financial risks

Brad Baldridge
Today we cover college testing and "Is college worth it?'

Presenter
You have kids, they grow up, and before you know it, it's time to plan for college. Where do you start? How much is it going to cost? Will you qualify for financial aid? Should you be looking into scholarships? When will you be able to retire? What about student loans? The list of questions is never-ending. The good news is all the answers are right here. Welcome to the Taming the High Cost of College Podcast. Here is your host, certified financial planner, Brad Baldridge.

Brad Baldridge
Hello, and welcome to Taming the High Cost of College. I'm your host, Brad Baldridge. Today, we have a great interview with Mike Flynn, we're gonna delve into whether or not college is worth it in the second half. And then right out of the gates, we talked quite a bit about testing and test optional and how the landscape has changed around that as well. We got a lot of great information. As always, we've got show notes available tamingthehighcostofcollege/147. So you can get more information there. And then of course, we then roll into Brad Recommends where I talked about some books by Cal Newport. That's all we have for now. So let's go ahead and jump into the interview.

Alright, today I'm sitting down with Mike Flynn. He's the owner of Engenius Learning. Welcome, Mike.

Mike Flynn
Hi, how are you?

Brad Baldridge
I am doing well. So obviously you work in the education field. Can you tell us a little bit more about what you do and why you do it?

Mike Flynn
Sure. So I own tutoring centers, right? Teaching kindergarten through college, reading, writing math. But my specialty over the last, say, 35 years, is been on getting kids to college. And that's test prep, ACT or SAT prep, and then also dealing with kids on the right college to pick, the right major, and I've learned a great deal, made a lot of mistakes, a lot of failures. And everybody every five or 10 years, the whole system changes on me and I got to come up with something new. But I think the the path that we're on right now in terms of trying to guide kids from, you know, people always ask me, 'When should you start talking, when should we start looking at college?' And the Knowledge is Power Program, which is a program that's based in, it started in Chicago, but it's inner city kids, they start talking to kids about college in fifth grade. And it's really just talking about kids about getting to college, what it means and all the possible avenues. And they have an 85% success rate of getting kids to college. And these are kids that are low socioeconomic, struggling with that aspect. And those kids get into college. So middle school, high school was when we start thinking about college, start putting you in the right position. And then obviously, when you get closer, sophomore, junior, senior year, you got to play a different game.

Brad Baldridge
Right? For sure, exactly. And that's the, as I'm sure my listeners that you've been listening a while, you know that's kind of a transition from what I call 'early stage' to 'late stage' where, again, early stages, college is going to happen someday, maybe we should prepare for a fight financially, maybe we should talk to our kids about how they're going to love college someday. But we don't have a lot of detail. We're not even positive, it's going to happen for our kids. And we don't necessarily know when we get there. Once you have a kid in high school, now, whether you've done a great job early stage or not, now it's really go time. Now it's visits, and choosing a school and figuring out the finances and applying for admission applying for aid. There's a lot more to do. Again, even if you've done a great job prepping, you still got to execute at that final stage. So

Mike Flynn
Yeah, and you're 100% correct, right, that early stage, I probably steal that from you, thank you. But that concept of is the perfect way to approach it. And then what I think that you need to do is you need to arm yourself with some good information. And one of these early stage conversations taken a look at the importance of middle school for the success rate of getting to college and being successful in college, right? It's one thing to get to college, but I need to get you through college, right? That's maybe the push that I take

Brad Baldridge
Right.

Mike Flynn
And there's an older study done by the ACT called The Forgotten Middle. And it showed that success in middle school was actually a greater indicator of success than high school GPA, and ACT or SAT scores.

Brad Baldridge
Right.

Mike Flynn
So when I always tell all my parents in that early stage, right, borrowing your term, a we need to have a successful middle school. A lot of times the parents I deal with just, 'Listen, can we just get through 13 and 14? Can we just survive that and then we'll worry about this when we come through this scary dark period?' And it's like 'Nah, sorry, I hate to break it to you. That's the time that we really got to be focused to set yourself up for high school.'

