Taking on 120k of debt for engineering school EE or Aero worth it?

[ModusPwnd]

So I get to pay for your degree(s) with my tax money. This country is f'ed up.

Thank you for your support. There are those that subsidize, and those that are subsidized. If I could manage to get a high pay job, I would. But since I can't I shall be in the latter category.

But actually, taxes pay for most of most people's degrees. Public schools are subsidized for even full tuition payers. My undergrad full tuition was only 1/3 of the "true" cost, the other 2/3 were subsidized by taxes. My second school was more like 50/50.

 

[ParticleGrl]

Awesome, so I only rang up $3500 in a college loan (worked summers, lived at Mom and Dad's while getting a degree) and paid it back in less than 6 months (no interest).

When did you get your degree? Its hard for me to believe that someone can self-fund an education in today's tuition environment just by working over the summer and living at home. Even mid-tier state schools have grown quite expensive.

In the state in which I did gradschool, the flagship university (which has the decent engineering program) cost about $20k a year in just tuition for engineering students(for residents). This increased tuition for engineering programs seems to be fairly common. Including fees (including lab fees) and books, you are probably talking at least $25k for attendance of an engineering or science program. If you don't happen to live in the city its located, you'll pay another 10k or so in housing, maybe more.

Work study jobs paid $8.50 an hour and were capped (the cap was based on an individual student's financial aid package), and any money made in jobs outside of the work-study program reduced your eligibility for need-based financial aid (the first thing removed from your financial aid eligibility were grants).

A student working 15 hours during the school year and full time over the summers might make ~10k in a year. This would still leave them in $15k a year to cover, either by financial aid or from their parents, even if they are living at home. And this is tuition for the state school.

When I was in college, I worked full time year round (taking nights and weekends at a restaurant) and still graduated with $44k in debt.

 

[2milehi]

^^^^ I got my degree in 1995 for The Colorado School of Mines. I was a non-traditional student and I started my BS degree pursuit when I was 23 years old. I was able to get a grant (Pell I believe) that paid for about half of the tuition and I had about $5,000 saved up when I started college.

I looked at the tuition for CSM now and see the cost is $17k a year.

 

[SteamKing]

Every school is going to have a different set of financial characteristics associated with attendance. One school, Cooper Union, made news recently because it was dropping its 'free tuition' for undergrad attendance:

http://www.nytimes.com/2013/04/24/n...dergraduates-tuition.html?pagewanted=all&_r=0

While the number of such schools is dwindling, C-U was not the last such school in this country. This is why sources like the US News & World Report 'Best Colleges' report is a handy guide to have.

There is still only one curriculum and one degree offered, but if you want to study naval architecture & marine engineering, and not pay a lot to do so, my alma mater, the Webb Institute, is still 'tuition free', although you get to pay a room & board fee (all students live on campus) and you've got to buy your textbooks:

http://www.webb.edu/

Webb celebrates its 125th anniversary this year, and the 'tuition free' feature derives by benefit of the financial endowment of its namesake and founder, William Henry Webb. (Caution: shameless plug)

One of the benefits also deriving from this windfall (more valuable in years past) is that all paper for schoolwork (loose leaf, drafting, graph, etc.) was available to students at no charge. With the rise of computers, I'm not sure how much paper is used nowadays by the students.

So, it is still possible, but ever more unlikely, that one can find an almost free college education in the US. Certainly, there is a wide range of cost one can pay to obtain the same degree at different institutions, which is why it is important to do careful shopping for an education as one would do when purchasing any large-ticket item, like a house or a car.

 

[AsianSensationK]

Yea, you do have to pay taxes on the forgiven portion after the 25 (or 10) years. You don't need a tax professional to find that out. Its still but a small fraction of the debt and thus I am still happy I only have to pay back part of the debt. (Unless I manage to get a high paying job, in which case I would be happy to pay off my loans.)

If you're only paying $40 a month for 25 years on a 120K debt, there will be more than 120K in debt forgiven. The federal government is tacking onto your debt each month you don't meet the interest on your debt.

