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(Boing Boing)   A family with a million dollar house earning $200,000 a year but with no savings will get more student aid than someone with a modest house earning $50,000 a year and $200,000 in savings   (boingboing.net) divider line 277
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10584 clicks; posted to Main » on 14 May 2013 at 11:11 AM (48 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-05-14 09:27:00 AM
I guess it's possible to sock away $200K on a 50K salary, but that's some serious Dave Ramsey devotion they've got going there.
 
2013-05-14 09:27:37 AM
A family with a million dollar house earning $200,000 a year is most likely horrifically in debt, or if not, a layoff or health problem not covered by insurance away.

/just saying
 
2013-05-14 09:28:41 AM
Only the wealthy should receive an education. That's just common sense, yo.
 
2013-05-14 09:29:44 AM
Well yeah, use your savings.  What else are you saving it for?
 
2013-05-14 09:33:15 AM
www.newyorker.com

"Take a shot, go for it. Take a risk. Get the education. Borrow money if you have to from your parents"
 
2013-05-14 09:44:23 AM
I like Senator Warren's plan of allowing students to borrow at the same rate as banks.
 
2013-05-14 09:45:10 AM
Read the full article. The author seems to take offense to any form of academic scholarship that goes to well-off students.
 
2013-05-14 09:49:32 AM
Answer: What is "The Government supports programs that encourage the production of viable taxpayers". The student saving money?  She/he  isn't stuck in a perpetual circle of debt and certainly isn't generating as much sales tax required to keep the government Ponzi schemes going.
 
2013-05-14 09:57:56 AM

ThatGuyGreg: A family with a million dollar house earning $200,000 a year is most likely horrifically in debt, or if not, a layoff or health problem not covered by insurance away.

/just saying


Of course if they inherited the house, they're in a pretty nice spot.
 
2013-05-14 10:05:07 AM
Second family is wealthier.
 
2013-05-14 10:31:06 AM

ThatGuyGreg: A family with a million dollar house earning $200,000 a year is most likely horrifically in debt, or if not, a layoff or health problem not covered by insurance away already in bankruptcy court.

/just saying


Assuming the house is carrying a mortgage, of course.
 
2013-05-14 10:58:30 AM
No they won't. I don't have time for this shiat today, because my actual students have sent me actual FAFSAs to review and I've been out of the country for a week, but take it from me: I've been doing this for a decade.

FEDERAL AID DOES NOT WORK THAT WAY.
 
2013-05-14 11:14:47 AM
Never understood why people think student aid should only be for the poor. People that make money then have to pay for their kids, as well as poor people's kids. And God forbid you go back to school as an adult when you have a good job.
 
2013-05-14 11:16:09 AM
Earn $50K a year and have $200K in savings?  No one in this planet is that good with money. My girlfriend heard someone call into the Dave Ramsey show who earned $8,000 a month, married with one kid, who had over $42,000 in credit card debt alone. Plus the wife, who earned her own income, had credit card debt of her own.   Most people are idiots when it comes to budgeting.
 
kab
2013-05-14 11:16:26 AM
And the best interest rates are reserved for the folks who need them the least.

Capitalism, working as intended.
 
2013-05-14 11:16:57 AM

ArkAngel: Read the full article.

Yeah right.

 
2013-05-14 11:17:42 AM
I make $50,000 and have no savings, so I guess my kids are set.
 
2013-05-14 11:18:27 AM
I'm still bitter about having my aid be tied to my parents income, despite them not actually paying for my tuition.  I actually lost all aid my sr year because they sold a failed business and made money on the books, despite all that money going to medical bills.
 
2013-05-14 11:18:30 AM
And a person with a Hispanic last name will get twice as much financial aid as one with a "white" sounding name, even though the Hispanic family makes nearly three times as much as the non-Hispanic one...

/why yes, I do have personal experience with this, why do you ask
 
2013-05-14 11:18:42 AM
In other words, low-income families are routinely being asked to fork over more than half of their annual income for the privilege of sending their child off to campus for a year.

They wouldn't be asked that if they looked at affordable state or community colleges instead of over-priced private schools.
 
2013-05-14 11:19:05 AM

kab: And the best interest rates are reserved for the folks who need them the least.

Capitalism, working as intended.


Because the bank is losing money on your basic checking account that you draw down to 6 bucks every 2 weeks before payday.
 
2013-05-14 11:21:20 AM

DubyaHater: Earn $50K a year and have $200K in savings?  No one in this planet is that good with money


Gulper Eel: I guess it's possible to sock away $200K on a 50K salary, but that's some serious Dave Ramsey devotion they've got going there.


Parents (and random uncles) die all the time.  It's entirely possible.
 
2013-05-14 11:21:35 AM
A year after graduation, all those business majors will realize that they could have got their job as a teller with Wells Fargo with a high school diploma. Thirty grand well spent.
 
kab
2013-05-14 11:22:00 AM

LineNoise: Because the bank is losing money on your basic checking account that you draw down to 6 bucks every 2 weeks before payday.


