Category Archives: Costs

Why Being a Poser will leave you Broke

Honesty

Can we be really honest for just a minute? I have a question for you.

Are you a poser?

I’m guessing most of you know what a poser is, but if not, here’s what Google says…

Poser

Posers

So by Google’s definition, I’m guessing we’re all posers from time to time. Honestly, who doesn’t try to use money to impress others in some way or another? We buy clothes that may be just a little out of our price range. We drive nicer cars than we can afford so we lease them or take out loans. We buy dinner for our friends knowing that it’s going hurt later. Heck, even our cell phones say something about our status so we pay whatever we have to for them even if it costs us an arm and a leg.

Impressing other people isn’t cheap.

Sometimes we even feel such a strong need to impress others that we do it at great financial harm to ourselves. Take college selection for example.

As students start looking at colleges and begin to decide where they want to go, they have to process a lot of important school information: location, transportation, degrees offered, tuition costs, room and board costs, financial aid packages, work opportunities, etc.

The Elusive Prestige

Of course these are all really important and really smart things to be thinking about. But here’s the deal, 18 year olds aren’t only thinking about those things. If you’re going to college soon, chances are you’re thinking about less tangible, less quantifiable things; things like the culture of the school, the “fun-factor”, and how prestigious the school is.

A lot of high school seniors (and their families especially) are really concerned about that last one; prestige. Again, we turn to Google…

Prestige

Prestige is really, really important to a lot of students and their families when choosing a college. It’s as if certain colleges seem to be able to offer a higher level of esteem, respect, and status to their graduates. Highly esteemed colleges produce better quality graduates that are more desirable in the marketplace, right?

Certainly if employers knew you went to one of these highly respected schools they would be much more likely to offer you a job over the common shmuck that went to the community college down the road, right… right?

Well, probably not.

Honestly, employers are really not all that concerned with where you went to college. There are of course some careers that are an exception to this rule, but they are certainly not the norm. The truth is after you graduate college the only person who cares about where you went to school is you.

“Only the Best” Mentality

You’ve probably heard that you have to get into the best possible school that you can. This is taught to students all the time from teachers, counselors, and family members. Let me be the first to tell you, It’s not true. It sounds great but its horrible advice.

Better advice would be that you have to get into the best possible school you can realistically afford and that offers the best return on investment.

Just because you get accept to a prestigious school doesn’t mean you can afford it. It also doesn’t mean you should take out a life time of student loans to go there.

You really have to think these things through.

The kindergarten teacher who graduated with $150,000 in student loans isn’t going to be getting paid any better than the teacher who graduated with $10,000 in student loans. Remember, the only person who cares where you went to school is you.

So before you decide to sign on the dotted line and agree to take out a massive student loan in order to get into that super cool school, think about your motives. Who are you really trying to impress? Is their brief and passing admiration worth it? How super cool will it be when you have to pay $600 a month in student loans until you’re 40? How prestigious will it be when you have to move back into your parent’s basement after graduation because you’re broke?

Think about it. That’s all I’m asking.

As a guy who graduated from a rather expensive private university with a degree in education, I feel like I have a pretty decent understanding of this whole idea of getting a good return on investment for a college degree. I learned the hard way though. I spent too much plain and simple. I didn’t learn that until years later though.

So tell me your story. I’d love to hear your thoughts on this issue. Comment below to share.

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Education: Return On Investment

RROOII

A New Age

There was a time in history when a college degree would guarantee you a successful and profitable career. If you had a degree you enjoyed a nice big paycheck to go along with it. It was easy; a degree meant more money plain and simple.

That time has passed.

Sorry.

This is a new era. It is the age of college graduates who work at Arby’s. This is the age of graduate students who live in their parent’s basement. This is age of realization. It is a rude awakening. People are starting to realize that a degree isn’t the magic ingredient it used to be. A lot of the time it is necessary, but it is not enough. You can no longer flash a degree at an employer and expect money to be thrown at your feet.

A degree is a tool to help you shape your future. It’s a very expensive tool, but a tool nonetheless. Now, more than ever, it’s important to look at a degree as an investment in your future. When you look at an investment the one thing that simply cannot be ignored is the return on that investment.

What is ROI?

ROI (Return on Investment) is a performance measure used to evaluate the efficiency of an investment or to compare the efficiency of a number of different investments. Or more simply put, it’s what you’ll gain or lose from an investment.

