How Students Cope with the Student Loan Regret, and the Decision Between Universities with Better Financial Aid Packages & Schools With More Academic Allure
Let’s play a game of would-you-rather: Would you rather attend a highly prestigious university that provided little to no financial aid, or would you rather pick a less established university that offered a significant scholarship?
This isn’t a hypothetical situation; in fact, it’s a commonplace conundrum faced by many students choosing an undergraduate institution. Amongst myriad factors that weigh on the college selection process, cost of attendance and academic merit are both heavyweight contenders. However, the school with the best academic appeal is not always the school that offers the best financial options, leading one to choose a tie-breaking factor: quality of education, or quantity of financial aid. If it’s the former, that often means that student loans must bear the crux of the financial burden.
With a Wells Fargo study finding that a third of millennials regret choosing to attend college versus entering the work field immediately after high school, it’s clear that many students who played this ‘would-you-rather’ game might’ve chosen differently. Seven out of 10 students now graduate with debt, and the Consumer Financial Protection Bureau estimates total student loans in the U.S. exceeded more than $1.2 trillion in 2013. Student loan debt far surpassed credit card debt (a whopping $857 billion in 2013) and now ranks as the second largest form of consumer debt falling behind only home mortgages. But numbers and statistics aside, there’s an even harsher reality behind waiving scholarships for better schools for many of the students who make that decision. Los Angeles-based writer Nicole Adlman knows all about that.
A bright and promising student, Adlman had her pick of colleges. Some with better financial aid packages, and some with better reputations. Ultimately, she chose to forgo two full-ride scholarships to attend a more prestigious university with little financial aid. It is a decision that haunts her to this day.
“I received full-tuitions to Northeastern University and Penn State— Northeastern was merit-based, Penn State was a diversity scholarship—and an assortment of money to other schools to which I applied,” Adlman said. “Ultimately, I picked the school that sound the best on paper—the University of Miami.”
Of the 11 universities she applied to in 2008, Adlman had her heart set on Miami. Coming from New York, she was drawn to the sunshine, the beach and the school’s top-tier ranking. She was overjoyed when she received her acceptance letter. There was just one issue, or a lack thereof: Funding.
“Miami offered me nothing at first,” Adlman said. “I wrote a letter to the president, Donna Shalala, telling her how much I'd like to go to her school—after the letter, the financial aid office offered me $11,000 a year.”
The $11,000 annual scholarship alleviated the university’s hefty price tag—$49,000 a year in tuition, and then room and board amongst other expenses— and helped put Adlman’s mind at ease. She’d worked hard for Miami. She wanted Miami. And now, with a discounted tuition of $38,000 a year, she decided to go for it.
“Stupidity, sunshine and a desire to be far from home drew me to the school. I never imagined that I wouldn’t be happy there,” she said.
When Adlman arrived, her version of academic paradise became more mind-numbing doldrums. She disliked the campus, her classes were painfully dull and suddenly the sunshine just became a constant reminder as to the expensive mistake she’d made.
“My time at Miami was a breeze. A painful, excruciating breeze,” she said. “I graduated in three years because I wasn't challenged—I could pile 18 to 21 credits at a time and still make it out of the semester with a near 4.0.”
A degree in her hand and her future ahead, Adlman didn’t realize what a taxing burden her loans would be until after graduation. The payments crept up, and she struggled to make ends meet. Low-balance emails from the bank plagued her inbox and voice mail. What was worse, she had a teeming pain that the only thing her loans had really bought her was unnecessary stress and an education that wasn’t worth it.
Today at 24 years old, Nicole is working as a writer. She’s paying her student loans every month, although her parents have taken over as the primary holders. Still, her decision to forgo a full-ride education gives her great anguish and distress.
“I would be a different person, an alternate universe-Nicole if I had taken one of the full-tuition scholarships,” Adlman explained. “It will be a very, very long time before I pay off all the loans. Time in which I could be married and have children, but the money that would have gone toward a nuclear family will go toward paying off loans. The monthly payments are essentially another apartment rent after the real apartment rent.”
A Parallel Universe
While Adlman’s tale of student loan heartache isn’t all that uncommon, it’s not the only scenario for students who forgo better financial aid packages to attend better universities. Graduating senior Kendall Rowden is proof of that.
Like Adlman, Rowden had her heart set on a dream school. She wanted to study psychology and non-profit management at Pepperdine University, and she knew she’d have to sacrifice to do it. So she studied rigorously, piled on the AP courses and bolstered her college resume with volunteer hours, clubs and extracurricular activities. After months of waiting, Rowden received news from the university that she’d been admitted, but her financial aid package was not what she’d hoped it would be.
“When it came down to picking schools, there were two main options: the honors college at Arizona State University and Pepperdine. Arizona was practically a full-ride because I lived in-state and had good grades, but Pepperdine was a much better school,” Rowden explained. “At first I got $25,000 a year in scholarship, but that wasn’t enough to cushion the $60,000 a year tuition blow. So I appealed, and ended up getting around $40,000 a year.”
