2/23/2011 11:37 AM ET|
Is the Ivy League a waste of money?
This may not be an issue for actual Ivy Leaguers. As college student Zac Bissonnette points out in his provocative book "Debt-Free U," graduates of Princeton, Harvard and Yale are among the students who graduated with the least amount of debt in U.S. News & World Report's 2006 study. That's probably because the schools have generous financial-aid packages to lure the students who might not otherwise be able to afford the costs, while many others who attend have rich parents.
But cost is an issue for the vast majority of families whose kids don't get into the Ivies but who may be lured by a "dream school" that charges a small fortune or that provides inadequate financial aid. Just look at the list of schools from the same U.S. News study whose graduates left with the most debt:
- Seton Hall University
- New York University
- Worcester Polytechnic University
- University of North Dakota
- Pace University
As Bissonnette rather delicately puts it, "none of these institutions is likely to stand out on a résumé to the extent that Yale, Harvard or Princeton might." In other words, these students -- and others who attend expensive schools that aren't in the first tier -- may well be paying a premium for an education that doesn't justify it.
I'm not concerned just about the Leah Cowels of the world -- the students who overdose on debt. Cowels accumulated nearly a quarter of a million dollars in debt attending Ithaca College in New York to get a bachelor's degree she never used. And she's far from alone, as the testimonies on sites such as StudentLoanJustice.org can attest.
I'm also fearful for the parents who may drain their retirements and home equity, or pledge themselves to a life-shattering amount of debt, to buy their kids an education.
In too many families, discussions about what is and isn't affordable don't happen until the acceptance letters -- and the painfully inadequate financial-aid offers -- are in hand. And that's way too late.
By the time your kid is a freshman in high school, you should have a pretty good idea of your resources, including your savings. You can then go to the financial-aid calculator at FinAid.org to estimate how much your family will be expected to contribute to your child's education.
Set limits now on how much you'll borrow through federal student loan programs. The most that students can borrow for an undergraduate degree is typically $31,000. Parents can borrow up to the total cost of an education through the PLUS federal loan program, but they shouldn't agree to any loan that would prevent them from saving adequately for retirement. Any loan bigger than that -- or any student loan that doesn't come directly from the government, with its federal student loan protections -- is a sign you're over your head.
Armed with those numbers, you can start searching for schools that fit your budget.
If your kid does get into an Ivy League school, congratulations. Chances are pretty good that its financial-aid programs will make the tab affordable, especially now that many of these schools have adopted "no loan" programs that award grants and other discounts.
Otherwise, be wary. In education, you don't always get what you pay for.
Liz Weston is the Web's most-read personal-finance writer. She is the author of several books, most recently "The 10 Commandments of Money: Survive and Thrive in the New Economy" (find it on Bing). Weston's award-winning columns appear every Monday and Thursday, exclusively on MSN Money. Join the conversation and send in your financial questions on Liz Weston's Facebook fan page.
VIDEO ON MSN MONEY
The real advantage of Ivy-League schooling is - and always was - networking. An Ivy degree opens doors that others simply don't. This is most certainly not a good thing, but it is a fact. Especially in the professions, the "old-boy network" continues, though in a much weaker fashion than in the past. Excellent non-Ivy schools graduate more and more of our most talented men and women, and the gap is narrowing, but an Ivy education is still an asset that often has no relation to the quality of the graduate.
Disclosure: I went to a non-Ivy college and two Ivy professional/graduate schools; they were all good. The education I got depended more on me than on the schools. I studied for some courses like mad and slept through others. My kids followed the same pattern; we are all "well-educated," but those Ivy schools shine - if only on our resumes.
-President Obama (Columbia undergrad and Harvard law)
-President JFK (Harvard undergrad, Harvard named their govt school after him...)
-President Woodrow Wilson (Princeton undergrad, Princeton named their govt school after him...)
-President George Bush Sr. (Yale undergrad)
-President Clinton (Yale law school)
-President FDR (Harvard undergrad, Columbia law)
-Ban Ki Moon - UN Secretary General
-Bill Gates (dropped out)
-Mark Zuckerburg (dropped out)
-Warrent Buffet (Columbia MS, Upenn undergrad for two years)
-and a number of Nobel Prize winners in every category they offer (all Ivy Leagues)
This list goes on a on, but this doesn't mean there aren't very reputable state schools. Univ of Michigan produced President Gerald Ford. Stanford and MIT, although both are private, are basically ivys and produced the Google founders and other world-changing leaders. Actually, one Google founder attended Michigan undergrad and the other attended Univ of MD undergrad. I just don't think it is fair to bash Ivy leagues, or anyone institution, without the facts.