An Example

If you look at a degree as an investment (which it is) then obviously some will yield a higher ROI then others. Let’s use the teaching profession as an example.

Two students from rural Indiana decided to follow their passions and become teachers. They both planned on returning to their home town to teach kindergarten in one of the local schools. They both got exceptional grades in high school and got great ACT and SAT scores. They had nearly every college and university available to them.

The first student applied to as many prestigious schools as she could.  She decided to go to a very competitive out of state college. She did not receive nearly as much financial aid or scholarship money attending this university. The degree was exceptionally expensive, but because she was accepted by such a prestigious school she thought she would be cheating herself if she didn’t go there.

The second student decided to go to a local community college. The college was small and fairly inexpensive. Because of her grades she was able to get some decent scholarships from the school. The school was not very well known, but she didn’t mind. The campus was close enough that she could live at home and because of that and her scholarships she didn’t need to take on any student loan debt to get her degree.

Upon graduation both student graduated with honors and were able to return to their home town and easily get a job teaching kindergarten in one of the local elementary schools.

Which student had the best return on investment from their degree?

Obviously the second student had the best return on investment. She was able to graduate without debt and start at the same salary as the first student who took on massive student loan debt to do the same thing. Both are going to be making about the same amount of money. Both are going to be kindergarten teachers. Both ended up in the same place, one just spent a lot more to get there. A quality education is important, but you shouldn’t be bankrupting your future to get it.

Earning Potential

You have to think about the earning potential of a degree. Why would a local elementary school in rural Indiana pay significantly more to hire an Ivy League grad than someone else with the same degree from a local college? Answer: they won’t.

There are a lot of noble and humanitarian careers that pay horribly. I would (almost) never discourage you from pursuing a career in one of those fields. They’re good jobs, but spending hundreds of thousands of dollars to get a job making $30,000 a year just doesn’t make sense. If you want to be a teacher, social worker, or some other equally underpaid profession, then you need to be realistic about how much you should invest in your degree (hint: less is better).

On the other hand, if you really want to impress people with you’re really expensive and prestigious degree then by all means ignore everything I’ve just written. I’m sure your co-workers won’t be able to get enough of your stories about how you went to an expensive Ivy League school.

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Awkward…

…and a little funny.

The young lady, Rachel Canning of New Jersey, who recently became famous for suing her parents for child support and tuition, has moved back in with mom and dad.  (In case you have no idea what I’m talking about, read the attached article.) Tuesday of this week she officially dismissed the complaint against her parents and there will be no more legal actions taken. Case dismissed.

And all the sane people around the world let out a collective sigh of relief.

Common sense prevails, for now.

Family Dinner

I can’t imagine sitting down for dinner as a family after this whole fiasco. How incredibly awkward and uncomfortable would that be? “Mom if you serve Brussels sprouts one more time for dinner, so help me… I… I will sue the pants off of you!” The whole thing is just weird.   Who needs sitcoms when you can just watch the news?

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Should I Live at Home or on Campus?

Home vs Dorm

To Dorm or not to Dorm, that is the Question

So you’re going to a local college. It’s close enough to live from home, but you could also live on campus if you wanted to. This is your first chance to live independently. Should you take it? You’ve been sleeping in the same room since you were 2 and now’s your chance to finally get out on your own. Living in a dorm is at the heart of the college experience. It’s where life-long friendships are made and world renowned fun times are waiting to be had. Yes, it’s going to be expensive but it’s all part of the college experience right?

But wait.

On second thought, do you really have to move out? Your room is nice. It’s free. It’s bigger than a large closet. It has carpet that isn’t just 9 different shades of stains. It’s yours. It already has all your stuff in it. It has a fully stocked kitchen at the bottom of the stairs. The laundry machine doesn’t take quarters. It doesn’t sound like a rock concert 24/7.  Oh, and did I mention it’s free?

Pros and Cons

Now you’re faced with a tough decision, “should I live at home and save a few bucks, or should I live in the dorms and get the full college experience?” Let’s look at the pros and cons of each.

Living in the Dorms

Pros:Dorms

Convenience: When you live on campus you can walk to classes, cafeterias, computer labs, libraries, and any other buildings you might need to go to. There’s no driving time or worrying about a vehicle.

Ease: Living on campus is very easy. You don’t have to worry about the bills. You don’t have to worry about utilities, rent, or grocery shopping. Everything is taken care of for you.

Social life: Living in the dorm is a great way to make new friends. You will be constantly surrounded with other people your age and will have a lot of opportunities to meet new people and establish new friendships.

