We have a government-run loan scheme called HECS. You defer your university fees throughout the duration of your studies, apparently no matter how long they last. The programme is not means tested at all, so it is available for every single domestic student studying uni here, no matter what.
That loan is then paid back only once you start earning more than a threshold amount of taxable income (this year, $51,309 - it's not a low income by any stretch) and the payment amount is graduated depending on how much over you earn, from 4% of your income at that threshold amount to 9% once you hit $95,288 or above [1]. There is no real interest charged on the debt - the loan is only indexed to CPI every year, so that the real cost of the loan amount doesn't change. The repayment is treated like tax - either taken out as you earn your wage or squared every year upon doing your tax return.
The perk that rich people get is that if they pay their bill upfront (that is, each semester as they study), they get a 10% discount on the total cost of the tuition for that semester (apparently, off memory it was 25% when I went through about 5-10 years ago). If you put it on HECS, you instead pay the full amount.
Oh, and also for every domestic student, a semester of full-time study costs on the order of $3000-$5000, so a 3 year degree is about $18k-$30k of the above debt [2], depending on what you study. It's heavily subsidised by the government.
The system is funded, in part, by international students, who pay the full fee amounts (no government subsidy) if they choose to study here.
The major criticism of the system is that students can just incur this debt then flee the country. If they earn no taxable income here, they never have to pay it back no matter how much they earn overseas. I can't really think of an easy way to resolve this because it's impossible to garnish income from another country. Nevertheless, the system works reasonably well.
[1]: http://studyassist.gov.au/sites/studyassist/payingbackmyloan...
[2]: http://studyassist.gov.au/sites/studyassist/helppayingmyfees...
Do you have any stats on how much HECS is lost in this manner? I've not heard of this being a big problem. One of my friends is in this category - he got a PHD scholarship at a top institution in the UK and isnt likely to return to Australia anytime soon. But I'd have thought the overall impact of brain drain (Australia is generally not a good place for top end R&D [1][2]) would have a far greater impact on Australia's future than an unpaid $30k HECS debt.
That all said, HECS is an amazing system and we are so lucky to have it here. I remember as a teenager when I first learnt that you had to pay upfront to go to college in the USA. I thought it was bullshit. What happens if you're poor? It seemed so ridiculously unfair that I thought it must be false. Oh the innocence of youth.
edit: urgh, sorry about the paywall. Go via google and you'll bypass it.
[1]: http://www.theaustralian.com.au/higher-education/universitie...
[2]: http://www.theaustralian.com.au/australian-it/brain-drain-mu...
I don't know how significant that 'leak rate' is though, so I can't put a figure on whether it's stressing the funds or not.
All kiwis can get a student loan, which you can put class fees, some living costs and a few other expenses under. You can also apply for a student allowance which you don't have to pay back, but you have to qualify (e.g. you and your family are poor).
With the student loan, it's a no interest loan as long as you're in the country. If you leave it defaults to a normal loan (not sure the % is).
While you're working and make over a certain minimal amount the govt takes 10% of your income to pay it off.
I'm not sure how much it is now, but I graduated in 2006 with a BSc in CS and my loan was somewhere around 21k.
The weirdest part was the means testing to make sure you were 'independent' and hence eligible to recieve the government money regardless of your parents assets. My parents werent poor but they were in no position to pay my living expenses whilst I went to uni.
Proving you were independent involved showing you'd worked full time for over a year or earnt a massive amount of money in a short period of time (I cant remember exactly but it was around $15k).
I worked 12 hour days at a factory over the summer break for 2 and a half months and with some other part time work managed to meet the income requirements. I started uni with a very healthy bank account.
I just thought it was somewhat weird that I had to work so hard and earn so much money...so I was eligible for the government to give me more money.
Low interest loans are not the worst idea if people actually stop to ask themselves if their major will provide the enough income to pay them back. They avoid the flee the jurisdiction problem an the waste money on a useless major problem.
Its reasonably rational to pay the money to go to Stanford for CS even if you pair full freight. It's probably not economically rational to do so for sociology.
The problem of course, in the US, is that no one asked themselves if they could afford to pay back the loans given what they intended to do. Its some mass collective delusion.
The other problem, is that every time they up the amount for federal student loans, universities up their tuition to match.
Honestly I think the brain drain is the biggest downside to Australians moving overseas after higher education, it's hard for me to move back after seeing the opportunities here.
http://www.businessweek.com/articles/2013-08-07/the-u-dot-s-...
That second narrative gets you rage views and votes for office, pretty much without regard with evidence to the contrary. Students can get a college degree at state schools for about the same cost as buying a new car, and on much more favorable loan terms.
That said, there are lots of ways we could improve how we grant student aid, in my last letter to my Senators I suggested that providing need-blind aid for STEM degrees (Creating in demand workers and part of the alleged worker shortage) would serve the double benefit of both getting people college degrees, and getting employers the legal resident college graduates they seem to so urgently desire. It is a simple idea but if you subscribe to the idea that tax payer funds should be allocated for the improvement of the citizenry and society, having a larger qualified worker pool seems to meet that requirement.
I think there IS a limit on how long studies go. When I changed degrees I remember one of the Centrelink mentioning something graduation date and if it's within a range—I should check. Also, they've proposed to remove the HECS-HELP discounts[1].
[1]: http://studyassist.gov.au/sites/studyassist/news/pages/chang...
"As of 1 January 2012, there is no limit to the amount of study you can undertake in a CSP. However, it is important to note that some approved providers may have academic probation procedures in place and if you are not progressing satisfactorily in your course, your enrolment may be cancelled."
[1]: http://studyassist.gov.au/sites/StudyAssist/HelpfulResources... (page 14 of the PDF file, page 7 shown in the booklet corner)
Australia needs something like HECS to encourage skills. Even with the loss of those going overseas, to support a service-based economy, it's still necessary to maintain domestic skills. The US is less in need - it is where the brain-drain of the world goes - which may be why their government feels less of the pinch.
I'll start a Master of Business Administration and Engineering in Octobre that costs a neat 104,- Euro per year.
"Poor" people still have to pay 10% (accumulated) interest on the loan (it does not matter if the interest is called 'discount') and you still leave the system with a loan of $18-30k.