Brad Baldridge
Right? Absolutely. So if we are, again, a lot of my listeners are probably focused on late stage, they're the ones that are searching us out and trying to figure it out. And they've got a limited time. So because you're involved in the testing and the test prep, can you give us a little quick update on what's been going on? I mean, it's certainly been in the news. But for most parents, that's something that's 'not their news.' They're not getting the newsletter from ACT or whatever. So, I guess there's a couple things going on. What is this test optional? Where do you see that going at this point? Have you, what's the latest news as far as a lot of colleges went optional, but what are they forecasting longer term? If I had a high school's freshman or sophomore, any ideas what I could expect at this point yet? Are we going back to testing, are we not?

Mike Flynn
So maybe a 30-second bit of history here, the University of California School System, UCLA, UC Berkeley, there's 10 schools, nine undergraduate, one graduate only. They're more or less the College Board maker, the SAT and the ACT, the other competitor for college entrance exams. They're the single biggest customer, right? And so whatever the UC system does, more or less, all the other colleges around the nation follow suit, because it is such a big powerful group. And the UC system has for years said, 'Hey, drop the SAT, it's biased, it's bad, etc.' And then college board goes and does whatever the UC system says. And they keep making the adjustments and just recently within the last 18 months, which is recent, and in test prep times, the Academic Senate, they're the ones that represent the professor said SAT and ACT are great. We think it helps find diamonds-in-the-rough kids that maybe had poor GPAs but great SATs. They voted 51 not in, keep the SAT. The regents who are the people that have served on the board who don't have any education, they voted say, 'Hey, SAT is gone.' So I ended up that their test blind, not looking at test scores, doesn't make any difference what you got, we don't want to look at them. Some other schools said, 'Well, I'm not quite ready to throw the test out, I want to go test optional.' Test optional is if you have scores, submit them, and we'll only use them if they look good. But if you have some really bad scores, I wouldn't recommend you submit them. So what I always tell people is find what the 50th the 75th percentile of a college you're looking at. And if you're near that 75th percentile, somewhere close and above, please submit your test scores because they could be beneficial. If you're below that, then either keep working on your test scores or don't submit as several college counselors, not counselors, but admissions officers said a bad SAT or a good SAT or the absence of a test score generally is not going to cure a lot of bills that you had from bad grades, course rigor, which is how difficult the courses are. So the tests, I don't think the tests are going to completely go away. You've got a lot of these small colleges that rely on this data. Right? Take a look at grade inflation. How do we determine from one high school in one part of the town to another that an A is an A right, so tests do help differentiate there.

Brad Baldridge
Right, I think there's a little bit of a cheat going on right now, where because there's a there's been a lot of testing, there's a lot of data or institutional knowledge where the typical college says I know that high school is stronger than that high school. And I know this high school has more grade inflation than that high school. And they can mentally correct for all the variability that's out there because they've got years of test scores and that kind of stuff. But I think if testing goes away forever, for good, it's gonna be really hard, long term for a high school then to turn it around, because they won't have any proof that they've improved or slid or whatever. Right. So I think long term, it's going to be some sort of testing or something to, again, try and level the playing field.

Mike Flynn
Yeah, and these things do follow, right, they swing on the pendulum, they go back and forth. I live in Silicon Valley, Stanford is just 45 minutes up the road, the local high school that both my boys go to are gone to excuse me, no one in the last 10 years has made it to Stanford. But we've had lots of kids from this school go to Ivy League schools. And it's, to your point, Stanford doesn't have any data points from this high school. So they're not going to accept a kid. Right? And you take away test scores, it's even going to be more unlikely that they're going to accept a kid.

Brad Baldridge
Right, exactly.

Mike Flynn
So it's really, really strange predicament. And there will be something that will come back. They're always this, these things go back and forth.

Brad Baldridge
Right.

Mike Flynn
The question is, is that if you've got a kid right now, you don't care what's going to happen in 10 years. You only care what's going to happen in the next two years.

Brad Baldridge
Absolutely.

Mike Flynn
So my recommendation for anyone is to take a diagnostic test of an ACTor SAT. Determine which one's better, right? You look at the relative percentiles. There's easy ways to figure out what that is. But use that test as a diagnostic to see if your child really fits in at a school. So if the 75th percentile at Stanford just because we just mentioned it, is 1540, the max score 1600. And you have a child that's very bright, 4.2 GPA, lots of AP and honors courses, bumping that up. But they have a 1250 SAT score, which is around the 80th percentile. Just because Stanford is test optional, doesn't mean that you should go to Stanford. Right, that number, that diagnostic that you took, said, 'I may not fit in this with this cohort.'

