What is a "donut hole family"?
![[Post New]](/jforum/templates/default/images/icon_minipost_new.gif){kind=icon}
Anonymous
a few hundred a month? Three hundred a month with a decent return (5% seems fair, assuming that you have some down years and get conservative during high school) means 25k a year for college. You have to save more than a few hundred a month to even afford in state now. |
Anonymous
Most 4 year state universities are ~$30K per year (maybe $35K). With what min wage is in MD/VA, a kid can earn $10K per year (between PT during school and working most of their breaks/summer). Take $5.5K federal loans. That leaves $15-20K for family to fund. If you don't have that saved, then you do CC for 2 years and/or you do duel enrollment in HS and get your AA for virtually free. Then you transfer to state U. Or you search out private schools at 2nd/3rd tier to what your kid's stats are and get merit of 75-100% of tuition---it's out there, you just have to search and be willing to attend somewhere with a 40-50% acceptance rate (or higher) and your kid at the 85-90% for the school. Plenty of options. But if you have saved even $70-80K for each kid, you can "afford" instate schools or a private with merit. Sure, it may not be a T50 school, but many seem to forget the ultimate goal is to get an EDUCATION. And that is done at all universities. Where you go is not important, it's what you do while there. Let your kid shine at a school where they are at/above 90% and can get an affordable education. It's a great gift to only have $20-25K in student loans when you graduate. Those can be paid back easily for almost any major in 5-7 years (and quicker in many STEM majors). |
Anonymous
|
A family that makes just enough to not qualify for any financial aid and he has to be full pay.
It was my family. My parents only let us apply in-state. Pricey privates, ivies, etc., were off the list. We would have had to take out massive loans. My husband grew up poor with a single mom. He had full ride and Pell grants to just about every Ivy and JHU, MIT. He really couldn't understand at first--yeah---hey some of us also had perfect test scores and were top of our class BUT our options for college were limited. You get snobs that judge on pricey top 10 schools--and I made sure he understood full and well how many brilliant people that came out of my state university. My own kids are in a situation where we will not qualify for any aid, but we are better off than my parents and they don't have limitations on where they can apply...though with reason. We still need to have a cost-benefit analysis. $150k isn't rich for DC or California, especially if a family has multiple kids--housing costs are through the roof, COL is very high, but they still won't qualify for FSA. That's how it works. |
Anonymous
Can you explain the life time earnings discrepancy between T10 graduates and kids graduating from regional universities? Maybe where you go does matter |
Anonymous
Being able to pay $15-20k per year per child is a luxury. And I say this as someone who will have that amount and then some! But the UMC can be so out of touch with what actual median income earners can save, especially if they have any other obligations like medical expenses, special needs kids, etc. The cost of college has far out paced inflation and real wage growth, and you all act like it's some moral failing that more and more families can't keep up. |
Anonymous
+1,000 The trajectory of college tuition does not mirror the trajectory of salaries in the US. Colleges have become like country clubs. The amenities are ridiculous. State of the art fitness centers, millions of dining options, free exercise and yoga classes and wellness centers. All of this to attract more students while driving up the cost of tuition. BUT MORE IMPORTANTLY: its financial aid that has driven up the cost of college tuition. They know people will borrow. Ironically, financial aid, which is supposed to make higher education more accessible, could actually contribute to rising college costs. President Reagan's Education Secretary, William Bennett, began to speak about the phenomenon in the 1980s. It became known as "the Bennett hypothesis," after he published a New York Times op-ed called "Our Greedy Colleges" in 1987. President Obama also acknowledged the issue during his presidency, but the problem persists. According to some estimations, for every new dollar of federal student aid, tuition increases by up to 65 cents. Tuition and fees at private National Universities have jumped 134%. Out-of-state tuition and fees at public National Universities have risen 141%. https://www.usnews.com/education/best-colleges/paying-for-college/articles/see-20-years-of-tuition-growth-at-national-universities#:~:text=Tuition%20and%20fees%20at%20private,National%20Universities%20have%20risen%20141%25. Over the last 20 years, the cost of college tuition at nonprofit institutions rose more than any other U.S. consumer good or service besides hospital care. Now, a college education is the second-largest expense a person will likely ever make, right after buying a house. The cost of a college degree in the U.S. supersedes any large country in the developed world. In 1978-79, it cost $17,680 per year to attend the average private college and $8,250 per year to attend the average public college, after factoring in inflation. Forty years later, those respective costs increased to $48,510 and $21,370. This constitutes a 174% increase in tuition at private colleges and a 159% increase at public colleges. And these rates show no sign of slowing down. https://www.affordablecollegesonline.org/college-resource-center/news/what-factors-are-driving-rising-college-costs/ |
