Postsecondary education questions: What if money is no object?

Here's a question:

Suppose you were filthy, stinkin' rich. You have so much money that you don't even have to think about saving for retirement. So much that you can, effectively, pay cash for all of your children to take as long as they want to go to school anywhere they want, and to major in what they want.

The question is... Should you?

Should you write each of them a blank check?

Should you put conditions on the money?

Should you pay for some educations, but not others?

+ + +

Granted, this is a highly rare hypothetical. But maybe we can use it to get at some general principles.

What's the stereotype of the rich kid whose parents paid for everything they wanted? Not so positive, is it?

But at the same time, isn't there a stereotype against "stingy" wealthy parents who don't help their kids out with college? We all understand that not everyone can afford to pay a lot towards college, but when parents can pay for it, is there an assumption that they should?

Well, let's think about it. Is there ever a time when a parent (who can pay)...should NOT pay?

+ + +

Off the top of my head, a parent shouldn't pay for university if he expected the young person would harm himself with the money or the opportunity. Suppose we're talking about a young adult who has a problem with alcohol or drugs, or a history of dangerously impulsive behavior. Unless the parent has the means to keep tight control of the purse strings (so that money intended for college expenses can't be diverted), putting that much money in the hands of someone so irresponsible could be a grave error.

But suppose it isn't so clear-cut...

Since money isn't an object, should the wealthy parent steer adult children to more prestigious universities? To religious ones? Should the parent steer the adult offspring to a college where most of the peer group will also be wealthy, or of the same religion? To a place where the peer group will be more diverse? Should the young person be allowed to choose whatever he or she wants? Is it necessary to have a concrete plan before beginning, since the family is wealthy enough to cover any contingencies?

Should the wealthy young person be made to come up with some of the money on his own, on the grounds that he needs to learn self-sufficiency and a work ethic? Should he learn how to make his own way in the world, at least somewhat? Or is that a pointless exercise for a kid who can afford anything, and ought he instead learn how to be a model rich person, busy with civic engagement and philanthropy, and passing down values to the next generation?

What do you think? What would you do?

 

Comments

[Amy F]

My parents paid cash for my Caltech undergraduate degree even though I was offered half-tuition+ merit scholarships to schools like Carnegie Mellon and the U of MN. My dad went to Caltech and I grew up hearing stories of its awesomeness. If I had insisted on going to one of the scholarship-offering schools, they wouldn't have forbid me, but I always knew that they were very happy I chose to go to Caltech despite the higher cost. They verbally made clear to me in high school that they preferred I leave the state for college so I could experience something other than Minnesota for awhile. And just like my dad, I came back after my schooling was done and started a family here. In my post-college years they essentially paid the down-payment on our first house and have given substantial cash gifts at other points, but it's never an expected thing I plan for. I'd say that their help has meant that I've pretty much been able to be a stay-at-home-mom with only side jobs. We probably would have waited longer to have kids without their safety net.

I always knew my parents had plenty of money when I was a kid, but they lived on much less and only spent for occasional fancy vacations. They could have bought a big ritzy house but instead they saved enough to cover both my sister's and my college educations with some left over and have single-handedly paid for a substantial number of projects at their small church and various other charities. As for the next generation, they've established accounts for each of my boys that should cover the cost of in-state tuition. They figure that beyond that needs to be paid by scholarships or my husband and I or loans or whatever. I'm grateful that this allows me not to worry about saving for college while living off of a teacher's salary.

My parents aren't the super-rich that you probably intended, but it's an example of a family that prioritized education and giving.

[Bearing]

That's a really nice story, Amy.

[DarwinCatholic]

It seems like a difficult hypothetical to answer, since I think the answer would vary based on many circumstances. The answer I can think of sounds far too general: I don't think that virtually unlimitted means would indicate a necessity (or desirability) of meeting any and all financial requests. It just means that "that would be the right thing to do, but we don't have enough money" would never be the answer. One would still evaluate any request for financial assistance based on the basic criteria of "Does this seem like the best thing for you to do?" and give advice accordingly.

To what extent one agree to finance things against one's advice would probably vary even more on an individual basis.

[Bearing]

Darwin, I think you are probably right that it doesn't change the game all that much, except it also removes the excuse "we can't afford to finance your time-wasting hijinks." if you don't want to fund something, and you actually do have the money, you are forced to say, "no, I don't want to support that."

[Jennifer Fitz]

Oh, if I had the money, I'd totally pay for the fantabulous liberal arts education being offered here and there among the better Catholic colleges these days.

Pretty much, my rules would be: You have to be working at something -- volunteer, school, for pay, you choose -- acting like a responsible citizen, and not wasting my money. Do those, heck yeah, why did God (hypothetically) give me the means to educate you so well?

That said, I have a friend who had a wealthy peer go through grad school (sciences) with no assistantship. Everyone made fun of her behind her back, because failure to be awarded a GA position was regarded as a sign of intellectual inferiority.

So there are factors there you have to consider.