Brad Baldridge
Right.

Mike Flynn
It doesn't mean that I, I'm not smart, it just that they're letting in this group of kids that are all these machines

Brad Baldridge
Right.

Mike Flynn
And I just might be a different type of student.

Brad Baldridge
Right, for sure.

Mike Flynn
So we use, I still think that test scores are going to be incredibly important in terms of you finding where you match, instead of a college saying, 'Hey, you're not worthy,' right? It's like, 'I'm not gonna, I'm going to take control. And I'm going to use this test score to see what's going to be a good fit for me.

Brad Baldridge
Right. So here's the problem that I've been struggling with. And I don't know where it's going is, obviously, the pandemic came along. And, again, if you're just getting involved in college planning, what happened with the pandemic is, all the test centers were closed, therefore, no kids could test, therefore, colleges essentially had to say, 'Well, we're going to have to take students without test scores, or we're shooting ourselves in the foot, we're just not going to get any students because nobody can take a test, no matter how hard they try, and there's a big fiasco around that.' And that would have been, I guess, the spring of 2020, which impacted students that were applying the next year and so forth. Well, since then, the centers have opened, but many of the colleges said, 'We're going to be test, no test required, test optional, whatever.' They have various sorts for the next year or two, when they decided to launch that. Are they talking about the beyond this year or two thing now? I mean, is there a way to understand again, if you have a high school junior right now? What are they doing for high school juniors and our sophomores? Are they still test option for them? Are they even telling us what they're going to do? Are we just kind of guessing at this point?

Mike Flynn
Yeah, so this is what I call getting dressed up for the ball, you don't know if anyone's going to dance with you once you get there. But you've got to look good. You've got to shower, put on your best suit your best dress hair and makeup, you got to look good, and hope that when you get there, someone's going to dance with you. So you can't just assume I'm going to go in in my, you know, shorts and holy T-shirt and not have showered in two days and hope that someone, maybe someone will, but we don't know. So this is an unfortunate point in time, where you might have to be over prepared. Because you don't know what college, you know, University of Michigan, I've got a student that was applying to drastically different set of requirements than UT Austin, University of Texas at Austin.

Brad Baldridge
Right.

Mike Flynn
So we had to play two completely different games in order for her to at least be considered.

Brad Baldridge
Right.

Mike Flynn
So it's unfortunate.

Brad Baldridge
Right? So

Mike Flynn
It might change next year, it might not

Brad Baldridge
Right. So your best advice is assume that tests are important. And do the testing, do this prep if you need to all that type of stuff. And then if you, turns out you don't need the score, or they're not even taking the score, well, then at least you are prepared in case they did.

Mike Flynn
Correct. And again, that basic fundamental is what does that test score tell me? Well, can I read critically? Do I understand grammar? And can I reason mathematically? And so if I'm scoring below that number, that, I'm not going to use it for a test, but maybe that's not the school for me, right? So that's what I think

Brad Baldridge
It might be telling you one more thing, though, is, am I good at taking tests? Because I think some people that can read well, just for whatever reason don't know how to fill the right ovals. They can't line it up, you know? So let's talk a little about that. Since you are a tutor what, if I have a parent where I got kids, a lot of parents already know this, right? I've got a kid that just can't test. Well, whether that's because every high school test they've ever taken, or maybe it's the a lot of high schools will have some sort of state mandated progress tests where my kids gets all As, but when we get the progress reports, he's in the 32nd percentile, it's like, how can that be, right? I mean, he's one of the tops kids

Mike Flynn
There's a disconnet

Brad Baldridge
There's a disconnect, and is it the test? Is it their ability to take the test, or is it the actual knowledge that's on the test?

Mike Flynn
Worse, or D, all of the above, right?

Brad Baldridge
Right, exactly.