If a country wants to advance technologically or academically, it should have cost-free universities like there are cost-free schools. Why do people not understand that?
I think a better solution than basically throwing fuel on the fire is to educate people about what their options are to help them make sound economic decisions, including different degree options and their value in the job market, and also about options if they choose not to go to college, since a lot of college graduates end up taking jobs they don’t need degrees for. There also needs to be a reversal in the trend of employers requiring college degrees as a form of signaling; I think evidence suggests that college admissions boards aren’t really any better at predicting student success than results from intelligence tests like the SAT. It’s going to be very politically controversial to convince people that a lot of the value associated with having a college degree is actually just in being a smart person, but I think it would make the economy hugely more efficient and save people from having to go to college just to signal their intelligence. Another big part of the solution, for those who do actually need to learn things and earn licenses, is going to be legitimizing and popularizing new forms of education made possible by technology, e.g. MOOCs, and somehow setting more efficient methods of credentialing to go with.
Have you once stopped to consider that there may not be anything close to a perfect system for lifting people out of poverty?
Perhaps a system that provides possibility that requires loads of effort to take advantage of is the best that can be done.
A country simply cannot pay for the aggregation of "necessities" that the populace dreams up.
That would be the big roadblock to implementing something like that in the US.
In the US, when evaluating whether or not to do (or continue) some program that provides aid or assistance, there are a lot of people who focus primarily on whether or not it is possible to cheat the system. It doesn't matter to them if 99 out of 100 people getting the aid are following the rules and having their lives greatly improved (and indirectly improving things for the country as a whole). It is that 1 out of 100 who gets aid who did not qualify that is all they see.
> If they earn no taxable income here, they never have to pay it back no matter how much they earn overseas. I can't really think of an easy way to resolve this because it's impossible to garnish income from another country.
This should be solvable. Change the law so that payment is owed on foreign income, even if that income is not taxable in Australia, and make it so that the Australian government can bring a civil suit for a monetary judgement against those who do not pay.
I believe (but someone should check me on this) that at least in the US, Australia could enforce that judgement. The US would recognize the Australian court's jurisdiction (assuming the defendant is still an Australian citizen), and would recognize Australia's right to tax foreign income. That, combined with whatever treaties I am almost certain the US and Australia have, should be enough for the US to consider the judgement enforceable, and to enforce it for Australia.
My recollection is that due to various treaties between most pairs of first world countries, escaping debt in one by going to another is fairly difficult, unless the debt in the first involved something that is morally frowned upon in the second. E.g., if you owed a pimp for prostitution services in some country where prostitution is legal, countries where prostitution is not legal might not recognize this even if they otherwise recognize debts from the first country.
And not only do we have HECS, but we have Youth Allowance which gives you money while you're studying, to live on.
It's similar to the case described in this article, though: if you earn over a certain amount your Youth Allowance is reduced but it's clearly stated in the rules how it works so most students get jobs at small restaurants where they get paid under the table. Works out pretty well.
Another one had to fight off fraud charges after she declared a bank account her grandmother had created in her name over a decade ago she didn't know about before. That, and she lost a huge chunk of the allowance, too.
Mine has long since been paid back (a painless process).
If you are in software, then likely you are heavily self-taught. Well, being self-taught in nearly all parts of academic engineering is easier than in practical software if only because in nearly all of academic engineering the learning materials are much, much better written.
To do self-study in academic engineering, it is crucial to get some of the best materials, usually, still, textbooks. For this, investigate and pick carefully. Indeed, you should have little trouble finding what the favorite textbooks are for what you want to learn -- likely can get enough just by going to the Web sites of the most relevant universities, departments, courses, and professors. For the engineering schools, don't be reluctant to go right to the top -- MIT, Cornell, CMU, Georgia Tech, Stanford.
If you need more, then maybe send a nice e-mail to some professors, in a few words explain your situation, maybe include a list of the candidate books you have found, and ask for suggestions, say, the textbooks he's been using, on the list or off.
Point 2. If you want an 'expensive' Bachelor's degree, say, for $50,000 a year at an Ivy League university, instead shoot for a Masters or better yet a Ph.D. from such a school. Why? In important ways, the graduate degree is faster, easier, and cheaper than the Bachelor's. In my experience, at the best schools, Ph.D. students rarely pay tuition anyway. And from the famous Ivy League schools, it's generally easier to get accepted for a Ph.D. than for a Bachelors.
Point 3: If you want a Bachelor's degree or need one (say, to get accepted for a Master's or Ph.D.), then one option is just go to about the cheapest school you can, maybe starting with just a two year community college and then transferring to a four year college to finish your Bachelor's. "Don't pay a lot for this muffler" -- uh, Bachelor's degree. Everyone in higher education understands that there are good students with little money or family background in academics and respect such students. If you learned well, then as you finish your Bachelor's you can get some high GRE scores which will look great applying to a Ph.D. program and make up for starting at a community college.
Point 4. Even following Point 3, to save money and get better results, still emphasize self-study. That is, before taking the course, study the course on your own first. Then take the course, lead the class, ace the course, amaze the professor, and get glowing recommendations, say, to a good four year college for your last two years, or from a four year college to a Ph.D. program, as the best student he ever had, maybe get a scholarship. Besides, this way might get to take extra courses at once, save tuition money, time on campus, and expenses commuting to campus and look still smarter, all because you just studied the material before you took the course.
Of course, this self-study stuff can work great for the more theoretical and mathematical parts of engineering but work less well where you might need time in an expensive lab. So, emphasize the theoretical and mathematical parts and for the rest do what you can without a lab. Then in school, when you take the lab course, you still have a head start.
E.g., on self-study, I got a Ph.D. in essentially applied math, but I never really took freshman calculus. Instead, in my freshman year the poor school I was at insisted I take some 'college algebra' which was beneath what I'd covered in four years of math at a relatively good public high school. So, not to fall behind, I got a decent calculus book and dug in. For my sophomore year, I went to a much better college and started on their sophomore calculus (right, never got course credit for freshman calculus), was likely the best student in the class, was a math major, wrote an honors paper on group representations, and got 800 on the Math knowledge GRE.
So, I covered freshman calculus well just on my own from just a calculus book. You can too. Indeed, if you take a calculus course, mostly you learn from the book anyway.
