Make Smarter Decisions

Maximize satisfaction. Minimize regrets.

Making Assumptions Can Cost You Thousands of Dollars When It Comes To College

by 28 Comments

Earlier this summer I shared with you that we would working to make smart decisions about colleges for both of the kids! With one finishing an undergraduate degree and the other finishing high school next spring, the fall of 2017 will leave us as empty nesters!

In Choosing the Best College, I shared with you how some things have changed since I searched for a good college back in the 1980’s. But from my own experience as an advanced graduate student and in my experience teaching at the college level, good doesn’t seem to be good enough for many people. There is a big emphasis on kids choosing the best college, sometimes without enough regard to the costs to both the student and the family.

In the follow-up to that post, I talked about managing the information overload from colleges to choose the right college – not necessarily the “best” one. I also shared my daughter’s ranked list of goals for choosing a graduate degree program. The decision matrix we created was included to help show you how we compared the options she was considering.

Two months into the college search, we have found two major flaws in our thinking. And each of them could have turned out to be VERY EXPENSIVE. What it comes down to is a couple of assumptions we made.

Assumption #1 – Don’t consider out of state public colleges because they charge crazy high tuitions.

At my daughter’s state college this year, the in-state tuition is about $7,000 and the out-of-state tuition is $16,500. It’s $9,500 a year more if you are from out-of-state. This state college offers VERY few scholarships and it is difficult to get in because of the great reputation and “reasonable” price. (OK – I get that it doesn’t seem reasonable to many – but when you compare it, it is still much less expensive than many schools).

We would be looking at my son attending a similar state college, but he wants to go to school further away. And back to assumption #1 and the crazy high tuition - when you look it up, you would certainly see what most people are talking about.

For example, West Virginia University’s in-state tuition is about $8000/year and the out-of-state is $22,500 – WHOA! A $14, 500 difference because we live in NY.

BUT… WVU offers merit scholarships! Right now my son is eligible for a Scholarship Distinction Level 2 award of $8,000/year. That brings the cost of tuition down to $14,500. That’s getting better, but if he can score one more point on his ACT’s he can be a Level 1 Scholar for an award of $14,000/year. That brings the tuition down to $8,500. It is still about $1,500 higher than our own state school but there is still more to it.

It’s important to use a tool that all colleges are required to have – a net price calculator. This is how my son found out that WVU offers merit scholarships. Keep in mind that the net price calculator may not be totally accurate either – but it is a rough estimate that gives you more information than just looking at all of the fees separately.

When we did the net price calculator for a year at WVU (which includes tuition, fees, and standard housing, meal plan, books & travel) it was $33,600. And when the $14,000 scholarship was deducted, the cost was estimated to be $19,600/year.

When we did the net price calculator for the in-state school my daughter attends, with all of the same costs from above – the estimate was $22,200/year.

Based on these rough estimates, my son could save over $2500 his freshman year by going out-of-state to a school he wanted to go to…

And he is certainly motivated to take his ACT’s over again to score one more point to earn the $14,000/year scholarship rather than the $8000 one!

He even said – that could be a $18,000 savings from one point! ($6000/year x 3 years – he plans to finish in 3 years, the same as his sister - because of all the AP/Community College credits they earned in high school). So nice to see some early financial literacy from a 17-year-old!

Lesson #1 – Don’t just listen to what other people say. What they tell you or what you “hear” is simply information and don’t assume it’s 100% correct. Do your own research too. And if you are looking at colleges, use the net price calculator and search for merit (or other) scholarships that might be available. Out-of-state may be cheaper than in-state and it will be a win-win for both of you!

folded-map-1414528-1279x850

Assumption #2 – Well that college is just too far from home.

When beginning to consider possible graduate schools for my daughter, we started by looking at schools with accredited programs.

The goals she developed helped to narrow the list of colleges. One of the goals was “reasonable” driving distance from home. We made a list of the schools that seemed reasonable (about 5 hours or less) and did research, followed by some college visits as described in this post. She settled on two options after the visits and we thought our search was likely over.

But when my son visited WVU with his dad, they came back and asked why my daughter hadn’t considered it for grad school. (They happened to go through the department she would be in on the campus tour).

I’m pretty embarrassed to admit it, but when we looked at the accredited list - we totally skipped WVU. West Virginia just seemed like it was way further away than it actually is… but it is only a half hour further than one of the colleges we visited.

