High time for another series (because those have been so successful for us…), I think.
in which we pose an unthinkable question relating to the 20-nothing life then imagine how it would unfold if it came true.
(The “we” part happens when you submit comments)
Post #1: What if no one’s parents paid for anything after college?
If you’re thinking – “that was my situation, and wake up, it’s most people’s” – good for you (and I mean that sincerely), but you’re wrong. It’s not most people’s situation. Most people have some form of financial safety net after graduating from college – even if it’s as small as a monthly cell phone bill.
Before we begin I think it’s important to note that I had some but not lots of help after graduating from college. I was on a family cell phone plan. I was given all the furniture (in hand-me-downs and new purchases) that I needed to set up apartment shop. I had an emergency family credit card that I could use for a list of emergencies that never popped up (unless we’re counting the floor-length winter puffer I purchased). I miiight have been able to ask for a small loan to start a new lease on apartment (I never had first, last, and security deposit saved) or take a trip (I put all travel on a credit card for the first three years of my adult life), but I didn’t. My point is that I had support amounting to financial gain that helped me afford a New York City life at 21-years-old on 28K a year.
I also think it’s important to note that I don’t turn my nose up at 20-something who have been “set up.” Given the incredible difficulty of starting at life in any major city on an entry level salary, I completely understand why parents think it most beneficial to the future of their children to help them financially.
Now back to the WHATIF?
First, we have to assume that more people would live home after college. They’d have to. So more young people would commute to major cities meaning public transportation would be more important meaning communities would fight to have it run better. Because you’ve got to figure if the parents who would normally be giving their kids cash had to focus their efforts elsewhere it would be on ensuring those kids have lit parking lots within safe and comfortable walking distance from the it-better-be-air-conditioned bus driving them home.
Also I’ve got to assume that if more people lived home they’d reconnect with other people living home, some of those people would fall in love slash get married and we’d have a greater influx of people living in their original hometowns. Unless we’re referring to my town in which case the influx has no room to increase.
Let’s assume some found jobs with salaries affording them the opportunity to live outside the home, say, in one of our country’s major Metropoli. Now, I think we’re clear on this, but to be sure, I’m not talking about people who make between 50+K straight out of college. That’s what many grown adults make for their entire lives. Families are sustained on those salaries. (Read: if you’re making that and still needed considerable and regular help from your family, I am now turning my nose up at you).
So these 25-50K earners would have to live in fringe neighborhoods and/or boroughs (if we’re talking Manhattan). I don’t have stats on the percentage resident by age in each of the neighborhoods of the nation’s bigger cities, but I’ve got to assume some percentage is post-grads meaning those neighborhoods would see a reduction on renters. Without any statistics and damn-near zero math skills I can tell you that Manhattan’s Murray Hill would cease to exist (I can say that. I lived there). So maybe we’d see rents come down city-wide? Or maybe gentrification slash yuppy-ization would be slower? different? somewhere else?
And what about those salaries themselves? What if the first two people an employer offered a starting salary of 28K, no benefits said, “sorry, I cannot afford to accept this job.” What about the first ten. Magazines are infamous for paying their editorial assistants bare bones salaries. Wouldn’t it be fascinating to see the top ten hires in their resume file and get the chance to ask all ten if they will be receiving some help from their parents in order to be able to take the job and live comfortably? Is it remotely possible that if enough of the talented post-grad work force turned down job opportunities with salaries too low to live on that companies would have to increase their offers? Or would it just become a battle of who was willing to go into more credit card debt…
Would their be more credit card debt or just less shopping and drinking? And if there started to be less shopping and drinking would restaurants and stores charge less? Would everyone have more second jobs in places like restaurants and retail store leaving less time for the pursuit of hobbies and side projects and start-up companies? Definitely less time for drinking? meaning less hooking up? meaning more traditional dating??
If absolutely nobody’s parents paid for absolutely anything – would it be like the 50’s? Or the 60’s? Would we all mature faster and marry earlier and have bigger families and pull ourselves up by our bootstraps? And if that happened would we all end up like that tragic couple in REVOLUTIONARY ROAD?
It’s crazy to think about because it will never be true. America is too wonderfully huge, ” democratic and ” capitalistic for a trend like that to ever take hold (or be forced). But you have to admit how titillating (real word) it is to wonder, what if?…
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i am 23 years old and my parents paid for university and then that was it. i have bought my own car, pay for my insurance, have paid for my cellphone since i was 16, i have been working since i was 16. I have my own visa’s and when i did go to university i paid for the books/parking ect. this has all caused me to be in some major debt ill tell you that because i dont make that much. i work a great job and all but in the end you need experience and at my age… ive got like 3 years in my field and that was part time work for three years.