Rowden’s financial situation wasn’t one where she could simply make up the difference in tuition out of pocket. Loans were a must. But instead of tackling the loan burden herself, Rowden’s parents offered to tackle the finances for her.
“My mom and dad cried at first because they thought they couldn’t afford it, so they said they would do anything to get me here because I worked so hard,” Rowden said. “My parents took out the loans and are paying them. I signed the papers but they pay for them. I’m never going to have to pay my parents back; it’s an incredible thing that they’re doing for me.”
Rowden’s parents, who now reside in Texas, both paid for their college educations through loans, and hope to spare their daughter the burden of starting a professional career with loan repayments. The price is high, but the value of their daughter’s education is higher for them.
“I don’t regret taking out student loans because Pepperdine is my dream school and I worked so hard to get here. My degree was worth the cost,” Rowden said. “Because of my hard work at Pepperdine and just having the university’s name on my degree, I got a full-ride offer for graduate school [at Texas A&M].”
What’s more, Rowden is motivated by her parents sacrifice. She was driven before, but now she’s more determined than ever to succeed in her academic pursuits.
“The thing that makes me so motivated to make good grades is knowing that my parents sacrificed so much for me to be here and I need to take advantage of the education I have, cant screw it up,” she said. “To others in my position, I would say go for the better school, in the end you’ll get a better degree more people will be willing to hire you.”
Words of Wisdom
There is no cookie-cutter mold for picking a college, and each student’s decision carries different implications and benefits. Not all students who choose to take out loans will regret that decision, although many will. The problem then, is this: Why are many students learning about the implications of loans after they graduate?
“In high school, they plaster you about scholarships but the reality is most people are going to take out loans. So why isn’t there more loan education in the first place?” Rowden said.
Rowden isn’t alone in that assumption either. In a 2013 Wells Fargo study, 79 percent of millennials surveyed said they wish they been taught more about personal finance in high school, particularly in regards to how loans work. Adlman, too, expressed this desire for early student loan education as well.
“My guidance counselor, Mrs. Wilson, did nothing but make sure I applied to ‘X’ number of schools. There were no real in-depth discussions about what factors should be most important when coming to a final decision,” Adlman said. “I hate to think that all my loan issues could’ve been avoided had I been taught about loans before I took them out.”
And while students like Rowden would make their decision to take out loans all over again, Adlman advises caution.
“Above all, take the money,” Adlman said. “There may be a lot of anguish, guilt and Chase low balance notifications if you don't. Be educated before you choose where to go. Do the math. But above all, take the money if money is offered to you. An undergraduate education isn't worth what they charge in the U.S., which means it absolutely isn't worth paying for out of pocket (whether your own or a lender's.)“
Let’s play a game of would-you-rather: Would you rather attend a highly prestigious university that provided little to no financial aid, or would you rather pick a less established university that offered a significant scholarship?
This isn’t a hypothetical situation; in fact, it’s a commonplace conundrum faced by many students choosing an undergraduate institution. Amongst myriad factors that weigh on the college selection process, cost of attendance and academic merit are both heavyweight contenders. However, the school with the best academic appeal is not always the school that offers the best financial options, leading one to choose a tie-breaking factor: quality of education, or quantity of financial aid. If it’s the former, that often means that student loans must bear the crux of the financial burden.
With a Wells Fargo study finding that a third of millennials regret choosing to attend college versus entering the work field immediately after high school, it’s clear that many students who played this ‘would-you-rather’ game might’ve chosen differently. Seven out of 10 students now graduate with debt, and the Consumer Financial Protection Bureau estimates total student loans in the U.S. exceeded more than $1.2 trillion in 2013. Student loan debt far surpassed credit card debt (a whopping $857 billion in 2013) and now ranks as the second largest form of consumer debt falling behind only home mortgages. But numbers and statistics aside, there’s an even harsher reality behind waiving scholarships for better schools for many of the students who make that decision. Los Angeles-based writer Nicole Adlman knows all about that.
A bright and promising student, Adlman had her pick of colleges. Some with better financial aid packages, and some with better reputations. Ultimately, she chose to forgo two full-ride scholarships to attend a more prestigious university with little financial aid. It is a decision that haunts her to this day.
“I received full-tuitions to Northeastern University and Penn State— Northeastern was merit-based, Penn State was a diversity scholarship—and an assortment of money to other schools to which I applied,” Adlman said. “Ultimately, I picked the school that sound the best on paper—the University of Miami.”
Of the 11 universities she applied to in 2008, Adlman had her heart set on Miami. Coming from New York, she was drawn to the sunshine, the beach and the school’s top-tier ranking. She was overjoyed when she received her acceptance letter. There was just one issue, or a lack thereof: Funding.
“Miami offered me nothing at first,” Adlman said. “I wrote a letter to the president, Donna Shalala, telling her how much I'd like to go to her school—after the letter, the financial aid office offered me $11,000 a year.”
The $11,000 annual scholarship alleviated the university’s hefty price tag—$49,000 a year in tuition, and then room and board amongst other expenses— and helped put Adlman’s mind at ease. She’d worked hard for Miami. She wanted Miami. And now, with a discounted tuition of $38,000 a year, she decided to go for it.