Just study the material from the book before the course instead of mostly from the book (which usually you have to do anyway) during the course. If you get hung up, then ask for some help, on-line, from some videos (if they help -- not all of them are good), knock on the door of a prof and ask a question, etc. Tell him you are studying on your own and want to be clear on, say,
f'(x) = lim (f(x + h) - f(x))/h
h --> 0
There are some poor textbooks out there, and some of the better books will still have a poor chapter or two. A bad book or chapter can be a chuckhole in the road but only if you let it. If some material seems not well written, like drilling through bedrock, or needing prerequisites you don't have, then get 1-3 alternate sources, maybe just by photocopying some chapters from some books in a library or buying some books as supplements. E.g., there is a book on linear algebra by E. Nearing, and it quite good except it has a chapter in an appendix on linear programming that is just awful. Nearing understood a lot of linear algebra but not linear programming!
So, get copies of, say, the three best books. Learn mostly from the best book and use the other two for alternate explanations (so that you won't get stuck and won't misunderstand).
Now, textbooks are darned expensive, the latest editions, in hardcover, commonly over $100 a copy. Three such books could set you back $300 -- bummer. So, instead, in nearly all undergraduate courses in engineering, get used texts, in good condition, 5-10 years old. Such books will still be plenty good and will save you a bundle of money.
E.g., I took sophomore calculus from the text by Johnson and Kiokemeister. At the time, it was also used at Harvard. It's a beautifully written, highly polished book. Tough to write a better calculus book.
So right away from a Google search at
http://www.amazon.com/Johnson-Kiokemeisters-Calculus-Analytic-Geometry/dp/020504218X
Johnson & Kiokemeister's Calculus with Analytic
Geometry [Hardcover]
6 used from $9.25
Actually I got my copy 'used' from a student who had tried the course the previous year and learned that he should major in English or some such instead! More generally, due to such circumstances, a lot of used technical books are actually in quite good condition.
You don't have to work all the exercises, but you should work enough exercises so that you are sure you can work all or nearly all of them. A good textbook will have in the back answers to half or more of the exercises; so check your work with the answers. Occasionally an answer is wrong. If you suspect such, then maybe e-mail the author! Or ask a local prof to check your solution and impress him that you beat the textbook!
Occasionally let a difficult exercise go unsolved or ask for help; in some books, 1-2% of the exercises are in there poorly written, out of place (need material not yet covered in the book or not in the book), or are to see if a student can recreate some brilliantly clever argument mostly unrelated to the book. Don't let yourself get hung up on 1-2% of the exercises afraid you missed something -- give such an exercise a good shot, then just ask for help or drop it.
Continue this theme of self study, especially if you want to go for a Ph.D. E.g., at one time the Web site of the Princeton math department just flatly stated that the graduate courses were introductions to research by world experts; no courses were given for preparation for the qualifying exams; and for the qualifying exams students were expected to prepare on their own. Indeed, in that case, why bother to be on campus in expensive Princeton, NJ?
So, broadly, you can get a Bachelor's paying little or no tuition.
Then for a Ph.D., or even some Master's degrees, the big trump card is having published some research in a good, peer-reviewed, academic journal of original research.
For how to do the research, that would need another post!
In the whole thing, nearly all the work was self-study from used textbooks, and the tuition you paid was tiny. You cut down on time and cost commuting to campus, eating campus food, etc. You aced nearly all your courses, and you avoided a huge list of potential 'political' and other problems.
Learning is not a spectator sport but an individual thing with hard work, done alone in a quiet room. You can blow a lot of time and money going to class when what you really need is just hard work, alone, in a quiet room, which, indeed, the courses won't much replace anyway.
Not everyone learns the same way. But, since you learned the material before you took the course, the profs never get to see how you learned; you never fell behind in a course; you aced courses, and you never got criticized for your learning style.
Net, lack of money is no great reason not to get a degree, even a Ph.D., in engineering. Indeed, the main challenge is just the learning and, then, research; if you can do that, mostly on your own, then money for your degree is not a biggie.
Also: how are you going to self-study when you don't live at home? Studying is a full time job.
http://www.cs.berkeley.edu/~oholtz/teaching.html
has homeworks for Rudins "Principles of Mathematical Analysis", and Halmos "Finite-Dimensional Vector Spaces". Finally most problem books (again Springer has a nice selection) have very detailed solutions. Yes, there are proofs that can be done in a number of different ways, but in my experience diverging too far is not very common and in most cases some core ingredients have to make it in in the end anyway. It's impossible to go through a lot of exercises "writing complete nonsense solutions" like that, when you are precisely checking your solutions against the given ones. For many types of exercises there are also simple ways of validating your solution, for example, in probability theory you can often do a computer simulation. In the end that's what anyway has to be done in real world and in research work.
Don't worry: I've tried to show that P = NP and know that while I've had some candidate ideas I don't have a good idea or a proof. And, I've nearly never written a bad proof; once catch on to how proofs are done, they are surprisingly easy to check for correctness.
Studying is not a full time job -- I was heavily self taught in math and totally self taught in computing and nearly never studied full time. E.g., I read Nearing on linear algebra, Halmos 'Finite Dimensional Vector Spaces', Fleming 'Functions of Several Variables', yes, with the exterior algebra, and much more while working full time in mostly DoD work around DC. I did the research for my Ph.D. dissertation in stochastic optimal control independently in my first summer in graduate school.
Edit: There's a better answer in this thread in
https://news.ycombinator.com/item?id=6177643There is plenty of free access to materials and papers.
It's incredibly cheap and fast to communicate with pretty much anyone in the world.
All that is really required is motivation, discipline, and curiosity.
When there wasn't cheap access to global communication networks and near-zero cost to duplicating data then it made sense to go to university because that was where everyone who you would be interested in talking to would be. That's where the libraries and books were. I don't think that is the only option anymore. And that's a good thing.
You can learn anything you want on your own and still have all of the benefits of a college (access to knowledgeable people, peer review, etc).
One outstanding example was his method for a 'free energy' spacecraft movement system, that hinged on an arm throwing -foo- into a receiver. The argument was that there is a difference between throwing something and merely releasing it at speed, and he didn't have the understanding of physics to realise there is no difference.
