College Debt Inquiry

Why would you take a commercial loan?

My situation was similar to yours. I got into Emory where I would have 80-100k debt when I graduate, and a bunch of non-targets where I would have 0 debt when I graduate. I didn't know what I wanted to do career-wise at the time, so I didn't want to take on debt for an uncertain future, and didn't go to Emory.

Two years later I "discovered" finance, and kicked myself for not going to Emory. As a previous poster said, ~80k debt is nothing compared to the years of increased income you can get from going to a target. Since you already know you want to do finance, it will probably be worth it.

Half of my debt is federal and the other half is private. As an aside, I was on the pre-medical track for 3 years and completed my neuroscience major by the time I realized I didn't want to go to medical school. Because I was at a great school and maintained a reasonable GPA, my options were still wide-open for any grad school or post-undergrad career path. The school allowed me to land banking / PE internships that would be otherwise unattainable for a neuroscience major at a "non-target".

What're your other college options? If you can go to another school that's almost as good for 50k less, I'd do that,

I think this answer really hinges on what your other options are exactly. 60-80k in loans is nothing to scoff at.

How much more expensive is UT than Miami? If it's 50k+ more expensive, I'd go Miami. If it's

I go to UT op, pm me if you have any questions

just going by the math with my student loans, 60k would be about $500 a month in payments. if you come out of UG making $70k+, you can handle this, assuming you don't have kids and manage other expenses (rent, car, etc.). you may not be able to ball out, but you won't be a pauper either. I'd do my student loans all over again to have the experience I had.

it blows my mind that Miami is cheaper than Texas, I'm guessing you're getting some sort of scholarship from them. If that's the case, and talk to your college advisor/counselor before doing this, but you may want to tell Texas what Miami is offering you to see if they counter.

IMO, student debt is the best consumer debt you can have. Aside from not being able to be discharged in bankruptcy, it's much cheaper than other financing sources in most cases and can be deferred for like two years if you ever get laid off. It's also tax deductible (unless you get a good job in NYC).

My question is how are you getting to $50K / Y for McCombs? That sounds high even for out of state.

Don't take out debt to go to a "better" school. I declined two Ivy acceptances to attend an in-state school.

My logic: attending a top school will make it easier to get where you wanna go, but will it make it $200k easier? No chance. The education gap is not that pronounced so it comes down to the doors it opens. Make networking, self-study, and working toward your dream career your full-time job and "pay" yourself $50k a year for it.

You are a UT McCombs caliber student. Going to a different school will not change that, you'll just have to go the extra mile to show you're on par.

Is that extra mile worth the amount you'll have to take out in student loans?

Not knowing if you're a resident of the Great State of Texas or not, but consider making Texas your legal residence if you go to UT. After a year as a resident of Texas, you should be able to qualify for the In State tuition rate which will greatly reduce your loan burden and cut your academic expenses significantly. I would consider that if you are seriously looking at UT Austin because it will definitely help you out with the cost savings. Gotta love in-state tuition rates.

Also, really? How has no one mentioned that point yet throughout this thread. In-State Tuition at a public state school versus Out-of-State Tuition changes everything. For a bunch of Finance Types, I'm shocked that it skipped right over our heads.

Work during college, either it being a busy boy or a caddie. just work to keep up with living, on-top of applying for a bunch scholarships. If you prove yourself in the first year or so, you get opportunities to can get scholarship at junior/senior year

I think it's easy to lose perspective on how much of a burden ~70k can be. Now, having said that, going to Miami would mean choosing a fairly mediocre school versus one that's top flight for recruiting in the South and still places well in other places.

Still, I wouldn't be able to get over that kind of debt. I suggest that you go to Miami and transfer to a target school in 1-2 years. From what I have heard, transferring from a non-target to a target after 1-2 years is a very viable and underused option. If you work your ass off and maintain a high GPA (3.8+) at Miami, you have a great chance of moving on to a higher tier school with more scholarships.

go to the better school (UT). This wouldn't be true if you were planning on majoring in English or something, but with a business major, you will almost certainly be better off, especially if you want to go into finance after.

