Free College for Rich People

I cannot remember another time in my fairly lengthy life when there was so much talk about colleges and money.  And it is spread over a wide spectrum of topics.  There is the student loan crisis, student loan forgiveness possibilities, the out of control inflation of college tuition prices, college admission bribery scandals, discussions about whether a four year college degree is becoming irrelevant, arguments over private versus public universities, whether elite colleges really pay out over time, community colleges versus four year institutions, and the value of online universities versus brick and mortar institutions.  

What I don’t hear much about is people whose experience has been as positive as mine.  I went to a public university in my own state.  It was less than fifty miles from the home I grew up in.  I majored in chemical engineering because I was that nerdy kid that never had to study. Tuition my first year was $250 a semester for a full load of classes, but I didn’t have to pay that since anyone in the top 5% of their high school class had tuition waived for the first year.  I think my dorm and food fees totaled less than $1,500 a year.  Books were maybe sixty bucks a semester.  My parents, middle class earners, just easily cash flowed those costs.  My brother went to an elite university, being the National Merit Scholar that he was, but that horrendous $1,400 a semester tuition was offset mostly by scholarships. We both graduated debt free with debt free parents who had already paid the house off early.  They were that kind, the kind that put cash in envelopes and bought absolutely nothing on credit, not even cars. 

When I graduated mid term there were 120 companies scheduled to come through the placement office looking for chemical engineers.  There were five or six of us graduating and almost everybody I interviewed with offered me a plant trip to interview for a job at their office or industrial complex location.  Almost everybody I interviewed with offered me a job.  It was like being a five star high school football player being courted by colleges. Business was booming and they were very short on engineers.  So, yes, I think my four year degree was an awesome value.  It made me millions of dollars in compensation over my career and allowed me to have jobs that were a lot of fun, most of the time. It didn’t put my parents or me in debt.  

But that was then and not now, so let us consider my three millennial kids who range in age from their late twenties to mid thirties.   What was getting them through college like?  Because I was a high earning millionaire when they graduated from high school we intended to cash flow their education at the same public university my wife and I attended.  Tuition, fees and room and board added up to about $16,000 a year per kid.   Or they would have if we would have had to pay for them.  But because my kids were genetically predisposed to be good learners and because my stay at home wife(her choice) made learning fun and held them accountable for their results, my kids were naturals at scoring high on college entrance exams and AP courses.  They generally were the curve setters in a very effective high school.  They weren’t National Merit Finalists but they had nice enough scores to make them attractive to State U.

 Something not everyone knows is that universities are desperate to grow their rankings in the US News poll,  often desperate enough in a poorly educated southern state like ours to offer free rides to gifted students.  And by free, I mean free.  Free tuition, free fees, free books and free dorm rooms and meal plans.  All from the state government coffers. Plus there were also smaller scholarships from my company, from young democrats or republicans(we had both) and from any number of other sources.  And these were not needs based or tested.  We were millionaires and I was earning well over $100,000. It did not matter. 

Another unique scholarship that only came along in time for our youngest provided free tuition and fees for five years to every student that graduated from our public school system.  Everyone got it, again, it wasn’t means tested.  A lottery scholarship also was created that helped on our last two kids, again, no means testing.  All three kids had to turn back money every year because there was no way to spend it on eligible expenses.  As an aside, I had informed our kids they could attend any college they could earn admission to. However, if they chose an institution that cost more than State U. then the extra cost was all on them.  They wisely chose State U.  

So that was the financial part of the equation.  What about the value of their degrees?  Kid one chose chemical engineering like his old man.  He excelled at it because he actually did study.  He graduated with zero debt, because, it was free of course. He got a job, got married and proceeded to put his wife through medical school.  Then he decided to become a doc too and put himself through medical school.  His four year degree did not lead to his career but chemical engineer is hella difficult and that no doubt helped him gain admission to medical school.  He is a cancer doctor now.  

Kid two also chose engineering, in fact she got two degrees.  The bachelors degree was free and she paid her own way through a masters in engineering by working for the university.  She is now a regulator in an environmental agency.  Its a good job with a lot of great benefits.  I think the free education was a solid investment in her case. 

Kid three was the rebel.  No way she would become an engineer.  She majored in business, graduated Summa Cum Laude and is an education specialist at a division one University where she helps athletes maintain their academic standing.  After the business degree she got a masters in adult education on her own money, and like her sister she worked for the university to pay for that. She even graduated with money in the bank.  She is working on a PhD at her university now so there is no telling where her career will go after that, but like her dad, she loves her job. Was college a good deal for her? No doubt, loving your job is not that common.  

