building wealth in the pursuit of happiness

Apr 28, 2008

best financial move in college, part 1

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Patrick, of Cash Money Life fame, has tagged me to give my best financial move in college. This “organically growing” meme was started by plonkee. This will be a two-parter because I didn’t want a post that looked like a short novel…

ventress hall

I have what might be an “unallowed” answer, so I’ll give both of them. One of them had a huge impact, one of them had less of an impact, but both were important long-term decisions.

Best Financial Move in College #1: I attend a public university.

I will be as clear as possible about this: my choice of college has made more of an impact on my financial life than any other decision I have made. A little background: I was a good student in high school. I was class valedictorian, I had high scores on my SAT and ACT exams, I was a varsity athlete. I had received a full scholarship to attend school in Germany as an exchange student; I was an International Science Fair finalist; I had clubs and academic honors and extracurriculars out the yin-yang. I applied to a fairly wide spread of colleges, ranging from my hometown state university to small private liberal arts schools (one I really liked I’ll call Tiny Private) to well-known-very-good-but-not-Ivy schools (one of which I will call Regional Private) to the big grandaddy of them all, Harvard.

I got accepted to every one. I got scholarships to every one. I got tennis scholarships, academic scholarships, etc. etc. However, many people are surprised that anyone who was accepted to Harvard would turn it down. I did. I applied to Harvard on a whim, with no serious intention of attending even if I was accepted. I sent in the application on the deadline date. I started the application, handwritten, in black ink and when that pen died I finished in blue ink. I did it because one of my friends told me there was no way I could get in, and I took the bet. I had no intention of going there. I actually had my mind set on Regional Private - and received a full scholarship there, too.

But one school was ferocious in their recruitment - my hometown state university, which I’ll call Hometown State (for obvious reasons). They were relentless - they gave me not only a full scholarship but they swamped me with calls, meetings with academic deans, calls from alumni, even additional scholarships to cover the costs of books, fees, housing, and on and on. Part of this was due to my dad’s relationship with the university, but a lot of it was simply because I was well-known there already - friends of mine had parents who were professors or administrators or otherwise associated with the school.

I visited Regional Private School and detested the people I met, who were condescending and intellectually dead rocks. Harsh, I know, and maybe it was bad luck, but as a multi-generational legacy (I would have been a third-generation student there) but I couldn’t stand it on multiple visits, including a “new prospects weekend.” I toyed with attending a few other schools, including Tiny Private, but I decided the cool atmosphere didn’t make up for the fact that nobody had ever heard of them or that the academic and social programs were limited.

I decided to go to Hometown State. It was the best decision I ever made financially, for one reason: I actually made a profit attending school. After tuition, fees, books, fraternity dues, food, everything I made a profit. I got a bachelor’s degree and started day one of my postgraduate life with money in the bank and no debt. I think (although I don’t know) that even with full scholarships at Tiny Private or Regional Private or Harvard I would have had enormous expenses not covered by tuition scholarships. My parents would have covered many of those expenses, I’m sure, but I would still have struggled.

I have never regretted attending Hometown State for a minute. To this day I point to that as one of the best decisions I ever made. I loved college. I did well academically. I was again active in all sorts of things: club sports, varsity lacrosse, a fraternity where I was pledge trainer, social chairman and rush chairman at various times, and interest groups from a Russian-language club to political organizations. I did all of this without having one minute’s strain or stress or worry about how I could afford this, or how I was accumulating debt. And I have still done well in my career.

That is my “unfair” answer, since it wasn’t IN college. I’ll give my “fair” answer in my next post.

photo credit: me! an original photo!

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Viewing 12 Comments

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    Not many people can say they profited by going to school - that's a very cool thing. It sounds like you made the best selection for you and your personality, which is much more important than going to school to get a certain school's "name" on your degree. I look forward to reading the second installment!

