Choosing variable vs. fixed tuition rates at A&M

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12Power
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7:42p, 3/29/23
I would greatly appreciate the thoughts of any of you financial forecasters / economy experts or current Aggie student parents help determine the tuition route that would be the better choice for the next 4 years? We have to choose soon and would be stuck the next 4 years. The recent state legislation that would allegedly help prevent A&M avoid rate hikes for the next 2 years may give a false sense of security. Also hoping for new POTUS in 2. Thank you.

PS: If this is the wrong forum then delete and ban user.
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197361936
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8:09p, 3/29/23
Contact the department advisor for your kid, or the tamu financial center to discuss the pros/cons of each. I'm always skeptical of any form of variable rate, as they're sweet in the short term, but often hurt in the long term ex:adjustable rate mortgages. If college attendance decreases, I'm assuming tuition increases so understanding enrollment trends would be useful if deciding on an ARM.

Fixed always seems to be the responsible approach imo.

"fixed means that they make an estimate of what the final cost of your attendance over the whole time will be, accounting for tuition increases, and divide it by 4, and charge you that per year. Variable just takes that year's tuition and charges it."

https://talk.collegeconfidential.com/t/fixed-vs-variable-rate-for-tuition/1915143/2
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PeekingDuck
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8:23p, 3/29/23
AG
The risk is always inherently baked in due to the large nature of the program. Make a coin flip and pick a direction.
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BearJew13
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In reply to 197361936 • 10:52p, 3/29/23
AG
It always seems to be the responsible approach, but that doesn't actually bear out, historically.
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LOYAL AG
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7:11a, 3/30/23
AG
Our daughter is about to graduate from tu. We chose the four year fixed tuition but I haven't tracked it. When we made the decision the rate was what I figured the variable cost would be for her sophomore year so getting four years at the price of year two seemed like a good decision. She's graduating a year early so we probably haven't benefited much if at all.

I will say that at the beginning of this semester she was notified she needed to see if she qualified for a rebate program. The qualifications were being in the fixed tuition program, graduating in four years or less and taking no less than 3 hours that didn't count towards her degree. She has applied for it but no results yet. Its like $3500 which is 1/3 of a semester so not a small number.
The federal government was never meant to be this powerful.
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Bird Poo
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10:30a, 3/30/23
AG
With our property tax soaring, tuition shouldn't soar either.
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Howdy Dammit
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In reply to LOYAL AG • 11:19a, 3/30/23
AG
LOYAL AG said:
Our daughter is about to graduate from tu.

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BTHOtrolls
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In reply to Howdy Dammit • 5:40p, 3/30/23
AG
Howdy Dammit said:
LOYAL AG said:
Our daughter is about to graduate from tu.

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LOYAL AG
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In reply to Howdy Dammit • 6:05p, 3/30/23
AG
Howdy Dammit said:
LOYAL AG said:
Our daughter is about to graduate from tu.

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Oh trust me I know. We've been laughing at that since she got admitted. Reality is she's a Film Major and we have nothing at all for her. She applied to UCLA, USC and tu. A&M doesn't exist in that space.
The federal government was never meant to be this powerful.
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BenTheGoodAg
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In reply to 197361936 • 6:10p, 3/30/23
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Pluralizes Everythings said:
If college attendance decreases, I'm assuming tuition increases so understanding enrollment trends would be useful if deciding on an ARM.
I agree with your broader perspective, but I don't understand this point. Would be interested in your take, here.

Attendance has seemingly exploded at A&M and tuition rates have grown with them, right? I haven't followed the last couple of years, but this has been true for decades.

At the end of the day, it sure seems like the biggest factor in tuition cost is that the universities aren't taking any measures to save money, at all. Everything continues to be bigger, better equipped, and exponentially more expensive than what came before it. I guess elements of this are natural, but it has seemingly outpaced other industries. The amount of wealth in and around the university is mind-blowing compared to when I was a student. Until this changes, I don't see tuition rates slowing their growth.
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197361936
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In reply to BenTheGoodAg • 6:36p, 3/30/23
BenTheGoodAg said:
Pluralizes Everythings said:
If college attendance decreases, I'm assuming tuition increases so understanding enrollment trends would be useful if deciding on an ARM.
I agree with your broader perspective, but I don't understand this point. Would be interested in your take, here.

Attendance has seemingly exploded at A&M and tuition rates have grown with them, right? I haven't followed the last couple of years, but this has been true for decades.