You might be thinking this is just too weird, nobody gets free college for all their kids and then sees them go on to have meaningful and rewarding careers.  But that isn’t true.  I’ve met quite a few other parents and when we discussed what college cost I’ve found it was free for many of their kids.  A lot of boomers and Gen X parents never had to pay for their kids’ college. Much higher than the number who have received free college because of prowess at some type of athletics.  

But there are some choices you have to make to improve your chances.  You have to indoctrinate your kids with the idea that learning is fun.  They have to realize pretty early that nobody they know is going to make a living playing sports but that if they apply themselves to the hardest subjects in school then they are very likely to earn a much better than average living.  You also have to have conversations about why there is very little difference in the value of a degree from a school costing $50,000 a year and in one costing less than half of that. And they have to work hard at applying for scholarships like it is a paying job.  It is also important that they understand that all degrees are not equally monetizable.  If they choose a low paying field then they need to understand that going in.  I pushed engineering pretty hard because it has reasonable job satisfaction rankings and it also pays bank.  But my business major/educator is doing just fine and really loves her work.  And she made informed choices that led her there. 

 I realize college is not the best choice for every child.  You may have a child who would be better served by going into a skilled trade, coding bootcamp or entrepreneurship. It is up to you to encourage your child to pursue the things that they are most likely to succeed at.  My experience is you don’t chase passions, you chase what you can excel at and that will cause passion to grow.  As a parent a big part of your job is to help your kids figure out what those areas of excellence can be for them.  But if college does appear to be something that your kids will benefit from then try to do it for as little cost as possible, maybe even for free.

What about you, did any of you get free four year degrees or know of others who did?

What about the parents of millennials, what was the college experience like for them and you? 

Do you know people that chose not to attend college but are killing it anyway? 

As always if there doesn’t appear to be a comment box on your screen click on the title of this post at the top and it should appear.

16 Replies to “Free College for Rich People”

  1. Hi Steve, no free college here but in-state school with Army GI helped a ton. My oldest daughter has been cost conscience from day 1 and she should complete debt free.

    Today’s college experience has been downgraded due to COVID, but you can’t blame the schools or the students. Comparing almost anything to COVID times looks like a step back.

    Yes, I also work with great people with no college degree but I do think the road might be harder.

    1. Thanks Dapo, and thanks for your service. It is rewarding to see your child become a responsible adult, sounds like you did a great job raising her. It is a harder road I agree, but they do get a four year headstart.

  2. My college experience sounds similar to yours although I’m not quite as old as you but close. I went to state school because that’s all I could afford, mine was only 8 miles away. I couldn’t even afford the room and board though, so I commuted for the first 2 years. My tuition was $900. I got a $200 scholarship for scoring extremely high on the SATs, that was the only aid that I got.

    To me, college is what you make it, like anything else in life. I actually got a lot of knowledge out of college, but of course that depends on the quality of your instructors. I was lucky enough to have enough professors during my four years who taught me how to think, not what to think. It seems like more and more these days colleges are indoctrinating students on what to think, and not allowing freedom of thought and diverse opinions.

    I do think though as more and more extremely high-quality instruction goes online and for free, that colleges will continually become less relevant. Their value-add will be only in the social experience of being away from the parents and around people your own age, and less from the knowledge because that will be accessible online to anyone.

    1. I chair the board of trustees at a community college and one thing that surprises me is that tuition for online classes is typically as high and often higher than in person tuition. But surely competition will bring that down. I ofter bring up to the board that brick and mortar colleges are at risk. There is a demographic enrollment decline, a cliff really, headed our way in a few years as the population keeps filling up with guys like me live longer and millennials have fewer kids.

  3. When I went to college (2001), a few universities offered me significant academic scholarships, and had I taken one of these I would have gotten out with maybe $20,000 of total costs, which I would say is not too bad for the time. I (stupidly) picked the name brand private university, because my parents paid for it. It wasn’t stupid to choose that school, and it was a great experience for me, but it was stupid because I didn’t even put much thought into what I really wanted. Actually, if I picked one of the other schools I would have been a Chem E. also, but the fancy school I chose didn’t have an engineering program.

    Your story is comforting to me as I’m already worrying about my kids’ educations. We’re saving a decent chunk into their 529’s, since the sticker price for 4 years at the public universities here in VA are still in the $125k range. But hopefully we can knock that number down significantly with merit scholarships and the like. Or maybe college won’t be a thing anymore in 15 years, who knows!?