Think about it this way. 120,000 in debt at a 2% rate is $200 in interest. If you don't pay the full $200 in interest, your balance grows by what you didn't pay. In this case, $160 a month. At the 6% rate I think student loans are more likely to be at, interest is 600 a month. The payment you'd need to pay down that debt in the standard 10 year timeframe is $1104 a month at the 2% rate and $1332 at the 6% rate. Those numbers start looking like new york rents the higher you go.

So the most important tip for a thread like this is everyone here needs to learn to use the excel finance functions and use them to help make big financial decisions. The federal government will currently help borrowers with income contingent repayments to better match their monthly income (you'll pay 10% of what you make if you're poor), but that really doesn't change the term of the loans you agree to. Interest will continue to get tacked on to the balance each month you pay less than what you owe.

You don't want to set yourself up to borrow a whole lot more than what you could reasonably pay back each month under the standard repayment plan, which for most people is more in the realm of 30K or so (i.e. around 300-400 a month). So I think the best advice is to pick a cheaper school and figure out how to pay as much as you so you borrow the least you can.

 

[ModusPwnd]

Im not in that much debt. That was the original poster's question. My wife and I have less than half of that for our 4 degrees combined. I agree a cheaper school is in order. But it seemed that people have the wrong impression on how student loans work... Thinking you need to show financial hardship to be on income based repayment (you dont, they call it "partial financial hardship" which is simply when income based repayment would be lower than the 10 year plan), or that student loan payments can keep you poor (of course some here think that making the median american family income is poor...).

Also, you don't pay 10% of what you make. You pay either 10 or 15 of your "discretionary monthly income" which is the difference between your gross income and, iirc, 3/2 of the poverty line for your family.

 

[YAHA]

Hey guys I've gotten accepted into RIT Rochester Institute of Technology for electrical engineering and Embry Riddle for Aerospace engineering. I'm a non traditional student aged 28 with a BA in Econ who always had a passion for engineering. I am still making up my mind between EE or Aero.

I want to go into engineering for two reasons: job stability (more than the field that I'm in) and intellectual enjoyment. I took calc 1 and calc 2 and physics 1 and 2 in undergrad and did really well so I would be okay with the heavy math just in case anyone is wondering.

Most of my aid is in the form of loans and that comes to about 30k a year in loans with the rest covered by need based aid. 30k * 4 = 120k over the course of 4 years.

My question is, I've been reading about engineers being laid off and outsourced and having trouble finding employment especially when they are older. I've read so many posts about how hard its gotten for engineers to find jobs. I know the BLS the gov puts out is really not indicative of the reality on the ground when it comes to job hunting and job stability.

Unlike medicine where the loans are very large but the pay and job stability is there to service the debt. I don't know if the same can be said about engineering.

Am I taking too big of a financial risk? I'm scared that at my age at 28 with a 120k loan on my head that it doesn't make sense and that I should just keep working in finance, even though the threat of losing your job is there all the time, I won't have a loan on my head

Taking financial risk? No. More like you will ruin your life. Don't do it man.

Learn engineering on your own, study it, invent products, etc. There are resources online to study the same material that any engineer studies for FREE. If you really want to get a full experience, shell out some $$$ on actual equipment like oscilloscopes, boards, microcontrollers, and other stuff. Believe me, it will be MUCH cheaper than $120K. In fact, you can probably set up an excellent beginner EE lab in your bedroom for less than $2K.

If anyone wants to tell me that it is not that simple, one needs a job, blah blah blah, yes I know. But keep in mind that if you are truly good and talented (at engineering in this case), you will either start something of your own (at least enough to get you by) or be noticed by a decent company (there was a recent article on Google's increased rate of hires for technical positions of people without degrees at all ).

Just watch these. Hope that helps. If not, well, good luck.

 

[SteamKing]

This article may be of interest to those planning on taking a financial plunge into college life:

http://www.insidehighered.com/news/...discounts-again#sthash.MlPFRnRZ.RI1EUJfl.dpbs

Buying an education is like buying a car: negotiate for your best price, and if the dealer won't budge, threaten to walk away from making a deal.