Another one of his ideas was a system for finding prime numbers, which he couldn't articulate well enough for people to figure out whether it was a valuable predictor or merely a sieve.
He was a regular at the forum and respected, and I've never seen so many people patiently explaining physics and maths at such clear lengths before... and he just couldn't grok it, because he didn't have the standard language to get his ideas across.
This anecdata doesn't contradict the GP though, who is talking about doing self-study in parallel with formal study.
Since in many cases PhD is basically free, it is by far more competitive than Bachelors.
I never got anywhere trying to get into Princeton as an undergraduate, with average SAT scores over 700, but did get accepted in the math (or statistics) department as a graduate student. I'd read lots of John Tukey's work -- uniformity in topology (in the back of Kelley's 'General Topology'), Tukey's lemma in axiomatic set theory, stepwise regression, power spectral estimation (Blackman and Tukey), the FFT (Cooley and Tukey), and 'Exploratory Data Analysis', had been working in applied math and computing, wrote G. Watson, and got accepted. I also got accepted in the Division of Applied Math at Brown and in Operations Research at Cornell. I went to Hopkins.
In many cases an Ivy League Bachelors is basically free as well.
Between tuition waivers for lower income students, and parents paying for higher income students, an Ivy League Bachelors is effectively free to most of the time.
I'm a math major and recently I started studying CS and I couldn't agree more!
That a guy started at a community college and ended up with excellent GRE scores is an impressive 'trajectory', and mostly good graduate schools will be sufficiently impressed. The graduate schools are hungry for highly motivated, good students and will want to grab what I described.
I wish I could delete the rest of this branch.
This is an area, unfortunately, where kids from wealthier families have a huge advantage. Even if your parents aren't willing to pay for college for you, they are much less likely to be hesitant to take PLUS loans on your behalf that they expect you to pay back. And as a general matter, people who came from wealthier backgrounds are much less afraid of debt and leverage.
I'm not saying that it's the most desirable state of affairs. My total cost of attendance in the early 2000's at Georgia Tech (in-state) was only $10-12k (including housing and food, tuition was just a few thousand) which I could make during the summer. But that's increasingly something that's not possible, even at state schools. And under the new paradigm, debt is the way to go. Especially with the new PAY-E repayment terms.
I'm currently a PhD student. I quit a fairly lucrative trading career in 2010 and went back to school without any intention of doing a GRA (I was fine with self-funding; to be honest, I wanted to not have a boss for a while)... that lasted one semester.
My adviser realized she liked the idea of paying 1/10 my old salary and getting an actual software engineer on her staff. I'm not one to complain or turn down money, so I took the gig and I'm near finished with the degree.
Moral of the story #1: Go back to school for a PhD with a boat load of cash in your pocket, legitimate skills and solid work experience. You won't have to pay tuition.
My wife and also decided to start a family during this time. We paid for her insurance out of pocket. Once the little guy came into the world, we started getting pamphlets in the mail from the state (aka the broke state of Illinois) regarding free programs (health insurance, food and formula vouchers) that we qualified for due to my lowly GRA salary (my wife is a stay-at-home mom). They don't care about or penalize high savings; these program managers just want to get as many qualified participants on the dole as possible to justify their existence. "Need" is not important; quotas are.
Moral of the story #2: Quit producing taxable income, go back to school, breed like a rabbit. The state will provide.
I realize this may sound harsh to those students currently getting by thanks to federal grants, but if you want to fix the problem, we need to get rid of these fucking programs. Prices will drop. All these loans accomplish is artificially inflating demand and putting graduates deep in debt. It'll be messy, sure, but the system is not sustainable in current form.
At least during the '80s, I was told I was ineligible for any financial aid.
You couldn't really have it any other way without drastically altering the structure of higher education: the alternative is that everyone's parents will "refuse" to pay and the financial aid system would be totally overwhelmed.
I am incredibly lucky and incredibly thankful that my parents value high-quality education and come from a tradition of academics who help their children through college. Some of my friends who are far smarter than me had to give up on dreams because their parents don't understand how inflation works and think you can still pay your own way through high-quality undergrad in the US.
That is, until you get to the high-end Ivies. Harvard would have cost me $12,500 over UW Madison's $24,000, but I was never going to get accepted there.
Case in point: in high school I lined up thousands of dollars in financial aid that no one else bothered to apply to. The largest check being $4,000 from my Alumni association for writing two paragraphs about how much I liked my school. A white friend of mine even got a NAACP scholarship because no one else applied (In case you don't believe this happens or think I'm joking, see [1] (not my friend). No one seemed to mind in his case).
I had some family issues and then had a falling out with my family and was locked out of FAFSA until I turned 23. Now THAT is something that does made you ineligible for pretty much any financial aid aside from traditional loans and working a lot. That really sucked. I ended up having not finishing my bachelors as a result. Thankfully Community College worked out pretty well for me.
[1] http://www.huffingtonpost.com/2012/06/12/jeffrey-warren-whit...
True, the debt seems a lot smaller in that context. I'm (very slightly) optimistic that the new rules which cap student loan payments as a % of income and also subsidize public service work will make this burden a little lighter and less intimidating.
But at bottom, it's still a terrible problem. Not everyone is a financial wizard, and after an unpleasant brush with debt as a youth I've been largely allergic to it since. It's disappointing that people who want to take a fiscally conservative approach and pay up front or as they go are finding that becoming ever more impractical, thereby limiting their economic opportunity and productivity. Although many schools offer scholarships and suchlike, they're far from transparent.
I did not go to school for CompSci, btw, or anything programming-related (unless you count programming synthesizers as "programming" :P)
If that is the case, why is Ingrid saying that she cannot?
"All of my debt is government loans, but this time around I don’t even have the option to take those out."
While this wouldn't work for many fields, it would certainly help in cases like this (and tech in general). It would seem that with as much as companies pay for head-hunters and recruiters (and how much they whine about the lack of quality candidates), it would be a no-brainier.
Its just a contract. Mutually agreed upon. I'm sure it can be structured so that the student/employee can exit the contract with a reasonable repayment plan.
Are current student loans, non-dischargeable through bankruptcy really that much better?