    1. Adam, it is crazy how the cost of college has escalated so much even in times of low cpi inflation. One thing about public colleges is they get a lot of political heat if they raise tuition. In our state the governor tells up how much we can pay professors and the legislature threatens to set tuition for us if we go up much in price. The private school market doesn’t have those handrails helping control costs. I think something will happen inside of 15 years. I think college may morph into a mix of distance and in class learning that will be much less expensive. Also I think there will be more targeted teaching so that it doesn’t take four years to learn accounting. Unfortunately engineering is one area where you can’t trim much, I only had 4 hours of free electives.

  4. Ugh- this is a topic that really resonates with me. I am about your age and graduated from a pricey private college back in the late 70s. Had a degree in political science which meant I was pretty much unemployable without an advanced degree. My parents paid for my undergraduate degree (was about $9,000 a year total) and I paid for my law school education. I should gave gone to a state school since I had no real career aspirations and any decent school would have served me well. Fast forward to my own three children who were all good students. The oldest was a national merit scholar and was offered full tuition to many 2nd tier colleges but it was not something we seriously considered since he was desperate to go to a top college- he wound up at Yale- and boy did he make the most of it. What a life changing experience for him- and career wise it paid off- works on wall street and back when he graduated the big banks really only recruited from very elite top tier colleges so I feel he would not have landed in a finance front office position if he had gone to lower tier colleges on scholarship. His earnings in his first 2 years far exceeded all 4 years of college expenses.

    Not to go on and on but the other 2 children had similar if not as extreme situations. Both very accomplished ( executive in entertainment field and last one in medical school). We paid for it all and it cost a lot- but at the end of the day we have plenty and we would do it again.

    I think the journey is different for everyone- and of course Covid has leveled the playing field since the life experiences , internships, connections you make and people you befriend at these elite schools becomes less meaningful when you are home learning on zoom. All of your points are well taken but each family is different and where they put their dollars and the value they see in each individual college as well as their child’s career aspirations all play a part in their decision making.

    1. I do think investment banking is one of the few areas where a top tier named college does pay off. But there are so few of those jobs available that for practical purposes they aren’t an option for many. But take med school, there’s a case where you won’t make much more with a degree from John Hopkins than one from Arkansas in most cases. It’s what you match in that sets your future pay. In engineering it is a totally merit based proposition, connections made in college don’t count for much, nor does the school you attended. But I agree, it’s what each family chooses. We are both happy with our choices and our kids’ prospects so far in life so I’d say we both chose wisely.

  5. Great job to you and your kids. Lots of good choices all the way around. I’m pretty unsympathetic to the entire cost-of-college whining out there. Like you said, it’s all about choices. My husband worked his tail off in college and got a full ride to a top-tier public law school. I opted for the fancy private law school, but I could have paid my loans off in no time with the salary I could have earned coming out. I ended up doing Public Service Loan Forgiveness, which is a great option for those of us who do take out hefty loans. My son is in a great state school for college, tuition-free because I’m a veteran, and California has some great benefits in that regard. He might be an RA in future years to eliminate housing costs. And worst case, any loans he takes out will be doable on a starting salary as an engineer. There’s also always the military option for the GI Bill. Every single one of these paths involves sacrifice somewhere–working hard for academic scholarships, going to public universities, working in college, working in public service, or serving in the military–but they’re options available to everyone, even the “rich kids.” Again, nice job.

    1. Thanks, the cases you hear about are the kids who racked up $200,000 in loans to get a degree in philosophy but I think those are rare outliers. You never hear about the people who managed college easily and paid their loans off responsibly because they picked majors that offer good pay and lots of job opportunities. I just wrote it because I hadn’t seen many people who made it through the college years, theirs or their kids’ without a huge struggle. Sacrifices, sure, as you point out, but they were planned sacrifices that people can enter into with their eyes wide open. Love the comment Mrs. FCB, it was better than my post!

  6. As usual, good thoughts Steve… I didn’t start to earn serious cash until my 3 kids were in their early college years or high school—I had two academically gifted kids and one who (like me) did the bare minimum to keep himself eligible for sports. This was 15 about years ago. Every year we looked at our finances, did the dreaded FAFSA dance — and realized that we made too much for need based aid yet not enough to pay for the whole thing from cash flow. We sat down with each kid, each year, and told them how much we could afford to give them, the rest was up to them. Generally that number covered approximately half of the total cost of a good state school. (In those days University of Michigan was about $23k for total cost of attendance). It was up to the kids to decide where they wanted to go to school, and thus, how much our contribution would cover their costs. One of our kids got a great deal from a private school in NYC, our contribution plus her scholarship covered the entire cost. Of course, she didn’t like it, transferred to the west coast to a very elite, small private school and our contribution plus her scholarships covered less than half of the cost of school for her. In the three years she spent there she incurred nearly $100k of student loan debt. Our youngest daughter graduated with less than half that number in debt from one of the best state schools in the country. Our son took some time off to travel the world after high school, then took the long way through college, graduated with around $30k in debt.

