Going to college - I can't afford it!

Posted by Maneesh Sethi :: September 7, 2007 @ 10:00 am

Several times over the last few years, my parents' friends have come to my family asking for help with getting into college (my dad runs a college search and scholarship company). Every time, my dad would mention several schools that he recommended: Stanford, Harvard, Princeton, etc. And every time, the parents' eyes would gloss over like a kid in school watching Jessica Alba teach math.

"No, I don't think we can afford those schools," they would say. "Of course you can," my dad would respond. At this point, an enveloping sense of rage and anger would rise up in the office, culminating in either a fist fight or a gruff and brisk exit by our now ex-clients.

The last part of the story isn't true---I swear! My dad is a nice guy! But what his clients didn't understand was that paying for college is like buying a necklace in New Delhi, India --- you never pay the marked price. College financing can be as much a negotiation as buying things from the farmer's market.

When I was deciding what school to go to, I had narrowed my choices to Stanford and UC Berkeley. UC Berkeley then offered me a scholarship, called the Regents, which was the best scholarship the school gave. It included things like guaranteed housing, super cheap tuition, and things of that nature. Naturally, being a public school, I expected it to be cheaper already. But with the Regents? I had to see how cheap it would get.

A few weeks later, I got Berkeley’s financial aid package. The tuition was cheap---very cheap. But a day later, Stanford's package came. I looked closely and realized that Stanford was charging me only $900 more per YEAR. That's about $100 per month! How was this possible?

The reason why is that the premier schools, many of them private, offer excellent financial aid. Additionally, the government offers grants to cut the cost down even more, plus several loan programs to help manage the remaining expense. When all is said and done, the most expensive private schools can occasionally be even cheaper than public schools (especially if your family is relatively poor).

So, if you haven't decided on a college or know people who are applying, tell them to aim high for the college of their choice and worry about the cost afterwards. You might be surprised at what your money can get you. And if any of your friends tell you that there is no way they can afford a top-tier school, do what I do. Look at them, shake your head, and walk away muttering 'idiot.'

But then help them.