Without a ridiculously good merit-based scholarship from a great school, I never would have been able to attend any of the top-tier schools into which I had been accepted, because my parents' money was counted as my money, even though their money was clearly not mine, and not something that I could choose to spend.
It's a flawed system, but simply not counting your parents money is an even more flawed system.
This doesn't just affect the individual, it affects all of us who are trying to hire good engineers. The smaller the number of people that are allowed to attempt an engineering degree, the fewer that will earn them. Every single potential engineer that is prevented from entering the field because of education hinders us.
Trying to bring this back to HN a bit more, I think that entrepreneurs and capitalists should realize (and you may already be on the same page with me) that they are in essence farming society; they are leveraging and multiplying the work and efforts of many others in order to enrich their own wealth and the wealth of others. The more fertile the soil, the more the entrepreneur can grow. For technology based capitalists, a more educated society provides far more fertile soil both in terms of workforce and potential customer base.
I couldn't see that being possible with today's college costs.
In contrast, an electrical engineering degree will easily pay for itself, particularly if you've managed to bootstrap yourself to a third year.
Why haven't you addressed student loans as a vector for finishing a highly lucrative degree program? Seems like you are (forgive the term) a poster child for student loans.
In the early 2000s a degree in chemistry was considered a safe bet, especially with a biochemistry PhD tacked on. Then there was the 2008 recession, the great round of layoffs at the major pharmcos, combined with the offshoring of early discovery. If anyone says they feel cheated I'm not going to disagree. I'm not going to use the word "rube", and neither should you!
At the moment medical school is what the kids at my university are shooting for, that used to be the ticket into a safe career, but one thing is clear: healthcare in this country is in need of reform. I cannot say how it is going to look, but I will not say that taking out five-digit loans for medical school is a good idea.
And who can tell about EE? If they offshored chemistry they will offshore design. It's going to happen, the pharmaceutical industry has provided the blueprint.
It includes projected number of new jobs this decade and projected growth rate per career.
http://studentaid.ed.gov/types/loans/subsidized-unsubsidized...
That's not enough for many state schools, and definitely not enough for private schools:
http://grad-schools.usnews.rankingsandreviews.com/best-gradu...
The only way to get private loans is to have a creditworthy cosigner. Otherwise, you need parents to take out Parent PLUS loans to cover the remainder.
I assume the person here was paying for tuition with a combination of school-provided need-based grants and Stafford loans. Now that the need-based aid has been cut because her Expected Family Contribution has gone up due to her paid internship, she can no longer get enough money to pay the full tuition.
It may be too late to apply and get such things but I didn't read of any effort to track those down. Finding scholarships, even qty 10 of $500 apiece requiring 3 hours' work each, should be easier with this backstory than any other I've ever read.
After I graduate came to the US and I've been living in a typical college town at the east coast for ~7 years. I have many undergrad and graduate friends most of which are American. I'm _BAFFLED_ at the simple acceptance of this rip-off fucked up higher education system. It's not even a topic ever that our local University President just raised tuition by another 5% this year. And a ~40% raise in the last couple year. In Germany, they started talking about introducing a 500 Euro tuition in 2006(?) and introduced it in 2007. Students where furious, they protested on the streets, they occupied the main buildings. They raised there voices. They started petitions. The press was on our side. They introduced them and students investigated on how the tuition was going to be used (contract only allowed to use it towards better education and not for maintenance/bills) and problems were discovered. Long story short: In 2013/2014 there is only one state left that still has a tuition of 500 Euros. The rest abandoned it all.
I have asked this question many times:
Why do Americans not protest?
Take the French: they kidnapped their CEO and threatened to kill them (~2009). They burned down parts of their factory. They raise their voice. Yet, with a ridiculous policy here in the US, I see nothing ever happen. I heard there was some protest about PRISM in S.F. last week. I frankly missed the coverage about that since it may have been to small. There were bigger protests about PRISM in Germany last week. This is sad and I don't understand it.
Students of America: Stop wining on Internet forum, they do not tend to often get coverage of the media.
You want main stream TV coverage: Go on the streets and protest.
UC Student Protests http://www.google.com/#bav=on.2,or.r_qf.&fp=7608e52397923e7c...
Cooper Union Protests http://www.google.com/#bav=on.2,or.r_qf.&fp=7608e52397923e7c...
CUNY Protests http://www.google.com/#bav=on.2,or.r_qf.&fp=7608e52397923e7c...
Rutgers Protests http://www.google.com/webhp?hl=en&tab=ww#bav=on.2,or.r_qf.&f...
There are real expenses associated with running a university. Professors and staff have to be paid; buildings have to be maintained; supplies have to be purchased, etc.
We will all still pay for it, just with higher taxes for everyone all the time, not just students while they are in school. That kind of reform will never happen in the US, because we are afraid of it. We are afraid of the dreaded socialism, even though our primary education is free and socialized, also incredible uneven because it is funded by local property taxes.
Votes to reform health care resulted in death threats to law makers and bricks thrown in their windows. http://www.pressherald.com/news/nationworld/vote-unleashes-t...
America is fairly democratic. We do not have plans, we have slogans that appeal to the dumbest 51% of the population. The problem is emotion-driven electioneering, and mass protests would only make it worse.
But Sallie Mae would have you think otherwise when their split goes through on wall st. I have a feeling someone is going to get rich off of CDS backed by securities on student loans… as for the rest of us, I guess we have to create new paths in life to acquire and apply knowledge for the betterment of our communities that we are apart of because going x times more in debt than the generation before, to acquire knowledge to apply in a world that is increasingly making it obsolete (as far as human labor is concerned in a service dominated economy) seems like an exercise in futility and fiscal suicide.
Seriously, I would welcome any speculative economic analysis here.
Harvard and MIT will be fine, but the schools that aren't worth $60K/year, or less for e.g. higher tier state schools other than UC Berkeley, are likely to see enrollment crashing. That's starting to happen with law schools.
-Sallie Mae (SM) completes its corporate split (Fed loans in one company, Private in the other) [1]
-People buy shares of SM, and get paid dividends every quarter (or w/e their terms are).
