Do the Math!
By Jeannette Webb
Today’s teenagers live in a privileged world. They have plenty of food. They live in a nice home. Dad functions as an ATM machine and picks up the tab for shopping mall trips, cars, travel, and entertainment.
Our student’s hands do not labor to butcher or prepare the meat they eat, nor do their heads labor to figure out how to make ends meet. So it is a happy world, full of dreams and possibilities. Because more unpleasant aspects of reality rarely enter into their personal domain, they can envision all kinds of wonderful futures for themselves without ever counting the cost.
Unfortunately, as a college counselor, I often have to serve as a reality check. If students wait and don’t come to me until the senior year, it is often too late to make changes and students wake up in a decidedly unromantic picture. So I encourage you to help your students do the math tied to their dreams. The first questions is “what will their chosen educational path cost?”
Too many parents also live in a dream world in regard to the cost of a college education. There are scholarships out there, but the current economy and huge numbers of college students conspire to make full rides a rare thing indeed. So, get a pencil and your calculator and figure a worst-case scenario for educational expenses.
Undergraduate college degree costs – IF your child gets out in four years, a state university could cost around $75,000. A top-tier private school will cost around $200,000.
Professional degree costs – Let’s take medicine as an example. National averages say that a public university medical degree will cost $197,192 with the average debt at graduation falling at $150,000. A private medical school degree is estimated to cost approximately $267,936, with the average debt at graduation falling in the range of $180,000.
But we are not finished. Also to be considered are the opportunity costs of not working while the student pursues professional training.
Opportunity Costs – The average income for a recent college graduate is up from last year at around $50,462. However, only 57% of recent grads are working full time. Those who are hired in this down economy are from predictable fields: engineering, computer science, accounting, and business. So, if your student could get hired, he would be giving up $201,848 in opportunity costs to go to a professional school.
Total worst-case scenario cost (undergraduate degree + professional degree + opportunity costs) of the most conservative picture would be $399,115.
That’s quite a tab.
Here’s the conversation I have fairly frequently with young women. They want to go to college, go to professional school, work a couple of years and then quit to stay home with their families. The reality check – I know far too many young women stuck with horrendous debt and therefore have no choices in life but to continue working. Therefore, it is wise for young women especially to decide whether or not they want to pursue professional school given the accompanying debt. Considering that young men will usually work their entire adult life, professional school and its debt load might make more sense.
Unfortunately, many college degrees don’t transmute to jobs upon graduation or they qualify grads for low paying jobs that don’t require a degree at all. It is the worst of both worlds to have a poor college degree which has encumbered you with debt and be stuck in a low paying job with little ability to get your neck out of the noose. It is a happier scenario for some professional school degrees (like medicine), but decidedly not for some other professional degrees.
Here’s yet another way you need to help your kids do the math. Students rarely have a clue what it takes for their family to support the lifestyle they grew up with. They never think about whether or not their skill set will provide the same lifestyle. They breeze through high school taking classes that are intuitive and shirk the harder stuff. Reality is hard to swallow when they hit their senior year in high school and realize that not only do they not have the types of classes to qualify them to enter competitive colleges, but they also do not have the skills to step into college majors that will lead to good jobs.
Let your students be an integral part of your budgeting process. Talk long and deeply about the kind of lifestyle they think they want and put a figure to it. Assist them in doing the research to see what different professions make.
Students who have actually done the math (i.e. who have counted the costs of their dreams, who have figured out what it will cost for them to live the lifestyle they desire) are more willing to do the math (tough math and science classes) in high school and college to qualify them for good schools, better careers, and a brighter future.
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