings account. And teaching them financial literacy first chance I get.
Blayne: 529 plan. And praying for bad test scores.
Myles: OK this was a lively discussion. Thanks everyone for all the different perspectives. Remind me to link to something explaining what 529 plans are HERE.
Image: Phillip Blackowl
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