Exposure: Living on campus will bring about a new level of exposure and will enable you to learn from people who come from different walks of life. Being surrounded by so many new people can provide opportunities to make valuable connections and learn new interests and passions.

Cons:

Less Privacy: If you like having time to yourself and need a lot of personal space, then living in the dorms can be a real challenge. You will have to share your bedroom, your bathroom, and your living spaces. There will be almost no privacy.

Small Rooms: You’re dorm room probably won’t be nearly as nice as your bedroom at home. Dorm rooms are usually tiny and you will have to really limit what you keep with you at college.  You may have to buy new (smaller) furniture to be able to live in your dorm.

Difficulty Studying: The huge increase in social activities and being constantly surrounded by friends can often force high achieving students to lose their academic edge. Some student’s grades drop dramatically due to difficulty focusing and not being able to personally enforce good study habits among the distractions.

Exposure: You cannot control your environment when living on campus. You may find yourself constantly surrounded by people with drastically different world-views than your own. Dorms are often full of activities that may go against your beliefs or that might make you feel uncomfortable.

Costs: Living in the dormitory can be expensive. This cost is usually wrapped up with the student’s loans and it’s easy to forget about them. Living at home is much, much cheaper.

Living at Home

Pros:Home

Independence: Living at home doesn’t always mean less independence. A lot of dorms have strict rules that students must live by while living on-campus. These rules are nonnegotiable. Living at home allows you to establish those rules with your parents. You can be a part of the discussion on how to best increase your independence as you transition from high school to college.

Increased Privacy: Living at home can provide greater levels of privacy. Chances are you won’t be constantly surrounded by other students at home. Chances are there won’t be parties 24/7 either.

Improved Grades: When you live at home you will be studying in the same environment that you did in high school. It will be a very smooth transition. There are a lot less distractions at home and you can have a greater amount of control over what distractions you allow in your life.

Social Life: When you live at home you can still have a great social life, and as a bonus benefit, you can have it on your own terms. Living at home allows you to go out and engage in social activities with friends and then take a break when you need to focus on your studies.

Control: Living at home allows for a greater amount of control of your surroundings. If you don’t like a situation on campus or feel uncomfortable, you can easily remove yourself from that situation. You also can choose the types of people you will surround yourself; and as you know, people tend to become like those they surround themselves with.

Costs: Living at home is cheap if not free. Who doesn’t like free?

 Cons:

Independence: You may feel like staying home during college is cheating you of a valuable experience. It is easy to feel like you aren’t really living independently while living at home.

Transportation: Driving to and from school takes up time. It also costs money and requires that you have a reliable vehicle or mode of transportation.

Isolation: Developing connections is an important benefit of attending college. If you tend to isolate you may miss out on some important connections living at home.  But remember, you don’t need to become a party animal. Being an introvert is not a bad thing.

Decisions

It’s a really big decision, but like most decisions it isn’t just option A versus option B.  You have more options than choosing between the college-experience or saving money. There are a ton of different options.

Maybe you will…

  • Live at home for a couple years and then finish on campus.
  • Live at home, but spend the majority of your time studying on campus.
  • Live on campus, but go home on the weekends to be alone or catch up on projects.

Don’t Forget

You need to remember why you’re going to college. Is it to make friends and live it up? Do you really need to pay for that experience? If you think about it that way it sounds kind of lame doesn’t it. But, that’s exactly why a lot of students decide to live on campus, so they can make new friends be a part of the scene. Imagine that scenario outside of the whole college experience mentality. “Can I give you a bunch my money and in return you let me hang out with you and go to cool parties?” Lame.

What would you do with an extra $30,000 at your college graduation? If you can save room and board fees of $7,500 a year over four years you have a nice chunk of change at graduation.

As someone who lived at home, on campus, and in my own apartment during college, I can say without hesitation that living at home is by far the most cost effective and easiest. My social life wasn’t hurt in the slightest by living at home and I was able to give my full attention to my studies. Dorms are expensive. Apartments are even more expensive.  Home is free.

If cost isn’t an issue for you and you really feel the need to live on campus, then go for it and enjoy. But, whatever you end up choosing make sure you choose it because it is what’s best for you.  Don’t simply take the path of least resistance. Don’t follow along blindly doing what everyone else is doing. Figure out what you need to do to get you where you want to be and do it. Be creative, remember normal is mountains of student debt and a degree you probably won’t use.