-As of today, 40% of Federal loans payments are being made, with $118+ billion Fed loans in their portfolio of $1+ Trillion outstanding Fed loans (so SM is probably the most statistically correlated to the total compared to others individual companies) [1][2]
-As interest rates go up on loans [3], and cost of tuition goes up [4], less people will afford to make payments (regardless of if they are in school, dropped out, or un/employed)
-As less people can afford to make payments, the current 40% making payments will go down (as it has untill this point under the current circumstances).
-Less people making payments means less money to go around to pay dividends
-lower dividends on shares means people try to sell shares.
-In attempts to raise capital to pay dividends (and stabilize share value), SM will accept cash/credit in exchange of secured student loans (delaying the issue of not being able to pay dividends due to market forces in response to status quo policies)
-If/When x amount of the secured loans become non performing, SM has to pay in full for the amount disclosed in the CDS deal.
Rinse, wash, repeat…
[0] http://www.americanbanker.com/issues/177_63/us-bank-student-...
[1] http://www.bloomberg.com/news/2013-05-31/sallie-mae-split-ma...
[2] http://www.cbsnews.com/8301-201_162-57597232/study-half-of-$...
[3] http://www.reuters.com/article/2013/07/31/us-usa-studentloan...
[4] http://money.cnn.com/2012/10/24/pf/college/public-college-tu...
It sounds like between the two internships combined they'd have made around $30k total, no?
If so, that seems like just barely enough to cover living expenses and a year at a public university with $4 to $7k in tuition and fees a semester.
Though it would be lame to have to spend 9 months off school to spend a year in school.
It is seriously not realistic that everyone go to public school. Also, public school funding is being cut, and students are being asked to pay bigger part of the tuition. Also, public school prices vary a lot by state.
Private universities might have a bigger sticker price, but there's more room for leeway. There's need based grants that can be given out by the school itself, for example (I got them from mine). I don't know if public schools can do this.
Students should be warned that crossing the highway blindfolded if unsafe.
Students should be warned that the stove could be hot if you leave it on.
At some point, people need to take personal responsibility for their action. They need to understand how their actions effect them positively or negatively and balance out those decisions. People need to understand that there is nobody that is going to hand hold them through life.
It's counter intuitive. It's not obvious at all. It's barely mentioned or talked about. It can cost (and it did cost her) a college degree.
I don't disagree with the sentiment of your remark, but it's completely out of place here. She's simply warning others not to do the same mistake, since it's an easy one to make.
The fact that earning money in college could negatively impact your ability to pay for college is not obvious.
The warning is justified. Many people would not anticipate this.
I tried saving up enough to even just move away. 3 years later, and not a penny ahead, I just threw caution to the wind and plunged myself deep into debt to get the hell out of there.
A year later, I've made more than I did in those 3 years put together. I'm still in debt, but I'll comfortably be out in 6-8 months. At this point, university would only be of value to me if I felt like immigrating to the US.
The point is, if your situation sucks, change it. If school doesn't seem viable, skip it. Find a workaround. The point is not acquire a piece of paper, the point is to prove your worth.
Adversity is a force that not only pushes us back when we feel fear, but also pushes us forward when we feel determination. How much you want a thing will determine which way you move.
After a year of work wherein I made about $25k, I talked to the financial aid office and found out that my expected contribution towards tuition, room, and board was likely to go from about $5k/year (barely covered via loans and family support) to $15-20k, which was totally untenable.
My response was to drop out, keep coding, and figure out how to backfill the CS knowledge I needed by working with smarter, more experienced people than myself. 15 years in, it seems to have worked reasonably well, and I'm regularly reminded how much easier my life has been not having tens of thousands of dollars worth of student loan debt hanging around my neck throughout my 20s.
To be clear: I know that the plural of anecdote is not "data", and I don't want to suggest that the dropout -> tech industry path is easy or in any way guaranteed. However, I think that it's a far easier field to get into than many others if you have the aptitude and motivation to build some things on your own and learn as much as you can from the process.
Average graduating debt was ~$23k last year. http://www.finaid.org/loans/
I also wasn't really trying to generalize; I was attending a fairly expensive liberal arts school (albeit to study math) with 100% need-based financial aid, and tuition alone doesn't cost nearly as much at most state schools.
It would be worth probing the internship company in this case to see if some similar arrangement could be made. (if the budget for tuition vs part/full time pay works out, I did this in the 90's, no idea how it would work now).
Today, the gap is undeniably tighter between college expenses vs living wages at available jobs. If you're sending yourself through college, working or with a loan or some mix, it seems like a career ROI calc and a budget/cashflow calc for during college is in order. You also might have some hard choices in deciding not to pay a premium for prestige, and look for a solid education at a discount at a less prestigious, but still perfectly functional college.
[1] http://www.calstate.edu/budget/student-fees/fee-rates/Tuitio...
Lets assume that your taxable income was 27k.(36 weeks x 40 hours a week x $26 an hour)
You will be in the 15% tax bracket, so the total tax liability on your income would be approximately(i'm assuming only federal income tax) 23k (27000*.85). This is the number that is used on the fasfa. You had mentioned that you suffered from some health issues and incurred medical expenses. Those are deductible, and should reduce your tax bill, as well as the amount of money that colleges should expect for you to spend on education.
Furthermore college 529 plans are something to look at when trying to fund college education. Contributions to these plans are tax free, so it will lessen your tax bill, especially if you don't work while you are in school. Also the 529's in your name are expected to go towards your education at the same rate as your parents income[1] this will help soften the blow of losing the financial aid.
Finally, don't shy away from student loans, especially subsidized federal loans. At around 4%, it is hard to find cheaper money, and wih subsidized loans, the interest on these loans are tax deductible.
At the end of the day, the moral of your story shouldn't be "Don't take paid internships they'll screw you in the end" and instead it should be "when you start get paid a significant salary hire a tax professional to make sure I hold on to as much of my moolah as possible."
You can put up to 5k in a Traditional IRA. Your deposits will be tax deductible, and withdraws for education forgo penalties of withdrawing money before your 59 and 1/2. You will also pay for tax on it at the level of income for the year you take the disbursements, so if you don't work your senior year or make less money it could work out to your favor. The downside of this strategy is that any money you put into the IRA that year will be counted as income. So no gaming the system on this one.