    (oh, and I think I broke the rules too... I wrote several different good choices, when I could have boiled it down to - "I let someone else pay for it."). ;)
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    Can you honestly say it was a sound *financial* move? I think the concept of utility would better describe your decision.

    All the numbers indicate your chances of becoming more successful, financially wise, were much greater attending an Ivy League university. You might have gained more speaking in whole terms (like utility) but as financials go I don’t agree with the bottom line (just my personal point of view of course).

    It does sound like it was the right decision for you to make.
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    @Dorian: I suppose it depends on how you want to look at your finances. My way of looking at it is that my net worth is probably further along at this point in my life than it might have been had I attended an Ivy and entered the same profession that I did (accounting). Now, if I had gone into investment banking or something of that sort, my net worth might be significantly higher, of course. But I took the question to be 'what decision made in college was the smartest one that had the best impact on my finances assuming everything else had gone the same.'

    So in other words, I avoided incurring debt, still received a degree that paved the way for PhD and MBA school, etc. I did not emerge from college deeply in debt. The long-term question of whether I would have received a better job, had a different career, etc. is a separate one in my mind.

    My (somewhat rambling) point is just that it made good financial sense to graduate debt-free from college. You could argue that now I might be better off in terms of gross income had I gone to Harvard, but then again I would also have been better off had I attended Hometown State's medical school, too. So that's just a different question. But given what I wanted to do, where I wanted to do it, etc., it was the best decision for me.
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    I remember how much cheaper hometown state would have been for me. And if I'd been interested in engineering, agriculture, computer science, chemistry, etc, it would have been a good move. However their English undergrad program was crap (grad is supposed to be better) and I was going to study English, so it seemed like a bad move.

    I say going to a school you can afford, including scholarships, is an excellent financial move. I did pick the school which cost the least when you subtracted the scholarship they offered me from tuition. (A school with higher tuition offered me a scholarship which brought them below cheaper school + its scholarship).
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    @Mrs. Micah: I couldn't agree more that if you want to study a particular subject and you feel that one school is significantly better than another for that subject, you should go there. It's a good clarification that you make: the number you look at should be net cost, not just raw tuition. I'm not sure anyone in this country pays list price tuition. Almost everyone I've known had some kind of combination of scholarships/grants/aid/loans/etc. that brought that number down a bit.
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    I think the number one best financial move you can make in college is to make sure you're studying the right thing/figuring out who you are. It took me about two and a half years in college to figure out that I wasn't majoring in the right thing for me - if I had spent some time sampling more areas early on and thinking about my moves more carefully, I would have seen this much sooner and saved myself about $15K in student loans.
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    I got a shock when I saw this photo--I walk by that building every day! I'm about to graduate, and yes, I've making a profit, too--not to mention they've paid for me to study abroad five times over my college career. I originally wanted to get out of this state and head to a private school in CA, but now I don't regret my choice at all.
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    @Trent - I guess you're one of the lucky ones than. You figured it out pretty soon and acted on it. I think the majority of people wish they had taken different majors....
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    I reckon this anecdotally proves that it's true what they say about people that reject Harvard - they'll do at least as well as those who actually attend.

    Me, I couldn't have stayed at home for Uni, and moving 100 or so miles away (hey, that's a long way in England) is one of the best things that I did. Not as cheap as staying at home though.
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    @Megan: Funny that you recognized it! I spent most of my time in school just around the corner :) I guess at least one person knows where I went to school, then! My secret bat-identity is at risk!

    Just kidding. That's a neat building although it really sticks out a bit, doesn't it?
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    I applied to and go into 5 schools. The cheapest school for me to attend after all the financial aid packages were presented also happened to be my first choice: MIT. Good choice on not going to Harvard... everyone knows the hardest part about it is getting in ;D
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    This was such a good article not many people can profit by going to a good school. A great tool out there to draw in people to what you are trying to promote sell etc. is Glyphius. It's a copywriters dream :)
 

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