Welcome to the panic room. It’s more of a state of mind than an actual bedroom and usually infects parents of college students as their children enter their junior or senior year of high school; the looming cloud of college selection and the daunting task of how to manage college expenses without destroying retirement.
Interestingly, there is a very logical approach to this dauntingly expensive and complex task, which can eliminate much of the pain and anxiety. A first-things-first system works for most endeavors, and college selection and planning is no different. It is the heart, head and hands approach to the university.
Think in terms of building a house. The first thing you can do is begin to imagine the qualities you would want. The number of bedrooms and bathrooms, the size and style of the kitchen and living room, two stories or a rancho, and the ideal location. This is the dream. This is the HEART.
The next step might be to start separating needs from wants to identify the minimum standards by which our home should be built. If we have a particularly large family, we may need a certain number of bedrooms and perhaps a large garage to store things other than cars. We can also expect to run a small business from home, in which case we should consider a home office. This is the practical article. This is the HEAD.
Finally, accepting that the bank account is not an endless supply of resources, we must begin to assign value to our wants and needs in order to recognize, prioritize, and finalize blueprints. While we may want granite countertops, the quote may only take textured and stained concrete into account; an acceptable alternative. This process is the financial evaluation where we define the budget. This is the HAND.
Now think in terms of building a college plan. The Dream: What school, regardless of cost, convenience, or any required measure of reason, would our student want to attend? What about the second most desired school? A third and fourth option are welcome. This step is simply about prioritizing your school choice based on criteria that may or may not be rooted in any standards of your reality or perceived financial constraints. This is the HEART.
With that list developed, we now take a very different tack. We apply reason to our selection. The most efficient way to select a school is to first understand the desired outcome of earning a degree. With few exceptions, that desired outcome is a career in an area of particular passion for the student. Pursuing a career in an area in which the student does not demonstrate or express any particular passion will serve to frustrate, irritate and ultimately force the student to change. The change will be in her career or her sense of happiness, neither of which are particularly comfortable undertakings. If that change is recognized while in college, the focus of the degree can change and that invariably adds time and cost to the process.
Once the race is understood as the goal, the race or races that could best lead to that race are identified. Schools that offer that major are a natural extension that allows us to build a list of qualified schools. From that list, all other criteria can be applied. These criteria can include any number of characteristics, including school size, location, student-faculty ratio, even the quality of food on campus. The short list of possible university options is born. This is the logical approach to college selection. This is the HEAD.
Finally, and probably the most intimidating element of developing a college plan is the financial aspect of higher education. Unfortunately for most parents, financial advice or college-related truths can be largely guided by myth.
In general, there is a great misunderstanding about eligibility for financial aid. Too often it is assumed that qualifying for financial aid is reserved for families most in need. In fact, financial aid in some form is available to almost every family, regardless of wealth or income. Therefore, the first financial step for a family to take is to fully understand their eligibility. A visit to the FAFSA is a great first step.
Another common misconception is the assumption that public school is a less expensive alternative to private school. While it is a great truth that the price tag of the university can adhere to that rule, the actual out-of-pocket expense can produce a significantly different picture. When aid eligibility is factored in, the out-of-pocket expense for a private school that costs $10k-$20k per year more than its state-sponsored competitors may actually be less expensive. Without understanding aid eligibility, an unfortunate majority of parents and students will never recognize this opportunity.
Another factor to consider is the probability of graduating within 4 years. Statistically, there are a number of studies that suggest that private schools graduate their students within 4 years at a significantly higher rate than many public schools. However, most families forget to include the time it takes to earn a degree as a cost factor. Five or six years in a public school can end up costing more than 4 years in a private school, regardless of how they are able to offset the cost of education with their endowment funds. This process is the most powerful key to proper college selection.
Finally, a family must identify a budget for college. The timing of college expenses closely coincides with the start of retirement. If parents spend too much on college without recognizing the impact on their other financial goals, particularly retirement, they may not have time to recover. This holistic approach to the financial side of college is the HAND.
Instead of an act dictated largely by convention and the application of common tradition, college selection is much better approached with an educated plan. If a family uses the HEART, HEAD, and HAND approach, measuring wants, needs, and financial capacity, they will be handling a daunting task with great insight and will be much more likely to enjoy the fruits of their labor.