Mike Flynn
What has, whenever I engage people in social media or, dinner parties, right? Because I live in a big city, but in a small little neighborhood, and it's amazing, my wife and I get invited to a lot of dinner parties, whenever testing comes up, or people need to do something for college, I become very popular dinner guests. And I have to tell people, and it's a very unpopular opinion, that the ability to take a test is a skill. The ability to work under pressure, and know that this is going to have an impact on something is a skill. Now, you may not be good with this. And that is okay. I am, I tell my kids, 'I'm brilliant, but slow.' They question the brilliant, but they confirm the slow. In a sense, I'm not going to be a great tester because I need to really think about things and process right? I work very slowly, but I work. I'm a much better researcher than, say a courtroom attorney who has to be able to think very quickly. So law was not going to be a good fit for me, because that's not my skill set. I also can't learn, I think I'm every bit as smart as some doctors I've met, but they have to learn information so rapidly. I couldn't do that either. So these tests tell us something about who we are. Yeah, I got 32nd percentile, pardon me on this exam. What does that tell me? Well, I'm As in school and Ds on this. Okay, what could I work on? Could I work on my decision making? Right? And sometimes this goes back to the parents or the upbringing. I don't want to blame everything on the parents. It could be the school. You know, my children based on my upbringing with my father, everything was a challenge. Why are you doing this? Right, I had to defend myself, I had to show the logic. And I think I'm good with that. So I tried to raise my kids the same way. Consequently, both my kids were good test takers. Sometimes birth order affects where the older sibling, right, I have a two nieces this way. The oldest sibling just just explains everything to the other one, and the other ones happy to go along. Consequently, I fear that in 10 years, she's going to struggle taking these tests.

Brad Baldridge
Right.

Mike Flynn
So if we don't score well on tests, let's diagnose why. Is it knowledge? Well, the easiest way to learn that is to take an SAT or ACT untimed. How did you do? What was your content score? Right, you took eight hours to take a four hour exam and you got a perfect score. You'd have zero issues with content. You have a pacing issue.

Brad Baldridge
Right.

Mike Flynn
Okay, I take an untimed test and a timed test. And my score is exactly the same. Pacing is not my worry, content is.

Brad Baldridge
Right.

Mike Flynn
Right? So again, those tests can be really just just flipping the perspective. And let's use this test as a diagnostic for my skill set. And then determine what do I need to do now? I've maxed out on my pacing. I know all the content back and forth. But I'm going to struggle when it comes to going fast. Okay, maybe I don't belong in a school where 99% of the kids have 99th percentile scores. Right, MIT and Caltech? Not going to be for me, I have a degree in Humanities. Great, the test and the GPA told me that that's why think tests actually still have, some sort of test has some sort of importance.

Brad Baldridge
Right.

Mike Flynn
Right. We got to work out any biases and things like that. But that value of that test and working under pressure does have an impact.

Brad Baldridge
Right. And I think one of the arguments I've heard out there is, yeah, the people that can spend all this time and effort with tutoring and prep and all that kind of stuff. You know, they're the ones that get the good score. And I guess my answer to that is some colleges, that's what they're looking for, is somebody that can get a top score, they don't care how hard you worked at it, or how many times you worked at it, etc. But they want to know that eventually you can get there. I mean, there's some kid, there's lots of people out there that no matter how much tutoring, they get, you know, they're just not going to learn the high level math. It's just not their thing. And it's never going to happen. Raising your hand I see. Yes, yeah.

Mike Flynn
Yeah. So again, let's go back though, right, everyone says, and that was the Khan Academy coming out and making all of these, you know, hundreds of hours of free prep? Well, there's an opportunity cost there too, right? How much time do you vote studying for one thing when you could have been studying for your grades or you could have been playing a sport or learning an instrument or having a meaningful relationship with a group of friends, right? There's a bunch of very things that we can do there. So let's look at again, what is required to do well on this test? I've got to read at above the 11th grade level. New York Times is written at the 10th grade level. Law books are written at the 13th grade level, the USA Today, sixth grade level, right? That's why it's the most popular newspaper in the nation. Right? All those pretty more pretty pictures and graphs, we know it's not going to be too high on the readability index. So if you can read the New York Times comfortably and understand the vocabulary and go through, you have a better shot of succeeding on the SAT an ACT. But aside from that, you're going to do a better job when you get to college. You know, they pulled college professors and said 60% of the kids were not prepared and overstimulated. They couldn't function without their phones, they couldn't extend for in deep engagement, extended periods of time, and they couldn't read the material or do the math required. Over 50% of kids have to take a remedial course when they get to college.