So why does it matter? My daughter is really interested in the graduate program at Penn State, but the tuition for the program at WVU is about $22,000 less. And WVU just added a PhD program that she may eventually be interested in. She decided to go visit and after they reviewed her grades and GRE scores, she is likely to get an offer for a large merit scholarship to cover tuition (and more) or a graduate teaching assistant role that could pay her full tuition and provide a stipend.

Penn State has a few opportunities to reduce tuition too, but at our tour – the department chair shared that they are very competitive.

There is a chance that our bad assumption could have cost my daughter (and us) up to $90,000 in a worst case scenario. If she ended up at Penn State with no financial assistance and could have had full tuition and stipends at WVU – the $90,000 difference could have been a reality with all expenses added in. It wasn’t likely to be that high – but it could have been. And that’s just scary to consider.

We won’t know what is going to happen with her graduate work until early 2017 when she applies, is accepted and receives offers (hopefully!) from the colleges. But the “distance from home” assumption was a huge lesson for our family. She’ll likely seriously consider WVU even though it is further away - for just the $22,000 difference in tuition if she gets no aid from either school.

Lesson #2 – Our assumptions limited our options. It’s worth it to spend a few extra hours to really investigate things that matter (and cost) this much! Three or four hours, google maps, and a spreadsheet could have helped us to document important information on all of the accredited schools for the program she wants. Saving $22,000 (or much more) for four hours of research – is more than $5000/hour for that extra effort!

Luckily these were things we learned before we made a bad decision for either child and that’s why I wanted to share them. Can you think of anything you assumed that could have cost you tens of thousands of dollars in terms of college? Or even costly assumptions about other topics? Let’s help each other out!

Calculator & Map Photo Credit: PaulaPatracinio and YaroslavB at freeimages.net

When DIY Might Not Be the Smartest Decision!

by 40 Comments

sign-1573405_1280

When I started this post the original title was “Hiring Out Your Pool Maintenance? Why DIY is definitely a Smarter Decision!” If you read the title carefully – you’ll see that I’ve changed my mind a bit on this now! And this change of heart has only happened because I am consciously trying to be careful to recognize my biases. And although this example is about pools, it can be transferred to other DIY projects too!

I have always been around people who are pretty self-sufficient. My parents had rental properties from the time I was very young and up until the last few years, they always managed the units and performed the majority of the maintenance. Even though the DIY “label” was not around back then, clearly the role models I had were hard working parents who figured out what they didn’t know how to do – without the help of the Internet or YouTube.

I’m sure most of their DIY efforts were to save money, but they also learned a tremendous amount along the way. My siblings and I also own rental properties and with a few exceptions, we have followed in their path by completing much of the property upkeep and maintenance on our own. (My husband gets the HUGE majority of credit on the upkeep of our properties though!)

But in an effort to try to always keep learning and to look at decision-making in a broader sense, I have identified my own clear bias toward DIY. And as I started outlining the original post, my bias became evident when I didn’t even have prices of hiring out pool maintenance to back up the title!

But the cost of hiring someone to maintain your pool must be incredibly high – right? Pool companies need to make money while they can, especially in an area where the season is so short. I didn’t think there was any way that a pool company could be less expensive than DIY pool maintenance. And I was right – but I still changed the title of the post. Let’s look into this a little more…

We have gone to a local pool company a few times to get supplies or parts when we don’t have time to order them. The owners are great to work with and based on conversations with others and reviews online, the company has a very good reputation. I called them and asked questions about the costs related to opening/closing and maintaining an in-ground pool for our typical season (Memorial Day-Labor Day).

The numbers were “ballpark” figures – but that was all I needed to make some comparisons to our DIY pool maintenance costs. Here is the breakdown of costs if we would hire out the maintenance:

WP_20160418_15_57_06_Pro (1)

1) Opening/Closing (includes chemicals and sand for filter) - $500 *this is specific to our winter safety pool cover (the one on ads that holds up an elephant – it’s pretty amazing!)

2) Weekly pool vacuuming & addition of chemicals/balancing of chemicals - $60/week + cost of chemicals. We estimate about 15 weeks of use. 15 x $60 = $900 and the pool store owner estimated the cost of chemicals to be approximately $500 for the season.