Anonymous
So realize that there are plenty of schools (both private and public) just below the elite level and many offer great merit. So you can't afford $82K. So focus on finding the best you can afford. Even if you can afford it, many many many smart, highly talented kids with 4.0UW and 1550+ don't get into a T20 school. It's life. You are not entitled to anything. If you are really so smart, you should know that where you go does not matter as much as what you do when you get there (as well as if you can do it while not going into any or major debt). Your kid will do better if they are not straddled with debt and are not mentally stressed because they are not going to an elite school. |
Anonymous
The "kids graduating from regional universities" who had the stats for T20 schools are not that different from the kids graduating at T20 schools. They have the drive/motivation and typically do excel wherever they go. |
Anonymous
Funny, we managed to save for a 4 year state school plus room and board and a little extra on much less than that. No family help. We saved, don't take a lot of vacations (every 4-5 years at best), and live in a sh#t shack. It can be done if you want to. |
Anonymous
Where’s your sh-tshack and when did you buy? We have one too (silver spring) really need to trade down even further to free up cash for college cause we got two kids. Sourcing for new ideas. |
Anonymous
But actual median income earners are not the donut hole families this thread is about. The donut hole families are the ones that (mostly) earn enough income to make choices whether to save or not. I get that there are exceptions for families that have unusual expenses (medical, eldercare, etc.) or only recently started earning at a particular level. I always suggest reading the price you pay for college. There is an affordable options for most students, it just may not be their first choice. Donut hole families that want their children to have their first choice need to make the choices to pay for it. That is simply the reality and no judgment if you cannot but not a lot of sympathy for those whining about it. We can pay. We have one car, not fancy. We have some nice thing but not all the nice things. We make a good income, our kids go to public school and feel lucky they have the choices they have. Many of their friends do not have the same choices. All of their friends will get good educations, but cost and financial and/or merit aid is a factor to most. |
Anonymous
Questioning where you live and smug attitude of this poster. The ONLY person I know who doesn’t fret about tuition is a self made deca-millionaire I happen to know through an acquaintance. With tuitions growing 19% per year I call you a trust fund baby feeling smug more than a saver. A saver who has in state tuition for 2 kids covered and is STILL concerned. |
Anonymous
Too late for you guys if your kids are older, but just start early. Transfer your daycare bill to college savings and see how fast it adds up. Like with all things saving related, the real resource is time. |
Anonymous
|
We are a donut hole family. Kid with health condition meant one parent stayed home for longer than planned when kids were only hypothetical. Then one parent had cancer. More time away from the workforce. We are all okay now and both parents work full time and have decent incomes, but that’s only been for the past 2 years and college is close. We’ve saved what we could, lived in a small place, don’t have a lot of luxuries, but if we’d both been able to work since our child was a baby at a comparable income to what we have now, we’d have far more saved.
So don’t be so quick to judge - some of us are doing the best we can under tough circumstances. Will definitely be considering schools that can give merit aid, etc. No decent in-state option in DC. We will figure it out. And we don’t expect to be looking at schools that only give need-based aid. |
Anonymous
Zero judgement. If you have not already, read The Price You Pay For College. If your kid is a strong student, Pitt is a great option that gives merit that can be combined with DC TAG, applying early is key for merit aid. It will be under 40K/year for our DC and an excellent school with happy kids. Still waiting on other decisions but it is a good value and strong contender. There are also some DC specific scholarships such as the posse scholarship. |