And raking in truckloads by charging 18%+ compound interest to folks who carry long term credit card debt.

Those poor, poor banks.  Perhaps another bailout is in order.
 
2013-05-14 11:22:27 AM
Just be a minority. The government will make rain for you.
 
2013-05-14 11:22:31 AM

DubyaHater: Earn $50K a year and have $200K in savings?  No one in this planet is that good with money. My girlfriend heard someone call into the Dave Ramsey show who earned $8,000 a month, married with one kid, who had over $42,000 in credit card debt alone. Plus the wife, who earned her own income, had credit card debt of her own.   Most people are idiots when it comes to budgeting.


I'm 38, and while $50K is not my salary range, I do have about 4 times my salary in savings (including non-retirement investment accounts, as I assume that's what FAFSA looks at).  Granted, I've been lucky in a lot of ways, and I wouldn't be there if I'd had kids when I was in my 20s.

/ Or drank like a Farker.
 
2013-05-14 11:22:42 AM
Gummint
 
2013-05-14 11:25:52 AM

brap: I like Senator Warren's plan of allowing students to borrow at the same rate as banks.


Stupid idea is stupid. The problem with the system as it currently stands is too much free money and too little competition. You want to fix the college tuition problem then go on a Federal University spending spree, Federally mandate that tuition start at 5,000 dollars a year and only rise at the rate of inflation.
 
2013-05-14 11:26:00 AM

what_now: No they won't. I don't have time for this shiat today, because my actual students have sent me actual FAFSAs to review and I've been out of the country for a week, but take it from me: I've been doing this for a decade.

FEDERAL AID DOES NOT WORK THAT WAY.


The article was about Private Colleges endowment grants not federal aid.
 
2013-05-14 11:27:00 AM

kab: LineNoise: Because the bank is losing money on your basic checking account that you draw down to 6 bucks every 2 weeks before payday.

And raking in truckloads by charging 18%+ compound interest to folks who carry long term credit card debt.

Those poor, poor banks.  Perhaps another bailout is in order.


What should they charge for loaning you money with no collateral?

Also if you don't have shiat credit, you can do far better than 18%
 
2013-05-14 11:27:43 AM
Have safe-deposit boxes ceased to exist?

FAFSA only considers documented savings.
 
2013-05-14 11:28:07 AM

what_now: No they won't. I don't have time for this shiat today, because my actual students have sent me actual FAFSAs to review and I've been out of the country for a week, but take it from me: I've been doing this for a decade.

FEDERAL AID DOES NOT WORK THAT WAY.


I am sorry; you have actual real-world expertise and knowledge in this field. You do not belong here.

Your comments will be ignored, or random Farkers will contradict you with no references or sporadic references to unreliable sources.

There is really no point in your posting to this Fark thread. Sorry.
 
2013-05-14 11:28:20 AM

Lawnchair: DubyaHater: Earn $50K a year and have $200K in savings? No one in this planet is that good with money

Gulper Eel: I guess it's possible to sock away $200K on a 50K salary, but that's some serious Dave Ramsey devotion they've got going there.

Parents (and random uncles) die all the time. It's entirely possible.


TFA says $200K in savings, not $200K in inheritances.
 
2013-05-14 11:28:20 AM
I wish my house earned $200,000 a year. Heck, I'm not greedy. $20,000 would be plenty.
 
2013-05-14 11:31:33 AM
Considering student loan debt CAN'T be shed in bankruptcy, there is no reason borrowers shouldn't be offered the same rate as the banks themselves.

As for the article, I agree with subbie's use of the obvious tag - everyone knows the rich have more privilege and opportunity than the poor.
 
2013-05-14 11:32:07 AM
$200k in savings is a lot of money, not sure what the issue is that the government might expect you to spend it before they start giving you money for college.  That's the way things have always worked.  When I went to school, my parents, who don't earn a lot, had some modest savings thanks to my grandmother, who had passed away a year earlier.  You know what they did?  Built a 2-car garage for their house with it.  Increased the property value and I got more loan money for college.  Win-win.
 
2013-05-14 11:36:02 AM

TheEndIsNigh: I'm 38, and while $50K is not my salary range, I do have about 4 times my salary in savings


If your HHI is $100k and you live on $50k, you're a skinflint but nobody bats an eye.

If your HHI is $40k and you live on $20k (and kids are involved), you're running on the edge of a visit from social workers.  Sure, there are kids in families with $20k incomes, but they are also qualifying for free lunches, food stamps, school-fee waivers, etc, that you don't qualify for as a hyper-frugal moderate-income person.

tldr: Fixed costs are fixed

TheEndIsNigh: (including non-retirement investment accounts, as I assume that's what FAFSA looks at)


FAFSA indeed only looks at non-retirement accounts.  This is one of the real reasons to tie up as much as you can in IRAs/401k/HSAs.    The tax benefits are really minor if you're in the boring end of the tax brackets.  You pay taxes now or later... and dividends/capital-gains are already at 0% for most average earners... all pretty much meh.  But, a bankruptcy court will typically not touch your retirement accounts and it's not real money for FAFSA consideration.  Those are major advantages.
 