With tax and some rounding up (always round up!) – we can estimate a minimum of $2000 for pool maintenance for the season (or about $133/week…)

This does not include any problems with the pool – (such as pump or pool liner issues), and it doesn’t include water or electricity costs either. This is just the basic pool maintenance. (In an upcoming post, I will detail more of the costs related to our pool to give you a better sense of total actual costs.)

So how much does it cost us for our DIY pool maintenance? We estimate the cost of the chemicals, chemical testing kit, and sand for the filter for the year to be between $550-600 (and we always estimate high!) We don’t have any costs for opening and closing – other than the time it takes us to do the work involved. And it takes about 12-14 hours of work total to open and close the pool (including the initial vacuuming/skimming and setting up/taking apart the filter). We should also include the time it takes my husband to vacuum each week and for me to do the chemical testing. This would be about 1 hour a week or 15 total hours.

But my husband is retired (other than taking care of our rental properties) and I only work part-time for the most part now. Does that affect what our time is worth?

Let’s just use a value of $25/hour for this example. With 29 total hours of pool maintenance x $25/hour= $725 “labor cost” to DIY pool maintenance.

So the total cost for DIY pool maintenance if we round up (and include our “labor” costs) would be about $1,325. This is a $675 savings per season over hiring the job out. And without considering the value of our time, the maintenance costs would be about $600. This would result in an annual savings of about $1400.

What do you think? Is it worth saving $45-90 per week ($600-$1400 total depending on how you look at it) to have to do all the work yourself?

Only you could decide that answer!

Some people would hate spending that much extra money each week for a job they think they could do (or learn to do) themselves.

But since I’ve been back working a temporary full-time job this week (for first time in 4 years) and my husband is busy getting apartments ready (not a passive investment at this point), we were more like a “typical” dual income family this week.

And when we thought about things like getting groceries, cooking, going to kids’ games, running errands, mowing the lawn, and trying to get in some exercise ourselves – the thought of vacuuming and maintaining the pool this week became just one more thing to fit in a busy schedule.

What we decided was that if we were working full-time all summer – it might be totally worth the money to pay someone to open, maintain, and close our pool!

And that’s when I decided to change the name of the post.

It’s also really important to point out that if you don’t really know what you are doing with a pool in terms of the chemicals and keeping it clean, you may even SAVE MONEY by hiring the job out. Pools that are not very carefully maintained can easily turn into green swamps for many reasons! (Just think about those green pools you saw in Rio during the Olympics…)

And if you have a really busy schedule, you might just end up running back and forth to the pool store to get water tested and to purchase chemicals – and all the money you “saved” from DIY might be lost (and more…) along with a lot of your precious time off!

So here are the key points and questions from this post that you should consider in terms of DIY or hiring jobs out:

  • Know your biases and be open to other options. And make some calls to cost out your options before dismissing them as “too expensive”.
  • Can you do the project safely and efficiently? (We don’t DIY most electric issues or maintenance/repair of any roof.)
  • Have clear goals. If your extremely important (EI) goal is to minimize spending, then DIY projects might make more sense. If spending time with your family is most important, then you might choose to hire jobs out.
  • Consider the time needed to learn about the job or project BEFORE you start doing it.
  • Remember that “learning as you go” can cost you both time and money!

Are you a DIY’er or do you hire a lot of jobs out? Do you use any kind of criteria to decide? Have you done DIY projects or jobs that really weren’t worth your time and effort? Would you put a dollar value on your time if you were retired? How much would your time be worth?

Photo Credit: [email protected]

What is the cost of not learning? Or not learning how to make better decisions?

by 26 Comments

price-tag-1240865-1279x768

Today’s post is going to vary a bit from my decision dilemma and decision analysis posts. We are going to be looking at the idea of “choosing not to learn” and the “costs of not learning’ (and not learning to make better decisions).

I am currently a Leadership Team member for a National Science Foundation (NSF) Grant. The grant aims to prepare K-12 “Master Teacher Fellows” for leadership in math and science education in urban settings. Today, I participated in the first of a two-day workshop for the NSF grant on developing leadership identities. I was excited to be a learner today (rather than a presenter), even though I have a doctorate in Educational Leadership and have experience with this topic.

The workshop presenter is Lucy West, a nationally known speaker on instructional practices, content-focused coaching, and leadership development. During a discussion about school culture and teacher self-awareness, Lucy brought up the point that all of us (not just struggling students) “choose not to learn” at points in our life. She then asked us to think about– “What is the cost of not learning?” And I quickly connected that to the work I am doing on helping people make smarter decisions.

