Re: The inflation fallacy
impactnow
4/25/2012 11:35:24 AM
Predictable chaos exactly and look at the increases in healthcare insurance every year! Our salary increases do not account for those costs making our real income negative, it's a snowball problem based on flawed inflation analytics.
You can't live their lives. You can only love them and hope for the best -- and use your vote wisely to help make sure they inherit a sane world.
Your kids have the advantage of a financially savvy mom! They've kept debt low and majors like nursing provide more opportunities than some fields.
We have two sons in college now and they've made good choices (so far) but have taken different paths. One's out-of-state at an expensive private school, the other stayed closer to home at our state's land grant University. Both are moving forward with what they really want to do.
One of the smartest things two of my daughters did was attend community college for a portion of their college careers. One attended two years, living at home, and then transferred to UAlbany. She graduated with a modest $14,000 debt. The other attended an out of state school, felt undecided about her major, returned home and attended community college while she refocused her plans. She'll be a senior nursing major at a NYC area four year college next fall, graduating with some debt -- but much less than she would have if she had not planned as carefully.
@Noreen
$100,000 is mortgage-level debt, which means it will take a long time to fully pay back. In the mean-time, with interest, the average graduate will be paying back $150,000 or even $200,000. These amounts start to be comparable with the life-time financial advantage of being a college graduate.
The data for 62-year-old college graduates is either based on recent 62-year-olds or long-term projections. The economy is changing and it's not clear how the Class of 2012 will fare when they're 62.
One advantage that is real is the lower unemployment rate for college graduates. In a difficult economy, not having a college degree can be a major obstacle.
PC
One of the effects of the recession is that more students are turning to community colleges.
In 2006, 41.7 percent of traditional-age students enrolled at two-year colleges; in 2009, 44.5 percent did so. Between 2008 and 2009, enrollments of traditional-age, first-time students at two-year colleges increased by 8.3 percent.
A report released last summer by the National Student Clearinghouse Research Center suggests that this trend was driven by two groups of students: those who, in a better economy, might have chosen to attend other (and costlier) types of institutions, and those who otherwise would have joined the work force after graduating from high school.
Re: Saving for College
AskAsa
4/23/2012 9:33:44 AM
That is not as high as I would have estimated. It seems that every high school student is directed to college these days, even ones that may not be good fits for it.
PC,
A 2010 study by economist Gonzalo Castex found that the college enrollment rate increased from 41 percent in 1980 to 68 percent in 2000.
But just don't quit. Say a student starts college but drops out after two years (accumulating $50,000 in debt) and enters the labor force with a much lower skill premium. In this case, the student is saddled with student loan debt but earns only 15 percent more than a high school graduate. In this case, the "investment" really doesn't pay.
Assuming the average cost of attending college (including room and board) is approximately $26,500 per year ($16,000 for public and $37,000 for private), students who completely finance their four years of education with loans will accumulate just over $100,000 in debt. If we assume such students pay off their debt (and interest) and earn a premium of 74 percent after graduation, they will surpass the lifetime earnings of the high school graduate by the time they reach 34 years of age. (See the chart Lifetime of Earnings)
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