I did have to work two jobs and go to school in order to get that damn car though.. but you know what shes my baby and shhe was so worth it!!!
i dont plan on getting married earlier and im still pretty immature. And the debt will probably stop me from moving out when im suppose to be moving out… according to my parents it should be at 24 (a year) and if not i need to start contributing to the family with grocery’s or making dinners, or paying some rent.
Now they do this out of love and you know what i am soo happy they did, but i pretty much live the exact same way that my other friends do, except in knock off designer clothes instead of the real thing 🙂
This is a very intersting scenario, and one I find so interesting because I will be graduating college in just one more semester (and thusly have no clue where my life is going). I think it would be a wonderful experiment though.
“Unless we’re referring to my town in which case the influx has no room to increase.”
That’s perfectly put, Jessie. And hilarious. Great post.
Love this post! It certainly makes a person think. I myself didn’t have my education paid for, had to go out of town to school for 4.5 years. Parents paid for nothing. Started out life with over 100K in debt! I am thankful that I know what it is to earn a dollar, and now in my 30s married with a child. I’ll tell you one thing though. My daughter will not start out life with debt. That is a promise my hubby and I made. She will know what it is like to earn a dollar and will work pt time. But I’d rather get back into debt than have her struggle the way I did.
I am now 33, my parents couldn’t afford college, so I worked hard in school to get a scholarship. I had 1-2 jobs at all times starting from the age of 15 to save enough money for food, etc while in college. My parents handed down a car to me, which came with monthly car payments to my dad. After college, I moved in with a roommate and we had nothing but 1 been bag chair and some clothes. I bought everything I had off of working 1 FT plus 1 PT job both paying in the $6 per hour range. I lived in an apartment where the rent was $300 per month and could not afford that without a roommate.
I am now one of those people making in excess of $50,000…my parents have never given me anything for free – not even a cell phone. I have purchased three cars from my father all with monthly payments. I have completely furnished my own home, paid for my vacations, etc….
I find it hard to believe that “most” people are somehow set up by their parents after college. Maybe that is the way it is done in NY because the costs of living are so high. That’s not the life most of my friends lived at that age.
It is totally possible to 1. not continue to live in your hometown, 2. have food and shelter without the financial support of your family. All you have to do is suck it up and work hard for what you want.
Very interesting post. Not only did my parents not pay for anything after college, but they also didn’t pay for college, leaving me with loans upwards of 30K. I think that even if all parents paid for their children’s school and college experience (books, clothes, food, rent, etc…) and then stopped after college leaving their children with NO debt whatsoever, then things would be very different.
I have been financially on my own since I was 19 years old. My parents paying for anything is a foreign concept. I worked full time through college and got a full time job right out of college.
Was it hard? Yes. Do I think I’m better off than most people my age? Absolutely. People set up by their folks are spoiled brats for the most part who cannot commit to anything.
I have also been on my own financially since I was 17 and have worked since I was 13. I helped my mom pay for appliances while still in high school and worked to put myself through college with a full time job most people would consider a career.
I took an unpaid internship that I had to save up for from my own money for an entire semester which eventually afforded me the opportunity to work where I do right out of college. (trust me college age student, the internship is your foot in the door and worth the financial sacrifice!)
I have always paid for vacations with my own credit cards, traveled to visit family on my own dime, and am currently bailing out my father who is currently unemployed…
As I have to say is, I want to know what world this poster lives in because I will buy a ticket tomorrow 🙂
Tent towns. I think there would be loads of tenement-style post-college Hoovervilles. Places where those not ready to buy into the big system would go, and live a sort of 70s commune type of living.
I’m not even going to say this would be the way the majority of kids would go, but I think you’d see more of the art school sect head this way, especially from smaller schools. Without the previous generation to help us, I’d like to think at least some would lean on each other.
Fascinating what if. Part of the answer is, it would not be like the 50s and 60s – society/economy has changed too much (unless the “what if” did ultimately raise salary levels). Our parents graduated college, or even high school, and were able to find a job that supported a family, gave good benefits, etc (and often this was one job per couple that supported the family). Those jobs, those benefits, etc don’t exist anymore.