[1]http://www.savingforcollege.com/intro_to_529s/does-a-529-pla...
"Beginning Jan. 1, 2013, you can claim deductions for medical expenses not covered by your health insurance that exceed 10 percent of your adjusted gross income."
Previously it was 7.5%, but it's nothing if you can't file a Schedule A to itemize, and my very rough understanding is that few who aren't paying down a mortgage can do so.
I could be entirely wrong about this. I am not a tax professional, but I do think that a little bit of financial planning could go a long way in these types of situatons.
Although, yes, it's immensely frustrating that they take whatever money they can. I spent all the money I saved up from high school right before college so they couldn't take it away.
Now, of course, one wonder's why we are offering loans and aid to people who can't get such a return on investment ( regardless of whether they need to pay or not).
Or a job of any kind. Same thing happened to me.
The idea here is to capture attention (short, punchy letter), provide all the ammunition a staffer needs to make a phone call asking what the hell is going on (the attachments), and the targeting information.
Send 'em hard copy, to both the DC and the local district office. Wait two days, send an email. Wait a day and call, asking to speak with someone in reference to same. You won't get the Congressman, of course, but if you get a competent staffer they'll know how to look into the matter and make people uncomfortable enough to do better. Get someone who's worked in the district a few years and they probably play tennis with someone at the University.
These offices are heavily dedicated to constituent service. If you get their attention and make it easy for them to investigate, some staffer will pick this as a lay-up "good deed for the day."
Congress doesn't have jurisdiction, of course, but any public institution steps to when the office calls. They'll pay attention, and they may very well look harder for some discretion to fix this.
The overall system is, of course, stupid. That won't get any better, it's a set of compromises among reasonable sounding concerns that have amounted to a Kafka-esque impossibility. But there is a lot of discretion in the joints -- if you can make someone notice this particular glitch, it might get fixed.
The system is set up in a way that OP (and I am sure many others) found herself in this strange valley, where you are damned if you do, damned if you don't.
If this isn't too intrusive - how much were you making when you received $16k in financial aid vs. $104? Are you only including grants in this amount, or does this also include low-interest student loans?
When I was in school, that was a red flag. Without knowing the details of Ingrid's education costs and spending habits, it's just as easy to conclude that Ingrid lived beyond her means.
Thus, before blaming the system, I'd want to know what Ingrid's numbers were. She did intern for Intel, which pays very well and provides lots of assistance.
However not all programs will be free if you come from outside the EU.
It sounds like the author is now extremely well-positioned to get reasonably good jobs and really start her career. Doing so and continuing her formal education part-time may be the best choice.
That is why Financial Aid Advisers (the ones at your school) can make judgement calls on a case by case basis to override the computer system.
Specifically, there are two qualities of your described situation which qualify you for such an override. 1. You mentioned that you are couch surfing with friends. This means you are homeless 2. You made a good amount on previous employment and your story seems to suggest that said employment is no longer active. This means you have recently lost your job. According to FAFSA guides for financial aid advisers, professional judgement may be used to adjust parameters which are used to calculate your expected family contribution.
Your situation appears to apply to several typical cases in which professional judgement is recommended.
1. "A student is considered homeless if he or she lacks fixed, regular, and adequate housing. This includes students who are living in shelters, motels, cars, or parks, or who are temporarily living with other people because they have nowhere else to go." -https://fafsa.ed.gov/fotw1314/help/fahelp29a.htm
2. "Special circumstances may include tuition expenses at an elementary or secondary school, medical, dental, or nursing home expenses not covered by insurance, unusually high child care or dependent care costs, recent unemployment of a family member or an independent student, a student or family member who is a dislocated worker (as defined in section 101 of the Workforce Investment Act of 1998), the number of parents enrolled at least half time in a degree, certificate, or other program leading to a recognized educational credential at an institution with a program participation agreement under section 487, a change in housing status that results in an individual being homeless (as defined in section 103 of the McKinney-Vento Homeless Assistance Act), or other changes in a family’s income, a family’s assets or a student’s status. Special circumstances shall be conditions that differentiate an individual student from a class of students rather than conditions that exist across a class of students. Adequate documentation for such adjustments shall substantiate such special circumstances of individual students." -http://ifap.ed.gov/fsahandbook/attachments/1314AVGCh5.pdf -http://www2.ed.gov/policy/highered/leg/hea98/sec478.html
All of this amounts to the your case calling for professional judgement by your financial aid advisers. I do not know what made them turn you away before but it may be as simple as not knowing. I had a similar situation in school myself, it turned out that the first adviser I worked with was somewhat new to their job and just did not know they could make a judgement call.
Never give up. If it seems like the system is broken, make it work for you. I hope this information helps.
For anyone else who happens to know Ingrid Avendano or how to get her a message, please pass this info along.
Merit scholarships exist for the latter.
Well... Stanford won't disperse financial aid if you have a balance of over $1k. So, I had 2 days before school started and I didn't have the money to head back to school. No matter who I talked to or who I called, the story was the same. That $1k was my responsibility but to be honest, I didn't have it. That summer I barely made enough to support myself. I also maxed out my credit cards and because of my family situation, I didn't have a cosigner that could help me co-sign a private loan. I also couldn't apply for a loan through my school because that was also considered financial aid. That night I cried... so much. I called my financial aid office over and over only for them to tell me the same thing. I called relatives. I even begged my brother for a small loan just so I could register for classes (which he never gave btw). The next day at work I burst into tears for seemingly no reason at all. Why should I? I go to a school with all the bells and whistles. Why would that be a concern? Had a sorority sister not heard me crying, I would never have gotten the money to enroll.
It's because the system is broken. This story is not about amounts or what she "could've done," it's about the reality of being in a situation you can't possibly control.
For example, the Stafford loan program offers unsubsidized loans (meaning interest accrues while you are in school) to all eligible students regardless of need. The eligibility requirements for these loans amount to being legally allowed to attend school in the US and not being in default on existing student loans.
As an independent student, you should be able to borrow up to $12,500 in unsubsidized loans directly from the government, regardless of your EFC. It will be more expensive than your other loans in the long term, so you should weigh the cost of two years of additional interest against not finishing school.
All of that said...