Please do research next time before you answer because for some reason 2 people gave your response a thumbs up. I don't want them to be misinformed. Also, I did NOT go to an Ivy league, but I don't discredit the type of education you can get there. Also their endowments are so big, you basically pay nothing or the same amount that you would pay for a state school.
Oh and Steve Jobs? I guess you define respectable by how cool of the products his/her company makes? Because Steve Jobs is nowhere to be found on any list of top philanthropists. Actually, when he became CEO of Apple, he took away "charitable contribution matches" at Apple as a cost saving measure and has never put it back. I am sure he gives in private but he doesn't win awards for savings lives like Bill Gates.
I did not realize that 1 + 1 does not equal 2 in non ivy schools. Higher education has become big business in America and it is now more about pumping out fee-paying customers, than delivering quality and knowledgeable students. With an ivy school, you are effectively purchasing a name and quite often at the tax payers expense; considering they're allowed to use public student loans.
How many Ivy League equivalent schools does China, India, Europe and so forth have? Yet look at the caliber of the student they are educating, and in significantly higher numbers as well. To the contrary, Harvard (for example) is able to pick the crème de la crème of students; which means, regardless of what is being taught at a school, such students will do extremely well anyway.
Uh, before you crack on people you need to keep you're own back porch clean.
Yes, it is true the President Kennedy graduated from Harvard, but you fail to mention that he attended LBE first, and then transfered to Princeton before ever ending up at Harvard. He earned a degree in Science, which had nothing to do with Governement. The Kennedy school of Governement is as much named for his Father and Brothers as it is for him. he also attended Stanford Business school, but withdrew. Seems to me that Kennedy moved around a lot, but only graduated when he was close to home and Daddy's deep pockets.
President Clinton went to Yale Law, but his undergrad was from Georgetown, afterwhich he was a Rhodes Scholar at Oxford. He is/was much smarter than Kennedy ever was.
It's important to paint a complete picture. You get out of college what you put into it...Period. I don't care where you attend. Perfect example--> President Carter. He started out at Geoergia Southwestern College, then transferred to Georgia Tech, then transferred to and graduated at the United States Naval Academy at Annapolis. Also, probably our greatest president in the last century was far from attending an Ivy league school. He attended Eureke College, and later went onto act in Movies and become Governor or California, and then the President of the United States...Ronald Reagan.
"They are perhaps the best-educated generation ever, but they can't find jobs. Many face staggering college loans and have moved back in with their parents. Even worse, their difficulty in getting careers launched could set them back financially for years."
Entire population is awash in debt! That is the problem. Current debt levels are still huge compared to GDP. History shows debt to GDP ratio will snap back to the mean. This makes a case for deflation to continue. In this deflationary environment the best thing you can do is to avoid going into debt! Stay away from debt and save your dollars. They will be worth more at the bottom of the coming depression. Google for CONQUER THE CRASH KONDRATIEFF WAVE to understand the economic problem we are facing as a nation.
Let's see...it wasn't UNeducated people who created weapons of mass destruction; or created industries or products that exploit the natural resources of the planet (which happen to belong to all the species over the entire life of the planet); or created the majority of the conditions which is leading to the death of this planet; or created the ONGOING suffering of people being raped or exploited. But, it is the Educational System which has failed to acknowledge the value (or lack thereof) of specific information, allowing anything which can be conjured up in the mind be manifested through archaic principles of self-absorbtion, self-indulgence, entitlement. If something didn't resolve the human condition in the past, it is not going to solve anything now. Time for a new look at 'knowledge.' To NOT do so, is corrupt. It is not a matter of free speech which will solve anything; but the freedom to choose the better option for the (human) species, which so happens is NOT going anywhere soon (en mass) off the planet. If the truth (only) is not taught, why teach anything at all?
don't know what Ivy League schools cost today or what kind of jobs graduates can find. But they use to pay off very well in the past.
But I went to an Ivy League school in the South which most of you have probably never heard of Rice University 30 some odd years ago and had like $24,000 of student loans and got a job out of college paying $40,000 a year. Not quite sure what I blew the money on but in 12 years I had the loans paid off and brought a house which has been paid off for 4 years now.
That $24,000 has more than paid for itself I figure I have made 1/3 more than I would have or about $600,000 more. growing $24,000 to $600,000 in 26 years is a rate of return of 14 percent much better than the stock market.
So unless you are getting a bad degree (money wise) like an art degree and can only find a $32,000 a year job and have $110,000 loan you should be breaking even or getting ahead.
George W. Bush is a first U.S president with MBA from Ivy League in our history. Most of the executives from Wall-Street, Finance and Banking Industries came from Ivy League.
Steve Jobs, Bill Gates, and may respectable leaders did not come from Ivy League.
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
RECENT ARTICLES ON COLLEGE SAVINGS
A new survey by MoneyRates.com gives a glimpse into what a little financial education can do.
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'