Don’t be normal.

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How NOT to Pay for College

There are many ways not to pay for college, this is one of them.

That is all.

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Free College

How would you like to go to college for free? No, I’m not talking about getting a full ride athletic or academic scholarship. I’m also not talking about college being free to you thanks to mom and dad’s 529 college savings plan. I’m most definitely not talking about college being free today thanks to student loan debts tomorrow.  I’m talking about going to a four year accredited university completely tuition free.Free College

Free college.

 It sounds mythical, almost like a fairy tale doesn’t it? Unicorns, leprechaun’s gold, big-foot, cold fusion, free college.  The words free and college shouldn’t even be able to coexist in the same sentence.  But, with the cost of a college education rising at over twice the rate of inflation, it’s seems like a pretty reasonable thing to look into. 

As a side note I will be sharing how to find a leprechaun’s pot of gold in a future post.

College of the Ozarks

Back to getting a free college education. Although it sounds too good to be true, there are a few accredited colleges that are completely free to students. Really, there are.  For example the College of the Ozarks offers a four year education at no cost to their students.  This excerpt from their site explains it pretty well.

“Each student participates in the on-campus work program for 15 hours per week and two forty-hour work weeks. Earnings from participation in the work program, plus any federal and/or state aid for which students qualify, plus a College of the Ozarks Cost of Education Scholarship combine to meet each student’s full tuition charge.”

Or if you’re a visual person, it breaks down like this:

Cost of Education: $17,900
College of Ozark Work program: -$4,116
College of Ozark Cost of Education Scholarship: -$13,784

Total Cost to Student: $0.00

Curtis Institute of Music

Another college, the Curtis Institutes of Music also comes at no cost to the student. Here is what they have to say:

“Since 1928 Curtis has maintained an all-scholarship policy. The Curtis Institute of Music provides merit-based full-tuition scholarships to all undergraduate and graduate, students, regardless of their financial situation. For the 2013-14 school year, the annual value of this scholarship was $37,600 for undergraduate students and $50,100 for graduate students. These scholarships are renewed each year of a student’s enrollment. No financial aid application is required for the full-tuition scholarship.”

Berea

Berea is yet another example of a college offering a free education. All individuals admitted to Berea get a full four year tuition scholarship. According to their website, for most students, the 4-year tuition scholarship amounts to nearly $100,000.  How do they do it?

We are able to provide this level of financial assistance due to the generous support of alumni, friends, organizations, and others who believe, as we do, that a student’s income should not dictate their outcome. So when you enroll at Berea, your scholarship will be provided by people you don’t even know who believe in your potential—and who know that Berea is well-positioned to help you realize that potential.”

 These colleges are not alone. There are others that offer similar deals to their students. Is this the norm? Definitely not!  To be honest, it can be very difficult to get into some of these colleges. Curtis is an exceptionally elite school. Berea and Ozarks also have very limited availability.  But there are other options available for a free education.

 West Point and other military academies offer tuition free education; however, you do have a required period of service following graduation.  Here are some other examples of tuition free colleges:

Alice Lloyd College
Webb Institute
Deep Springs College

College doesn’t have to be a massive financial burden to you. There are ways to go to college without taking on a ton of student loan debt. Time spent looking into alternatives is not time wasted.

 

 

 

 

 

 

 

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Honest College Commercial

Honest Commercials has done it again. Meet Every University. A little over the top, but unfortunately its not too terribly far from the truth.

Enjoy.

Agree? Disagree? Share your thoughts below.

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Stupid Degrees

Benjamin Franklin once said “The only thing that is more expensive than education is ignorance.” The thing is, Ben probably wasn’t talking about a degree in puppetry. You see, not all education is equal. 

Puppetry

The University of Connecticut offers both Bachelor’s and Master’s degrees in Puppetry.

Just because you spend tens of thousands of dollars earning a degree doesn’t mean you are instantly valuable in the marketplace. I’m sorry but the only thing you’re going to be able to do with a degree in European medieval history is teach European medieval history, that or work at Starbucks.

It’s unbelievable the majors some colleges offer, for example:

Pop culture – Bowling Green State University (Hipsters need not apply-too mainstream)

Adventure Education – Plymouth State University (wha!?)

Canadian Studies
– Duke (again… wha!?)


