4 ms·

I have around 200k in investments and 50k in cheque account, resulting in 70k per year fee. Even though that would completely wipe out my savings without payin

I have around 200k in investments and 50k in cheque account, resulting in 70k per year fee. Even though that would completely wipe out my savings without paying the full amount...

jefftk 4y ago
Two things: * If you have a net worth of $250k and they calculate you can pay $70k for the first year, estimating full payment as $70k * 4 ($280k) isn't right. Your net worth will be lower next year, and they'll consider that. * Their goal is to charge you the most you are able to pay, and someone with $250k in savings is able to pay $70k. I think this is all a bad system, for the same reason that a 100% marginal tax rate is a bad idea, but it's not quite as nuts as you're suggesting.
- LigmaYC 4y ago
  >Your net worth will be lower next year, and they'll consider that I was just giving an example to demonstrate how bad their calculator pricing was (280k fees < 250k savings without selling house) if you wanted to make it more realistic I would also take into account that my investments grow too. >Their goal is to charge you the most you are able to pay, and someone with $250k in savings is able to pay $70k. Seems pretty bad to me. Wouldn't pay 7k/year for BU, much less 70k.
  - jefftk 4y ago
    > without selling house Sorry, are you saying the net worth you put into the calculator was more than $250k? Then $70k is even less surprising! (If colleges ignored home values you could put your $250k into repaying your mortgage faster and report having no savings. They'd charge you $0. And if you needed money later you could borrow against the value of the house.)
    - LigmaYC 4y ago
      Ah yes, I should've considered selling my house for BU, thanks for the advice...
      - jefftk 4y ago
        It's completely reasonable for you to decide that "everything I have" is not a reasonable price to pay for college. What I'm getting at, is that these colleges are very careful not to charge you more than it is possible for you to pay. They are extremely good at price discrimination.
        LigmaYC 4y ago
        >What I'm getting at, is that these colleges are very careful not to charge you more than it is possible for you to pay. Never said it was impossible for me to pay, just said it was still expensive.

I have around 200k in investments and 50k in cheque account, resulting in 70k per year fee. Even though that would completely wipe out my savings without paying the full amount...

jefftk 4y ago

Two things: * If you have a net worth of $250k and they calculate you can pay $70k for the first year, estimating full payment as $70k * 4 ($280k) isn't right. Your net worth will be lower next year, and they'll consider that. * Their goal is to charge you the most you are able to pay, and someone with $250k in savings is able to pay $70k. I think this is all a bad system, for the same reason that a 100% marginal tax rate is a bad idea, but it's not quite as nuts as you're suggesting.

LigmaYC 4y ago
>Your net worth will be lower next year, and they'll consider that I was just giving an example to demonstrate how bad their calculator pricing was (280k fees < 250k savings without selling house) if you wanted to make it more realistic I would also take into account that my investments grow too. >Their goal is to charge you the most you are able to pay, and someone with $250k in savings is able to pay $70k. Seems pretty bad to me. Wouldn't pay 7k/year for BU, much less 70k.
- jefftk 4y ago
  > without selling house Sorry, are you saying the net worth you put into the calculator was more than $250k? Then $70k is even less surprising! (If colleges ignored home values you could put your $250k into repaying your mortgage faster and report having no savings. They'd charge you $0. And if you needed money later you could borrow against the value of the house.)
  - LigmaYC 4y ago
    Ah yes, I should've considered selling my house for BU, thanks for the advice...
    - jefftk 4y ago
      It's completely reasonable for you to decide that "everything I have" is not a reasonable price to pay for college. What I'm getting at, is that these colleges are very careful not to charge you more than it is possible for you to pay. They are extremely good at price discrimination.
      - LigmaYC 4y ago
        >What I'm getting at, is that these colleges are very careful not to charge you more than it is possible for you to pay. Never said it was impossible for me to pay, just said it was still expensive.