One issue, though – this is very city-centric. Lots of twenty-somethings don’t live in the cities.
Okay, one more – most people I know whose parents cut them off at college, would not allow them to move home, either. (Not in a harsh, mean way – but that would be considered support, whereas the adult child was supposed to be supporting him/herself). So that totally changes some of your possible scenarios. Moving home is the biggest safety net of all (well, except trust funds…).
PS – I also think it’s interesting that all the comments are coming from people whose parents have not helped them. I wonder if there’s any significance there.
I think the significance of those commenting who have not had the support of their parents is that they are proud of what they’ve accomplished through hard work. Even though that “pulling yourself up by your bootstraps” thing may feel outdated, we (at least as Americans) still value someone who does it. And we take pride in ourselves for accomplishing such a feat.
And in regard to everyone not having their parents’ support post-college, I think there’d be a lot more credit card debt, not more budgeting and scrimping.
Good way to make us think. I did have my college paid for–the deal was that if I want to a NY state school, it was taken care of. Anything over the 4 yrs or out of state was my responsibility. I appreciated that. I also graduated making a lot of money and within a month or two was asked to pay rent, which I think was very fair. Then I went to grad school, took out $20+ of loans and started over in an industry that tops out at what I started out in my first job. And now Im wading through debt. It sucks. The only thing my parents pay for (I dont live home) is my car insurance and that is because I share a car with my dad. They pay insurance, I pay the pymts for the 2001 station car.
I didn’t think myself spoiled bec I grew up among Long Islanders whose parents bought them brand new cars when they turned 16 and sent them to expensive private schools. But now, having grown up and recognized the influence my parents paying for what they did have, I wish they hadn’t. I am used to a lifestyle that I really cant afford. And my parents have always depended on their CCs, therefore not discouraging us from doing the same… and I sure wish I didn’t have any.
I now watch my younger brothers enter and leave college and realize even more how spoiled we were. One doesnt really realize what things cost and has come to expect things. The other is now applying to grad school and on his own financially and recognizes it. I think we’d have all been better off if my parents paid for less and didn’t give us such extravagant gifts.
I was always thankful but now that I’m an adult and on my own, I recognize how far money goes… I feel not only very appreciative, but somewhat guilty… and wish it had been the other way around.
It’s an interesting thought but done with blinders on. Consider the parental side of the equation (and 33 year old CanadianBloggerGirl suggested it), college comes with debt. It might not be yours but someone has to put up the cash. Sure, some folks are able to sock away $100k for the kid’s education in the eighteen years leading up to it (the most expensive 18 yrs) but the vast majority of us will either try to save for it (and go into debt in the attempt) or simply borrow the money for you (going into debt). No one gets away unscathed but the child who finishes school without the cost hanging over their head.
Consider the gamble: parents save from day one or invest in growing a college ready child – either way, its a sacrifice they are willing to make. They do this knowing that only 33% of the time, a student graduating high school will actually go on. Then, the stats get even scarier. Only one in five graduate from a two year school; two in five finish in six years from a four year college.
And then what? You still fail to launch, all the while you live at home, work and buy yourself stuff to help you get out.
Parents subsidize and we do so without any expectations that we will get paid back. Or even thanked. Moving out is nice but coming back, not so much. So we want you to be able to cut the tether, visit, call once a week and live on your own. Not in a tent city as someone suggested – we’d worry. It’s what we do. But a practical, calculated and well-thought out exit with a strategy would be nice.
Some of your commenters suggested that they paid for everything or that their parents never paid for anything misses tallying the first and most expensive years of their lives. After the first seventeen years, they may not have been able to.
Your parents and their debt may however have been used on your financial aid forms and/or unwittingly positioned themselves in such financial dire straights as to be unable to help which ironically, probably helped.
But there was debt and a lot of it somewhere. All we have to do is look for it. Your parents might not be forthcoming about it but ask them about the mortgage, their retirement, their savings and you will get an indication of some lingering costs associated with raising a child, sending them to college and having them move home afterwards.
Jesse, My comment was too long (according to the blog limits) so it ended up as a blog post of my own.
Thanks for the inspiration to address something I’d been meaning to get around to eventually, after I was done trying to save your parent’s retirement and get you to save your own.
http://target2025.com/retirement-college-investing/
Thanks again and keep up the good work – You did good on Suze Orman’s show!
Paul Petillo
Managing Editor/Target2025.com