Filed under: Life Stage LessonsEvery one of us has had "aha! moments." Epiphanies. Days when we reach a crossroads and realize that we have to make some changes. For the next two months, we're sharing moments like those in our Life Stage Lessons series: Real stories straight from the financial lives of our DailyFinance contributors about times when they realized they were due for a serious course correction. So read on, learn from our mistakes, and get inspired to improve your relationship with your money.
We all have different reasons behind why we pick the colleges we attend. My reasons came down to a surprise party and roll of Bubble Tape gum.
The weekend before my ninth birthday, my Dad seemed anxious to get me out of the house. "Let's go to Media Play," he proposed. The now-defunct retail store used to be my favorite place to peruse cassette tapes, and later CDs.
An hour later we were in the checkout line, and I eyed a roll of grape-flavored Bubble Tape gum (a treat that, like those CDs, is less popular now than it was back then). "Dad, can I have that Bubble Tape?" I asked.
"Sure," he said and casually threw the gum atop a movie he planned to purchase.
Something Is Wrong Here
To a casual onlooker, this would seem like a typical father-daughter exchange. But that "sure" set a siren off in my head. My parents never just outright bought me anything, except for presents on my birthday and Christmas. My sister and I had to put up a 50 percent stake in any item we wanted. Few things teach a kid how to curb impulse spending like insisting she pays half for the stuffed animal she wants.
The fact my father would just buy the Bubble Tape without asking for that 50 percent meant something was amiss. I wracked my brain on the drive home wondering what could cause his sudden willingness to abandon a core value.
When we arrived at home, a surprise birthday party awaited, which explained my Dad's distraction. In that pre-cell-phone era, he was trying to finesse getting me back to the house at the right time, but without letting me see 25 kids sneaking in the door.
An Entitled Perspective in High School
Fast-forward nearly a decade later, and the family deal of paying for 50 percent impacted one of the biggest decisions of my young life.
I had barely paid attention to price tags during my college application process. My high school career was spent in top-notch international schools where the annual tuition cost about as much as many liberal arts colleges in the United States. I'd been afforded this opportunity by my father's career, which turned our family into expatriates only a year after that surprise birthday party. In his industry, covering the kids' fees at these elite schools was often bundled into the expat compensation package.
Unfortunately, these schools also tend to breed an unrealistic vision of finances.
Tuition? It's Just a Number
When you attend a high school where the general collegiate philosophy of many students (and their parents) is "Ivy League or bust," it should come as no surprise that tuition prices rarely come up in the "Where are you going?" discussion.
While the Ivies were not in my cross-hairs, I sent in applications to many elite liberal arts colleges on the Eastern seaboard, most with asininely high tuition. My obligatory "safety school" was a not-so-cheap small liberal arts college in western New York.
Many months later, after the acceptance letters arrived, my father called a meeting. He sat across from me at our slightly imposing dining room table and slid two pieces of paper across the table.
College A or College B?
The first one depicted my future debt burden if I were to pick College A (where I was already planning to send in a seat deposit). The second showed the my costs if I attended College B (that safety school), where I had an offer for an academic scholarship covering half of my tuition.
While my father and mother were financially capable of sending me to either without taking out loans, raiding their retirement accounts, or crippling the family finances, my father didn't see the value in paying College A's hefty price tag for my intended course of study (theater and journalism).
As I examined the pages, I quickly noticed something peculiar: If I picked College A, I'd be responsible for paying 50 percent of my college tuition. If I selected College B, my 50 percent was represented by those scholarships: I'd graduate debt-free.
Anger Finally Yields to Understanding
Should I have been surprised? No. My entire financial education had been leading toward this moment. But the mind of a 17-year-old girl is not always the most rational.
Appreciation for the fact my parents were willing to pay for half of my college education was not the emotion that registered. Instead, I grew angry at their refusal to cover all the costs at any college I planned to attend. The trite retort "All my friends' and classmates' parents are paying for their colleges" may have even slipped out. Not the strongest argument.
After some less-than-satisfying door slamming and dramatic calls to my inner circle of friends, I calmed down enough to look at my choices rationally.
My parents were offering me a gift: a debt-free college education -- assuming I kept up with my studies and maintained my scholarship all four years. It was up to me to decide if I wanted to graduate debt-free or pay the high price of attending a school that would look fancier on a résumé.
Return on Investment
All those years of paying 50 percent for what I wanted taught me to evaluate purchases, ponder the potential return on investment, and curb impulse spending. And that led me to decide it made more sense to graduate debt-free than shackled with upwards of $80,000 of debt.
Three-and-a-half years after graduating college, I don't regret my decision. The smaller school gave me opportunities to stand out and flourish. The tight-knit network afforded me opportunities to work with big-name news organizations and find a job in entertainment just two weeks after receiving my diploma. Best of all, I graduated with a positive net worth and never felt stressed about money -- even when I only earned about $20,000 during my first year living in New York City.
Erin Lowry writes for DailyFinance on issues relating to millennials, money and personal finance. She is the blogger behind Broke Millennial, where her sarcastic sense of humor entertains and educates her peers. She is also the brand and content manager for MagnifyMoney.