2013-05-14 11:36:03 AM
Yeah, I really don't believe the claim in TFH, and don't see it directly in TFA. Savings is definitely a big consideration in financial need, but income seems to be even bigger. I tried some moderate shenanigans to improve my FAFSA, but still got nothing better than offers for unsubsidized loans. So I kind of dread going through that for kid #2, it was pretty tedious and our savings have increased pretty well since the first.
 
2013-05-14 11:36:13 AM

God Is My Co-Pirate: ThatGuyGreg: A family with a million dollar house earning $200,000 a year is most likely horrifically in debt, or if not, a layoff or health problem not covered by insurance away.

/just saying

Of course if they inherited the house, they're in a pretty nice spot.


Not if you include property taxes in such places like New England. The taxes on a house like that can be around 25k. That's a hefty chunk of that otherwise "excellent" income.
 
2013-05-14 11:37:37 AM
Wait kids can actually get IN to a 4 year college with a SAT score under 700???
 
2013-05-14 11:38:05 AM

ArkAngel: Read the full article. The author seems to take offense to any form of academic scholarship that goes to well-off students.


Well you might have read it, but you didn't comprehend it.

FTAThere's nothing inherently wrong with handing out tuition breaks to the middle class, or even the rich. The problem is that it seems to be happening at the expense of the poor.

The point, you missed it.
 
2013-05-14 11:38:10 AM
.... a million dollar house is a pretty regular (or even small-ish) house in most of the country, Subby. And a family of four living on a $200,000 is not any means rich.
 
2013-05-14 11:38:47 AM

Gulper Eel: I guess it's possible to sock away $200K on a 50K salary, but that's some serious Dave Ramsey devotion they've got going there.


I've saved more than that on about 60-70K here in Montreal. Cheap apartment well below my means (and lease from 1999, with state controlled increases), t-shirts, no car, no kids. Also, all the money I save I put into retirement savings which are tax deductible. Then I get a nice return at tax time, which I put back into retirement savings.

And I still spend without thinking because I figured it all out years ago. Oh, look, a 2000$ quadcopter? No problem. Food's not on special? Buy it anyways.

Oh, and a house is not an investment.
 
2013-05-14 11:39:58 AM
That $200k is savings, not retirement. Retirement investments are not required to be disclosed when applying for financial aid while income history and 'cash on hand' is. Aid is provided based upon need, and if you have $200k in the bank, not counting retirement, you have little need. I would also think that $200k in annual earnings (but no savings) would also not have any need. You don't provide mortgage information when you apply.
 
2013-05-14 11:40:21 AM
50k/200k is not preposterous at all for a family that has college age kids. Basic retirement planning says you should have 14x annual pay in savings by the time you retire. The first key is to get a job from the 50K box, the second key is personal responsibility.*

*Let me say this about that. Personal Responsibilty is a great code for YOU to live by. Personal Responsibilty is not a cure that can be applied to social ills.
 
2013-05-14 11:40:41 AM

Tatsuma: .... a million dollar house is a pretty regular (or even small-ish) house in most of the country, Subby. And a family of four living on a $200,000 is not any means rich.


In the world of facts, a million dollar house is in the top 2.3% of home values in the nation.  The median owner-occupied home value is $186,200.
 
2013-05-14 11:40:56 AM

Thunderpipes: Never understood why people think student aid should only be for the poor. People that make money then have to pay for their kids, as well as poor people's kids. And God forbid you go back to school as an adult when you have a good job.



Because most people are not terrible human beings like you.
If you can afford it without aid, then you clearly don't need the aid.
I see it as being greedy, like going to a food bank, when you have more then enough money for food.
 
2013-05-14 11:40:58 AM
I remember this is exactly how it worked when I was about to go to college. My parents on a good year earned 45-50k combined, had socked away 30k in savings and our house was probably worth about 400k(they got it for 150k back in the mid 90s). When the FAFSA stuff came back all my richer friends who lived in the better more expensive half of the city got 2-3K of free money. My letter told me that I was going to get nothing. I was greatly annoyed. It's not that I felt entitled to free money(I won't turn it down if offered though), it's that people whose parents earned far more got free money.
 
2013-05-14 11:42:26 AM
1) Set up bullshiat college
2) Enroll ALL of the poor people
3) Demand billions in Pell grants from the federal government
4) Hand Monopoly degrees to students
5) Collect on loans from as many graduates as can repay on waitress wages
For-profit schools amount to a mass scam, transferring money from tax payers to con artist faux education executives. The Pell Grant needs to die. It might hurt some poor middle-performing students in the short term by forcing them to go to a public school instead of a private one, but it will cause tuition to come screaming down in the free market. The Ivy Leagues will continue to give merit scholarships to top performing poor and middle class high school graduates if they want to preserve their reputations.
 
2013-05-14 11:42:48 AM
Cost of living.....how does it work?
 
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