Brad Baldridge
Right, absolutely.

Mike Flynn
And and that doesn't go towards, I took six units, I took you know what they call 'bonehead English' and 'bonehead math,' those intro level course, those don't apply for graduation credits. So now all of a sudden, you're taking a four-year degree and making it four and a half or five, right, dependent upon how many things I have to do, which then causes a whole other set of downstream problems. So having good scores is less important than having the content required to score well.

Brad Baldridge
Right? Absolutely. So and I think another thing to really understand is what the goals and the capabilities of the student are, right?

Mike Flynn
Yes.

Brad Baldridge
I mean, if you've got the valedictorian or the salutatorian, at your high school, you're going to have a different goals around testing and different school lists and that kind of thing, then if your kid is struggling to just get through high school, and you're thinking, well, maybe community college, maybe four-year college, maybe no college at all, we're really struggling with what the next step is going to be. So I think that it's important that people take that of it into the mix as well, again, because a lot of times, when you talk with test prep people or other academic coaches and that kind of stuff, they have their niche, and a lot of them are working with those high fliers. And they don't really comprehend what a B student thinks and and how they, it's like, they're just not that motivated to just work that hard. That's why they're getting Bs. Lot of times they are capable of As, they just don't care enough. And it's a different path potentially, for those types of kids. And as many parents have multiple, I have a wide spectrum of kids. Let's put it that way. So you know, and again, it's...

Mike Flynn
We call ours North and South. So if that helps you out.

Brad Baldridge
Exactly right. I mean, so it's that challenge of some are motivated, some aren't. And there are different paths. And there's not, there's a right answer, potentially, for a particular student, or many right answers for a particular student, and many wrong answers for that same student. And those same answers aren't necessarily the right ones for the next student. So you need to take it and contextualize it with the abilities of the student, the desires of the student, the capabilities of the student.

Mike Flynn
And that's the perfect summary, right is that its capabilities and desires, that's such a smart way to go about it, because you automatically put that child's future in their hands.

Brad Baldridge
Right.

Mike Flynn
Right, I'm going to do my very best to give you all the things that you need to be successful. But now it's up to you to be successful. Right? And is there something that I can do as a parent to help that out? Well, content wise, hey, let's make certain to read, write. They have good study skills. Habitual academic behavior is what that's called. Let's go through and we make certain we have that, but now it's all on you. And sometimes, kids need to fail in order to find motivation. Sometimes they need to have success to find more motivation. And sometimes they just need to get a little bit older.

Brad Baldridge
Right? They just, yes, absolutely. All right, let's change gears a little bit, because you have another concept that I want to get into. You call it the 5-10-20 rule. And I'd love to dig into this as I'm a little bit of a data geek, as are you apparently. So can you tell us a little bit of what that's about and why we would care?

Mike Flynn
Sure. In Silicon Valley, by the way, geek is a, that's like a badge of honor. Right. So you know, yeah.

Brad Baldridge
Right. Ever since the Big Bang, geek doesn't mean what it used to. So

