Bank of Mom and Dad Closed! What about 50K a year tuition?

[garchbrooks]

Quote from heech:

Now we're just speculating. But this is interesting, never heard of the home price/income ratio.

By the way, article states the home price was $1.5mm.

Ah, maybe you're right.

Yeah, if you ever want to figure out how much someone is making, a good statistical way to calculate it is to take their home price and divide it by the local median price to income ratio -at the time- they purchased it, which you can generally figure out from Zillow.com.

In Chicago, it's been historically 3, but the housing bubble pushed it to 4. It's drifting back down to 3.

There's always outliers and people who act weird, but the numbers give you good ballpark info. As a guy who fancies selling used cars, I use the rough estimate from this to guess expenditures and the rough amount of payment that a person can float, then shoot for 15% more. There's a sort of confidence interval on what people at a given income have in terms of tastes and demands, and you can generally push the limit to the upside.

 

[the1]

It's definitely both. They do have a superior program but the connections you make along the way have more to do with your success than the additional knowledge you gain.

Quote from 700express:

A degree from Johns Hopkins will probably make those children more than enough to pay off the cost of going there.

Sometimes, college is more than finding the cheapest school. You don't learn anything if you aren't compatible with the school, and sometimes there's more to a school than pure academics, such as connections. Do you really think Harvard teaches business that much better than most good state schools? Or do you think that the connections gained from the HBS is what really helps? Maybe both, I don't know. Just speculation.

 

[peilthetraveler]

Quote from heech:

I live in California, and my total income tax payments (including state) ends up being ~36% a year. From his $550k, he was taking home $350k.

I believe his mortgage was $800k, at 6% translates to ~$50k (tax deductible). He still has $300k, a year.

If all he could save was $250k before his kids turned 18, then I certainly question his priorities.

My take home pay is in the low 50k range. I live off about 35k per year supporting 4 of us. We live in a small brand new house, but drive a 10 year old car and we dont really go without anything except we dont usually eat out at restaurants, or buy expensive clothes. The guy was living high on the hog. He could've lived a normal middle class life for 10 years living off 50k per year and saved 300k per year there by having $3 million at the end of 10 years(assuming he made 0% interest but really he would've had more than 3 million). From there if he just got a 5% return from dividends on investments he would have $150k income for the rest of his life. His lifestyle would go up 200% and he wouldnt have to work or worry about his daughters for the rest of his life, not to mention like most people who retire and have trouble living on 80% of their income, he would have no trouble living on 200% of what he was used to.


I really do not understand how some people can be smart enough to make 500k per year but too stupid to think about retirement or saving for the future.

 

[TraderZones]

Quote from KINGOFSHORTS:

http://finance.yahoo.com/family-hom...2xrA2JhbmtvZm1vbWFuZA--?mod=family-love_money

Holy shit! 50 Grand a year for 4 years 200K just to get a certificate to Apply for a job!

200 Grand!!!

Wow, So in 10 years is college going to cost half a million dollars?

And this??!?

"The family had to cut the four different specialized summer camps that each child attended, at a cost of $1,600 for all three children per week. And they've been forced to eat into a nest egg designed to support the girls as adults."


Wow Americans really have no clue how to grow net wealth and save for a rainy day with this kind of spending and borrowing to the hilt.

2 years at Community College $6,000

2 years at good state school in top major (Accounting, Nursing, Engineering, etc._ $22,000

TOTAL: less than $30,000

And with the Hope Tuition Credit, $2500x4, you get $10,000 back

throw in scholarships or other things, and you could be looking at $13-$18,000 total

Buy all texts on Amazon or Alibris used and immediately resell after semester open, your cost is basically the cost of books shipped to you...

Live at home with Mom & Dad - I did first 2 years. They put nothing towards we kids' tuition.

College is only expensive when you refuse to plan.

 

[peilthetraveler]

Quote from TraderZones:

2 years at Community College $6,000

2 years at good state school in top major (Accounting, Nursing, Engineering, etc._ $22,000

TOTAL: less than $30,000

And with the Hope Tuition Credit, $2500x4, you get $10,000 back

throw in scholarships or other things, and you could be looking at $13-$18,000 total

Buy all texts on Amazon or Alibris used and immediately resell after semester open, your cost is basically the cost of books shipped to you...

Live at home with Mom & Dad - I did first 2 years. They put nothing towards we kids' tuition.

College is only expensive when you refuse to plan.

+1

 

[cactus_trader]

-if you have a parent work at the school/college/university sometimes they offer discount or free tuition

-if you do not want to live at home, become an RA (free rent and meals kicked back)

-get a job that offers tuition reimbursement

-I had a full time job while in college (not working at SBUX either, but working a high paying tough sales job at a big corporation) non to less, get a job even if it is working for peanuts while in school and pay as you go

 

[noob_trad3r]

How is college outpacing medical costs?

 

[clacy]

Quote from noob_trad3r:

How is college outpacing medical costs?

Good question. At least with medical costs we get a longer life span, with a higher quality of life, as technology advances.

I don't think our students today are getting a better education than they were 20 years ago, and many would argue it's worse.

 

[spinn]

Quote from peilthetraveler:


I really do not understand how some people can be smart enough to make 500k per year but too stupid to think about retirement or saving for the future.

Best post ever on ET. I live in a wealthy part of Washington DC and the people who have the most money dont even seem to work. i am not talking retired, I am talking mid 30s with a job as a secretary or manager living in a 750k house...paid for with money from parents. And of course thousands of women who have never worked in their lives, driving new mercedes living in $2 million houses. Annoying.

 

[ashatet]

I can see why housing got expensive. Too many overpaid lawyers and benefits of the workers.

I can see why medical costs are out of hand. Overpaid doctors and too many lawyers.

What I can not figure out how it is that the college has gotten so expensive. College professors are for most part making 100K or so.

Quote from noob_trad3r:

How is college outpacing medical costs?