At the end of the day, it sure seems like the biggest factor in tuition cost is that the universities aren't taking any measures to save money, at all. Everything continues to be bigger, better equipped, and exponentially more expensive than what came before it. I guess elements of this are natural, but it has seemingly outpaced other industries. The amount of wealth in and around the university is mind-blowing compared to when I was a student. Until this changes, I don't see tuition rates slowing their growth.


That's only my opinion. I don't think college attendance is going down right now, and I'm waiting to see what the end result is going to be for students with debt.

The conventional wisdom I hear from my peers is that college just isn't worth it. I run into subcontractors all the time on the job, many of which are in their 30's and have their own business. They're much better off than kids who went to college, learned little, and are saddled with debt. Who knows what the future holds, but I could see a shift away from college attendance depending on where the money really is (college vs. alternatives) - whichever direction people migrate in should let us know.
Anyone who chooses to ride a bicycle in the street is a threat to themselves, and others. If a vehicle strikes you accidentally, YOU are at fault; and the laws of physics supercede all else when you're in the path of a 2 ton killing machine. Know your place, stay off the road.
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BenTheGoodAg
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In reply to 197361936 • 6:40p, 3/30/23
AG
Thanks
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Aggie_Boomin 21
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6:45p, 3/30/23
AG
What's the difference between them cost wise year 1?

Does tuition ever decrease year over year at public universities?
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Comeby!
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9:06p, 3/30/23
AG
I can't remember off the time of my head which way we went with my son 2 years ago (I think fixed), but I built a spreadsheet and calculated the assumed annual increase. I think it was just under 3%. With inflation that hasn't hit at the time, I would imagine that fixed was the right call.
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txaggieacct85
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In reply to 12Power • 10:26a, 4/3/23
AG
12Power said:
I would greatly appreciate the thoughts of any of you financial forecasters / economy experts or current Aggie student parents help determine the tuition route that would be the better choice for the next 4 years? We have to choose soon and would be stuck the next 4 years. The recent state legislation that would allegedly help prevent A&M avoid rate hikes for the next 2 years may give a false sense of security. Also hoping for new POTUS in 2. Thank you.

PS: If this is the wrong forum then delete and ban user.
fixed. I had three kids go through A&M and a fourth current student.
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txaggieacct85
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In reply to BearJew13 • 10:27a, 4/3/23
AG
BearJew13 said:
It always seems to be the responsible approach, but that doesn't actually bear out, historically.
I did the math on this for four kids and fixed is better.
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BearJew13
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In reply to txaggieacct85 • 7:48p, 4/3/23
AG
I'm sure your math is right, but what were your assumptions?
There is a price to de-risking price fluctuations, and rarely does that price come out ahead of what the true cost would be.

You're basically buying insurance, underwritten by the university. They aren't incentivized to provide that at a loss. From a risk-adjusted standpoint, it may be worth it to you. In certain instances, yes, it may come out ahead, especially in inflationary environments. However, the concept of fixed being more expensive than variable cost, over time, is not debatable.
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Comeby!
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In reply to BearJew13 • 9:37p, 4/3/23
AG
I know you didn't ask me but what I did was calculate what annual YOY rate increase were they using then taking 3% off of that (CPI, was valid at the time) how much fluff was baked into A&M fixed rate. I felt that tuition would go up more than what they were representing. Turns out inflation hit much much harder than that so fixed was the right call for us.
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chris1515
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7:57a, 4/4/23
AG
I'd bet some financial analyst at the university crunched the numbers, and based on the best information available at the time the two choices are more or less equal.
If one turns out to be better, that'll mean some assumption didn't go the way they expected.
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LOYAL AG
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8:30a, 8/11/23
AG
Bumping this thread for something really interesting we learned after the thread died. Quick reminder my daughter just graduated in May from tu and we had her on the fixed tuition plan. Sometime in April she got an email from tu saying that because she was in the fixed tuition, graduated on time and didn't waste more than three hours she may qualify for one or both of two grants. Long story short she applied and got both resulting in a $3500 refund to us. I don't know if that exists at other schools but it's worth looking into and definitely a positive for fixed tuition.
The federal government was never meant to be this powerful.
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topher06
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In reply to Bird Poo • 2:42p, 8/11/23
LOL at thinking our property taxes would be used for someone going to college. Too many other things to waste those on.
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