Floral Management
– Mississippi State University (pretty flowers go in the vase 101)


The Beatles
– Liverpool Hope University (I love the Beatles, and now I’ve got a degree to prove it…)


Puppetry
– University of Connecticut (Sesame Street here I come! Wait, your not hiring… uh oh.)


Comedy
– Humber College (either you got it or you don’t…have you ever asked to see a comedians resume?)


Nannying
– Sullivan University (with an average annual income of $19,190 in the state of Indiana i’m thinking a degree might not be necessary)

Before you spend a fortune on a degree you need to have an economic model in place to earn an income. Make sure that economic model fits your life plan as well.

One of the podcast I listen to from time to time is the Dave Ramesy Show. The following clip is from his radio show and it is about this exact subject. Sometimes Dave gets a little worked up and this is one of those times.

Enjoy.

Please leave me a comment and let me know what you think.

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Rachel Cruze on College Debt

Overwhelming college debt is an epidemic problem. Students are taking out massive debt to go to college, often without even having a plan in place to pay it off. This is nothing new, but the problem is not moving in the right direction.  College costs are increasing at a rate that is disproportionately higher than general cost of living increases. College is great. College + crippling debt is bad. What are you going to do?

Rachel Cruze shares what I think is an excellent plan.

Common sense.

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Money: How Much Do You Want?

Money

Money is important.

That’s right, captain obvious to the rescue. But seriously, money is important. It took me a long time to come to that realization. Some of you may be thinking, “What is this guy talking about?” others of you will get what I’m trying to say.

I remember when I was in high school there were basically three mindsets about money among my friends. At this point I should probably give a little background information to paint a better picture of who we were. My friends and I were the high achievers and we did pretty well in school. We took all of the AP and college prep classes. We did a lot of extracurricular academic activities. We were the good kids.  We were the smart kids- kind of. We also had wildly different opinions with regards to money and the future, but basically we all fit into one of these three categories.

  1. “Money is da-Bomb!” (yes, we actually used to say that)
  2. “Money’s for sell-outs and tools; follow your heart!”
  3. “Money, um… I dunno.

Maybe you fit into one of these categories too.

In high school I happened to fall into the second category. Follow your heart and forget about the money. It seems like the most decent of the three doesn’t it. I certainly thought so and I didn’t hesitate to let everyone else know that it indeed was the noblest way to look at things. As I mentioned here, when I was planning my future career path, I took money out of the equation and chose to do what I felt passionate about: teaching and eventually social services. The problem was I didn’t really have an economic model in place to fit the lifestyle I was hoping to live.

It took me a long time to realize that.

It took me even longer to realize that it is okay to make money.

Again, some of you are thinking, “What in the world?” Others are nodding their heads in agreement. That’s okay, stick with me.

Have you discovered your passion, recognized your talents and found that you want to get involved in a traditionally low income vocation such as teaching, social services, or counseling?  Great!  You’ve done the hard work of looking inward. Now you get to do the fun stuff and look outward.

Teachers

At this point you need to realistically decide how much money you want to make. Don’t you dare say “I want to make $30,000 a year because that is what teachers in my area make.” If you start doing that you are not being honest with yourself. I know this because this was me.  If you’ve been honest with yourself thus far, trying to figure out your passions and your talents, why lie to yourself in this area? Now you’re thinking, “I’m not doing this for the money!” Again, this was me. I thought that if I made money doing something it would take away from the fact that I was trying to help and serve others.

If you are struggling with this concept I highly recommend studying the principles of Rabbi Daniel Lapin in his book, Thou Shall Prosper: Ten Commandments for Making Money.   Rabbi Lapin states that people often fail to reach their financial goals and potential due to a belief that money is materialistic and an unfortunate necessity. He proposes a change in mindset. He calls money a certificate of appreciation. He proposes that you look at the receiving of money as proof of your excellent service to others and not that you are simply taking their money.

Be creative; look for nontraditional career choices or consider going into business for yourself. Just because you want to work with kids doesn’t mean that being a school teacher is your only option.

At this point in the planning process don’t ignore your financial desires.  Ignore money and you won’t have any to worry about!

What are your thoughts on money? Is it something you are considering while trying to decide what field to get into? Is it the main thing? Do you think that prospering financially in your career is a sign that you are serving others extraordinarily well? I’d love to hear your thoughts on this subject.

Remember:

A fulfilling and profitable vocation is made up of three things: passion, talent, and an economic model.

Your economic model is one part of a three legged stool. If you don’t spend the time needed to figure it out the other two won’t hold you up.

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