    All of them are now gainfully employed, but look back at their college choices differently. Youngest daughter had perhaps the best college experience, and a relatively low debt load with a prestigious degree from a so-called public ivy school. Oldest daughter had an interesting college career, graduated with a high debt load from a well known liberal arts college that did little to help her move forward in her career. Our son graduated with a middle debt load from a middling public school, enjoyed his college experience and enjoys his career as a teacher.

    Looking back , I don’t think I would have done much differently. I like the fact we were able to help with school costs, but also like the fact we didn’t just blindly pay their whole way. They had to weigh their opportunities and make choices that have consequences to this day. Ultimately, it was up to them and they had to own those choices.

    I think it is is much harder for families today, as even state schools have become prohibitively expensive for much of the population. As you note, the increase in costs in an age of low inflation seems crazy— yet the reality is that debt free education for most kids is a dream. In my mind we have to answer some questions as a society. 1) Should every kid go to college? 2)What jobs truly require a College degree? As a leader in a large Corp for many years, I tried unsuccessfully to fight the idea that even a starting-level clerk needed a college degree. 3)Should we more meaningfully reward public service (like teaching, public health, NGO service) with student debt forgiveness? The generation coming of age right now has a difficult road ahead, they’ll need some new thinking and less knee-jerk reactions from folks like me in order to thrive and succeed…

    1. Great comments Jack, the real test of our choices is just what you said. If, looking back, you wouldn’t have done anything differently then you absolutely did the wise thing. One of the things I loved about our company was that I saw coworkers rise to the VP level, which was a six figure plus place even ten years ago, and they had no college degree. What they had was talent and soft skills and leadership, gobs of leadership ability. I always thought that was so cool, and it needs to happen in most companies, not just the unicorn place I worked.

      One option I didn’t take, nor my kids, is community college. I’m a trustee at our CC and for almost all of our students it is completely free. And generally speaking most of the courses students take the first two years are pretty generic and are taught about the same no matter where you go to school. It doesn’t work out for someone doing engineering sometimes because unless its a huge CC they may not offer the advanced math and science but it does for many majors.

  7. i started on a full academic scholarship in the 80’s. the school was a large public university in virginia and they really did have to compete for higher scoring students like me. this was before the days of gaming the SAT with prep courses in our rural area. we just sat down and took the test.

    i have written previously about many top schools with not student loan component to aid. it would probably not have done any good at your higher income level but for middle income it’s a pretty good deal. if i was making 70k and my kid could get into williams college or an ivy i would send them there if i thought the cultural fit was ok. in my experience the world really is set up for the middle class to have some advantages. you gotta know where to look for some of them.

    i hope you don’t end up shoveling too much snow down there this week.

    1. Freddy, nobody has a snow shovel down here so none of that! I think the number of people of all income levels that end up with much of college paid for is much higher than people think. I wonder if that’s true now or a thing mostly of the past?

  8. I’m slowly catching up on your past posts Steveark – and some very good ones I should add. I forget people close comments so that if I read at a way later date I can’t put in my two cents – not that it’s worth anything and anyone is really expecting it… hahaha. But I first wanted to say condolences for your two friends. For whatever reason, I’ve been around a lot of death in my life. It never gets easier, but I do get better at handling it. That said, it always has a sobering and dramatic effect on me. There’s just no way to avoid it and grief has to play out naturally over time.

    College for me was never free. I attended a state university for undergrad like you, which in retrospect was a good choice. For some reason I never had a desire to attend a private university for undergrad at all. I came out with some student loans but rates back then (2001-2004) were 1.85% so it was no big deal. For my MBA in grad school (which was way later in 2011-2013), I did attend a private university – though for MBAs state schools pretty much charge almost the same. I made the decision to work while attending night school and I also had half of it paid for by my employer. So I never took out loans and came out debt free. It was hard work at the time balancing school and my career, but I learned a ton in those years about how hard I could push myself and succeed.

    1. Q, thanks, that means a lot coming from one of my favorite bloggers! I thought about going to law school after I had been out a few years. So much of my work ended up involving contracts and regulations I almost felt like a self taught one. But having three kids by the time the idea came up made it pretty impractical in a one income home. I never regretted not going back to school, I came to realize it was the technical part of engineering I enjoyed more than the legal aspects of my jobs. I can’t imagine how tough getting a degree while working a full time job was, that took some grit on your part for sure.

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