“Stupidity, sunshine and a desire to be far from home drew me to the school. I never imagined that I wouldn’t be happy there,” she said.
When Adlman arrived, her version of academic paradise became more mind-numbing doldrums. She disliked the campus, her classes were painfully dull and suddenly the sunshine just became a constant reminder as to the expensive mistake she’d made.
“My time at Miami was a breeze. A painful, excruciating breeze,” she said. “I graduated in three years because I wasn't challenged—I could pile 18 to 21 credits at a time and still make it out of the semester with a near 4.0.”
A degree in her hand and her future ahead, Adlman didn’t realize what a taxing burden her loans would be until after graduation. The payments crept up, and she struggled to make ends meet. Low-balance emails from the bank plagued her inbox and voice mail. What was worse, she had a teeming pain that the only thing her loans had really bought her was unnecessary stress and an education that wasn’t worth it.
Today at 24 years old, Nicole is working as a writer. She’s paying her student loans every month, although her parents have taken over as the primary holders. Still, her decision to forgo a full-ride education gives her great anguish and distress.
“I would be a different person, an alternate universe-Nicole if I had taken one of the full-tuition scholarships,” Adlman explained. “It will be a very, very long time before I pay off all the loans. Time in which I could be married and have children, but the money that would have gone toward a nuclear family will go toward paying off loans. The monthly payments are essentially another apartment rent after the real apartment rent.”
A Parallel Universe
While Adlman’s tale of student loan heartache isn’t all that uncommon, it’s not the only scenario for students who forgo better financial aid packages to attend better universities. Graduating senior Kendall Rowden is proof of that.
Like Adlman, Rowden had her heart set on a dream school. She wanted to study psychology and non-profit management at Pepperdine University, and she knew she’d have to sacrifice to do it. So she studied rigorously, piled on the AP courses and bolstered her college resume with volunteer hours, clubs and extracurricular activities. After months of waiting, Rowden received news from the university that she’d been admitted, but her financial aid package was not what she’d hoped it would be.
“When it came down to picking schools, there were two main options: the honors college at Arizona State University and Pepperdine. Arizona was practically a full-ride because I lived in-state and had good grades, but Pepperdine was a much better school,” Rowden explained. “At first I got $25,000 a year in scholarship, but that wasn’t enough to cushion the $60,000 a year tuition blow. So I appealed, and ended up getting around $40,000 a year.”
Rowden’s financial situation wasn’t one where she could simply make up the difference in tuition out of pocket. Loans were a must. But instead of tackling the loan burden herself, Rowden’s parents offered to tackle the finances for her.
“My mom and dad cried at first because they thought they couldn’t afford it, so they said they would do anything to get me here because I worked so hard,” Rowden said. “My parents took out the loans and are paying them. I signed the papers but they pay for them. I’m never going to have to pay my parents back; it’s an incredible thing that they’re doing for me.”
Rowden’s parents, who now reside in Texas, both paid for their college educations through loans, and hope to spare their daughter the burden of starting a professional career with loan repayments. The price is high, but the value of their daughter’s education is higher for them.
“I don’t regret taking out student loans because Pepperdine is my dream school and I worked so hard to get here. My degree was worth the cost,” Rowden said. “Because of my hard work at Pepperdine and just having the university’s name on my degree, I got a full-ride offer for graduate school [at Texas A&M].”
What’s more, Rowden is motivated by her parents sacrifice. She was driven before, but now she’s more determined than ever to succeed in her academic pursuits.
“The thing that makes me so motivated to make good grades is knowing that my parents sacrificed so much for me to be here and I need to take advantage of the education I have, cant screw it up,” she said. “To others in my position, I would say go for the better school, in the end you’ll get a better degree more people will be willing to hire you.”
Words of Wisdom
There is no cookie-cutter mold for picking a college, and each student’s decision carries different implications and benefits. Not all students who choose to take out loans will regret that decision, although many will. The problem then, is this: Why are many students learning about the implications of loans after they graduate?
“In high school, they plaster you about scholarships but the reality is most people are going to take out loans. So why isn’t there more loan education in the first place?” Rowden said.
Rowden isn’t alone in that assumption either. In a 2013 Wells Fargo study, 79 percent of millennials surveyed said they wish they been taught more about personal finance in high school, particularly in regards to how loans work. Adlman, too, expressed this desire for early student loan education as well.
“My guidance counselor, Mrs. Wilson, did nothing but make sure I applied to ‘X’ number of schools. There were no real in-depth discussions about what factors should be most important when coming to a final decision,” Adlman said. “I hate to think that all my loan issues could’ve been avoided had I been taught about loans before I took them out.”
And while students like Rowden would make their decision to take out loans all over again, Adlman advises caution.
“Above all, take the money,” Adlman said. “There may be a lot of anguish, guilt and Chase low balance notifications if you don't. Be educated before you choose where to go. Do the math. But above all, take the money if money is offered to you. An undergraduate education isn't worth what they charge in the U.S., which means it absolutely isn't worth paying for out of pocket (whether your own or a lender's.)“