Something really feels wrong about your financial situation. The automatic-zero Expected Family Contribution limit for an independent student is $24,000. Assuming you were living on student aid from January to May and made $25.85/hour, 40 hours a week from June to December, for a full 30 weeks (unlikely given holidays, etc), you should have made right around $31,000 pre-tax. If that's the case, your EFC should be a _maximum_ of $7,000, but probably closer to half that.
My bet: your FAFSA EFC is incorrect. Find the worksheets and manually work it out for yourself.
Why not just take out loans and go to a state school? I went to a good engineering state school in New York and many of my classmates got excellent jobs after that. The tuition is only $5k per year. Total tuition and other expenses can be easily paid off within a couple of years with an engineering job. The interest rate is only like 5% for people with OK credit.
Regarding credit cards: It definitely does not make sense to use credit cards to pay for tuition, because the APR is very high compared to student loans.
Edit: Regarding the amount you can take out in private loans: Discover lets you take out like 50k per semeseter. This is way more than enough.
I also did a paid internship, for $18 an hour at a major software company in Vancouver, B.C. Now the Canadian government has decided that I have more than enough (assuming a cost of living of 0 for a 20 year old that has to support an elderly mother).
So basically, I have an income of 0 (aside from my freelance work), costs running at ~$1600 CAN per month for basic shelter + food for 2 people, AND the Canadian government is constantly on my back for student loan repayment. I did not choose to dropout of college, I was (essentially) forced to by the government.
Best part is, now any employer I talk to asks about the 1 year I spent in college. I'm sure they assume that as a 20 year old, I am either lazy, stupid, or irresponsible. But that couldn't be further from the truth. I've worked 18~22 hour days everyday of my life since I was 16, and I'm tired. Not tired of a (somewhat) difficult life, but tired of the assumptions people make. People in the government, people who have power of employment, people around me who judge a book by its cover.
(Disclaimer: I go to a need-blind school with very good financial aid. I don't know how engineering/state schools will treat this. But it's worth TALKING to them.)
I remember some of my friends saying they received more in grants and bursaries than what I made in that 4 month period alone (with no effort, to boot!), and that slightly discouraged me a bit, but one needs to remember this is an investment that will pay off in the next few years.
That being said, I was enrolled in a software engineering program, but most of my friends have found work in EE as well.
I ended up just paying for school out of savings (I had worked 4 years before my junior year). Another thing about savings is that they expected I could spend 100% of my savings immediately. They don't even pro rate savings across the multiple years required for a degree. Financial aid is for them, not for the student.
This effectively means almost everyone who gets loans for their education pays full taxes on the money they used on that education. But if you have well-to-do parents pay for your education, they get to write the expenses off and pay much less in taxes during your college years.
It's a situation where wealthier people get a significant discount just for being wealthy, and there's really no social benefit to having it be this way.
That being said, I think it really is horrifying that our education system rewards those students who stay behind and attend summer school more than those who secure good internships. I've never met a talented developer or engineer who didn't have at least 2 summer internships in undergrad. I have, however, met a ton of shitty engineers who took plenty of summer classes.
And really, I am not sure how you couldn't get that any taxable income would cut into what you get. I was a drunk stoner and knew it. During the summers I got a real job and knew to never make over $9,500 in taxable income or it would eat into my aid. I quit jobs before school started so I wouldn't hit that number.
The purpose of the student loan system to help extend credit to people who are otherwise less creditworthy. It's not a perfect system but it sorta works. In your case, you said you maxed out your credit cards. Presumably you managed your credit effectively aside from that, and then paid it off. If so, your Fico score should be high enough to qualify for a loan outside the federal student loan guarantee program.
It's going to be hard to change things because every little rule has people making a living a living of it.
And by "similar" I mean that I may have to drop out because I cannot afford it. Loans from the government are not enough. Can't get private loans. Can't get money from the parents.
Does a late FAFSA impact Stafford loans at all? I'm fairly certain I still made the deadline, but by no means was I an early submission.
The French scientific higher-education system is weird and misunderstood even in other European countries, so here's a (very simplified) explanation of the road I followed and how much it cost.
After high school, if you have good enough grades (say top 10%) you can enter something called Classes Préparatoires, which is a rather intense scientific (Math + Physics) preparation for competitive exams for the Grandes Écoles. It lasts two years, three if you decide to repeat the second year because you are not satisfied with your results at the exams (repeating the first year is forbidden, if your fail you have to go to a regular University - which is also cheap anyway -, but only 10-20% fail the 1st year).
There is a lot to say about how the way we are taught in Classes Préparatoires should change, but there is something right about them: they are completely free. Oh, and if you (your family) cannot afford rent and/or food, you can get funding from the government for this.
After Classes Préparatoires, if you succeed at the competitive exams, you get into a "Grande École" (Engineering School). Studies usually last three or four years and you get a Diplôme d'Ingénieur at the end (basically what you call MSc in the US).
All the top Grandes Écoles are public and depend on different ministries (Education, Industry or Defense). The cost of studying there is below €1000/year. You can still be subsidized if needed, and you are encouraged (actually it is even mandatory) to make paid internships which pay for your studies. Actually, the two top Engineering Schools (Polytechnique and École Nationale Supérieure) even pay students who study there.
Oh, and you are encouraged to go abroad. You can do an internship in another country or go there to specialize during your 3rd year. In my case I went to a British University to specialize in Distributed Computing. The cost of studying there is much higher but since I was a guest student from another European University I didn't pay (except campus rent). It also works with the US, although I am not sure how: some friends did the same thing at Standford and MIT.
In the end, I got two MSc-s (one in France and one in UK), and my tuition fees for the entire thing amount to about €3000.
There are very few things I think a State should pay for, but top higher education is definitely one of them.
"That summer I started my first engineering internship for six months from June to December, making $25.85 an hour working for a well-known tech company.",
"It made no sense for me to stay in school; the financial stress was affecting my ability to get work done, and subsequently my GPA dropped.",
"This June, I was notified that my financial aid was reduced from $16,000 to $104 because I had made too much money in 2012, which put me in a higher income bracket to receive less financial aid.",
"Every attempt to contact my financial aid office has been unhelpful.",
"They have parents that pay for school and all their expenses, which makes their internship money pocket money."So the fuck what. They just did you a favor.