If you go to UT, after 1 year you can petition for texas residency, which gets you in-state tuition. Saves you a lot of money for your last 3 years. My tuition was like 9k as a resident. Cost of living is high if you want to live in the most convenient locations, but there are $300-400/month apartments if youre on a budget

Thanks everyone for your help! I have decided to go to UT for the first year and follow the procedure to qualify for instate tuition from the second year onwards. This will leave me with

Thanks everyone for your help! I have decided to go to UT for the first year and follow the procedure to qualify for instate tuition from the second year onwards. This will leave me with less than 30k in debt and a much happier me. The only downside(if anything) is that I will have to work throughout college. This will take up a lot of my time and I might not be able to participate in club sports, but I think it's for the better.

^Are you sure that you'll be able to get Texas residency for your 2nd year onwards? I'm surprised this hasn't been recommended yet, but maybe you should look into attending a cheaper school for a year or two and then transferring over to a target. There are a couple of targets/semi-targets that have pretty high acceptance rates for transfers (e.g. Vanderbilt, UVA, Emory, UNC, etc.). This way you can save cash for a year or two, and then take out loans for the remainder of your undergrad.

Did you get into any other schools that offered financial aid? out of state schools are overpriced; at that price you could be getting a private school education.

internshipsERBB

Assuming you are going to at least a semi-target, check out private lenders like CommonBond, who calculate the risk differently for top schools and are able to offer lower interest rates.

In HS, I had a competitive profile with a 99%+ SAT, 4.0 GPA, and solid ECs. But I chose to attend a non-target school--part of the reason being that the non-target was going to be free (in fact, cash flow positive in some semesters with the abundance of scholarships and grants.) I figured that I did not want $100k in debt in UG. Three things that I noticed were true after a few years.

(1) Education quality is really about the same as any of the top schools. I came out feeling like I could compete intellectually/skills-wise with any graduates from any of the top schools. Good professors are at every school, seek them out, learn as much as you can from them, and they'll take care of you. I owe a LOT to maybe three of my best professors in UG.

(2) Peer group is different. At a lower-ranked school, in general, the classroom conversation is not going to be the same caliber as at a better school. You'll still find great people, but on the whole, you might not be as challenged by your peers.

(3) Career opportunities are undoubtedly limited. Out of my school, getting a job in IB was VERY difficult. I know one guy who did it, but he had to move to NYC without a job and knock on doors for a few months after graduation before getting his foot in. It may also have helped that his step dad was an MD at the bank. I applied to a few banks online, but without networking, peer guidance, OCR, or a decent school on my resume (some online forms didn't even list my college and I'd have to write in "other") it was a lot of auto-rejects.

That said, I still got a solid job at an F500 and was accepted into multiple M7 programs which will help reorient my career. So guess at the end of the day, I still end up with ~$100k of debt. If I could do it over, I'd have gone for the top schools in undergrad--debt and all. But at the same time, I do not regret my decision because $100k is a boatload of debt and I still had an incredible undergrad experience.

A clever way to save some money is to look at majors within the school that may not be offered at your state but are close to the program you want. If you prove the major doesn't exist at a public university in your home state then you get reduced tuition or something close to the in-state rate. For example, a few of my classmates majored in Real Estate Finance which had all of the same courses as the regular finance major only that you had to take an extra RE course or two to satisfy the major. You may be able to do this until you obtain residency and then switch. Just something to look into.

As an Asian, I never understand why some people here recommend going to non-top school to save money. If your career goal is finance or engineering or some other well paid professional career, you should always take better school regardless the cost. In fact, that couple of years after college is the best time in your life to have high loan burden. You don't have kids, family, high medical bills and if you work your ass off, you will save a lot of money to pay off loan (because you don't have time to spend it).

IMO, undergrad brand/alumni network is the most important thing in your early career. It makes everything much easier. Yes, you can go to a non-target, networking like crazy and still end up in some sorts of FO role but if you do the same amount of networking in a target, you may get offer from GS TMT.

You know what's more difficult than competing with someone working harder than you? compete with someone has better family connection, better school brand name and still works harder than you. In high finance, you are going to compete with those ivy graduated, MD dad and 100 hr per week kids. Don't assume you can always make the exception by hardworking.

From another perspective, even if you party too much, become a drughead and work as some hippie freelancer after school, you have a better chance to remake yourself if you have a top school name on your resume. I know a Stanford kid did some random band/music things after school for couple of years and suddenly realized he needs to be serious to his life. He decided to apply to bschool. With a great story and hard stats (low GPA but high GMAT, Stanford hard science), he got into a lower target MBA. Now he works in MBB and everyone likes him because his music talent. Don't tell me a non-name state school kid could rebrand himself this easily.