Lucy explained how it had cost her seven years and almost $5000 choosing not to learn Tai Chi. It wasn’t that she didn’t attend Tai Chi classes in those years or that she wasn’t interested in learning Tai Chi. Lucy said that she just never practiced it outside of class or learned it well enough to do it on her own. She was exposed to it and tried it, but never really learned it.

Then it was our turn to think of something we chose not to learn. My mind immediately went to my choice not to learn how to play the piano. I took piano for six (long) years and participated in the yearly recitals. You would have thought that I would have learned how to play in that length of time – but I really didn’t. I went to my lessons and even got to the point of playing some difficult pieces, but I never actually learned how to read the bass clef (the lower notes you usually play with your left hand). I somehow figured out a way to play the notes by memory, but I never took the time to learn how to read the music.

When I thought about the “cost of not learning” to play piano, I realized this was an instrument I could have played throughout my life. I wasted a lot of time and energy (and my parents’ money) and at times I still regret the decision to quit and not actually learn it… (And yes, this may be something I put back on my “to do” list now that I have more time after Turning Down The Full-Time Job I was offered!)

So are you already thinking about a few things you have “not learned” and what some of the costs were too? I thought that might be the case!

Lucy went on to discuss school culture and the importance of the adults in the school being learners and maintaining an intellectual curiosity. She explained that the adults need to model learning and an attitude of persistence for students, and this in turn will help students see learning and their own efforts as being valuable too.

As I thought about it more throughout the day, I jotted down - Learning needs to become “What you do” and not “what you have to do”…

So, what is the “cost of not learning” for students? Well you can probably guess many of the costs. Those decisions result in a tremendous waste of time (for both the student and the teacher), money and other resources. This “not learning” can also cause anger and resentment (for both the student and teacher again), and an increasingly negative school culture.

The focus of our workshop and the NSF grant is to help “grow” teacher leaders who will positively influence school culture and use strategies to motivate students to want to learn. They will then help lead change with other teachers as well. This will hopefully reduce many of the “costs” related to student’s “not learning” over time and change the culture of the school.

So what does this have to do with you and the focus of this blog?

I am hoping that as I can play the role of “teacher leader” in terms of reducing your “costs of not learning” how to make better decisions in the past! I also hope you will see the value of making a “choice to learn” more about various ways to make better decisions in the future.

The first thing I’d like you to consider is Lucy’s original question. The “costs of not learning” to make better decisions are similar to the costs of students choosing to “not learn” in school. They may result in problems related to:

  • Personal growth and development
  • Building or maintain relationships
  • Financial struggles
  • Social or emotional challenges

And probably a lot more…

So why can’t we all just learn to make better decisions?

Here are just a few of the Obstacles to Learning that we discussed with Lucy today. They apply to decision-making as well and they may play a role in your “choosing not to learn”.

  • Being blind to your biases (or not knowing what you don’t know!)
  • Needing to look good (not appear incompetent, back your prior decisions)
  • Not allowing others to teach you anything (you already know it, have experience)
  • Thinking you have to do it by yourself (or not knowing when/how to seek help)
  • And probably the biggest one - Not having time…

Is there anything we do about it?

Well sure, if you are willing to put in some effort! These are a few ideas we discussed related to the Self-Management of Learning. It was suggested to have students choose one or two things to focus on and then add new ideas as time goes on.

  • Figure out what you are having trouble with and be strategic as to how you will address specific issues
  • Pace yourself
  • Hold yourself accountable to high standards of understanding (and ask for help when needed)
  • Control the conditions of your learning – know what works for you
  • Participate actively and collaboratively – help others understand
  • Work productively without distractions for sustained periods of time*

(*OK – that last one is a real challenge and something I have to make plans to do more often. I know it will help my learning!)

I am looking forward to tomorrow and another day of making the choice to learn! It won’t cost me anything.

Is there anything you have “chosen not to learn” and was there any “cost” involved? What are some other costs that might be involved if people choose not to learn how to make better decisions? Can you think of other obstacles to learning? Or ways to self-manage the learning?

 

Photo credit: [email protected]

Obstacles to Learning Ideas - adapted from talk given by Julia Olalla, Newfield Network

Self-Management in Learning Ideas -adapted from Resnik & Hall, Principles of Learning for Effort Based Education