April 25, 2012

HIGHER EDUCATION BUBBLE UPDATE:

Today, a good private college costs between $40 and $50K a year; many state universities will run you over $20K a year. Total cost for four year now: $150K or more. That’s not even close to a starting professional salary, except for the handful of top students who go to Wall Street. I’ve run this shift by some college administrators and get the same answer: “Well, very few people actually pay those full tuition rates. Most students get some amount of financial aid, so the real cost is much lower.” To which I respond: “Determining what college is going to cost you ought not to be like haggling with a used car dealer.” (Memo to parents by the way: if you have a child admitted to several colleges, you should treat the financial aid offices exactly like used car dealers, and beat the hell out of them for the best deal. Apologies here to used car dealers; you are actually more scrupulous than college financial aid departments.)

What other industry forces you to give them detailed financial statements before they’ll decide on your price?

Related: Rigor, please.