Mike Flynn
Right, right. It's amazing how all of a sudden I became less dorky, right? So 35 years of doing college planning, and my first several years, the way I was taught, was, 'Hey, get them into the best college.' Best college right? US News and World Reports, the magazine used to put out right when, when you could buy a magazine would put out this list of the top 10, top 50, top 100 colleges and my whole goal was to get kids into those because it was great for my marketing. And because I live in a small neighborhood, I would see these kids that I sent off to college. I'd see them a year later and I affectionately call them boomerangs, right. I sent them out but they came back and they're working at the sandwich shop, and I go, 'What happened? You got into Stanford, Harvard, Yale,' and 'It just wasn't for me.' So after a lot of failure, I stopped blaming the kids and said, 'Well, it's got to be my fault.' Right? I'm putting kids into the wrong situation. So through a lot of different variations, I started to recognize well, the longer that a kid goes to college without a degree, the more unlikely they are to actually get the degree. And that degree kind of unlocks a lot of things. Right, you know, it's just easier. And then, once I have that degree, what can I do with it? When does this become an investment? My college experience is an investment versus an expense. And then finally, what is the sector that I'm going into, what's kind of the 20-year tailwinds? What do I do? Am I going to have to worry about a job? And a quick example of that is journalism right now. Everyone with a phone, and a Twitter account is a journalist. So for you to go spend a lot of money going into journalism, I think it's a noble pursuit. But you know, that's going to be tough, but that sector is going to look a lot different in a handful of years. I don't think there's a 20 year outlook. So 5 stands for, 'Can I graduate within the national average, which is 63.8%?' So I set my number at 70% cannot, just my college and my degree have a 70% chance of graduating within five years? 10 years. So by age 20, excuse me, 33. Right? If I graduated 23, 18 to 23, that five years? By 33, what's the ROI? Average ROI, right? I know, averages can be a sticky word there. What's the average ROI on this degree from this university? And then what's my outlook for 20 years, and there's no data that gives us all of this. Now for you, because I respect the fact that, hey, not everything can be average, that's true. Just because some other person failed in this doesn't mean that I will. And that has to be factored into all this. So we want to use this data to help our logical process. But we still need to figure out the emotion when we go to decide for this college in this major.

Brad Baldridge
Right.

Mike Flynn
So I'm hoping that we'll be able to put, a link to the database that I've created.

Brad Baldridge
Absolutely

Mike Flynn
And parents can go there. And it's a database that I would want as a parent. And as my son, I have a senior who's going through this, this is my baby, right, is going through this process. And every time he wants to apply, I go right to my database. I said, "Well, Case, I don't know if this is a, this doesn't have great long term prospects at this school. But then, 'Oh, look at this one, this does.'" So it helps guide us. Is it going to be that final deciding piece? No. But if I can keep him from boomeranging, right, I feel good. So this is, what I've got on my website is exactly what I'm using for my son. And I think it will, I'm looking into the future, I'm looking at student outcomes, future student outcomes, to try and help determine whether college is going to be an expense, or an investment. And in 10, I don't really know, right, I'm just kind of using housing in my area, you buy a house, and it's going to be a handful of years before you're actually going to start to make any money because of all the fees etc. But 10 years seem to be a pretty good number. If I would invest, and I could double my money in the stock market every 10 years, that's pretty good. So if I can get out of college and have my money I spent now start to turn positive. And that's how I came up with that 10, should it be nine, maybe. 10 sounds excellent. 5-10-20 is the concept.

Brad Baldridge
Right? So let's kind of break this down a little bit. 'Cause I think we use a little bit of jargon in there. So some people might be a little last as far as. So essentially, what you're saying is, if I go to this certain college, and let's say I spend 30,000 a year for this particular degree, after four years, I've spent 120,000, I go out and get a job that pays 50,000 a year, that has a certain ROI. But if I can go to that same college, pick a different degree, and get a job that pays me 80,000. Well, that gonna have a better return on my investment, so to speak, because obviously, I get more money at the same expense. So you there's two levers you can pull there. One is you can lower the cost, essentially and say, 'Well, if I keep costs low, then a $50,000 a year job looks just as good as an $80,000 year job. If I can keep the education costs low enough, because again, the person that's earning 80,000, might be spending 30,000 a year on loans.' So yeah, I guess, to conceptualize, what we're talking about, right is

Mike Flynn
A lot, a lot of calculus involved here. Yeah

Brad Baldridge
Right, exactly. So the basic gut instinct logic applies here too, right? If you can get a nursing degree and you start it, whatever, nurses start at 40-ish dollars an hour, and then you can work a swing shift or nights and work 45 or 50, and work on a holiday and make 120, that looks pretty lucrative relative to the average student goes to a below average college and to get a sociology degree, and they end up at Starbucks. I mean, that's a real thing. And people pick on that. And, again, that's why and then there's a little bit of truth to it. And that's why it rings. So people do it. Right, that return on investment is not there, unfortunately. But I'm not saying sociology is bad. I'm just saying

Mike Flynn
We need sociologists.

Brad Baldridge
Absolutely.

Mike Flynn
They just don't know, if I would spend $200,000 on a sociology degree, I would maybe spend 100,000, and then think about going for my masters at a school that was that next step up, maybe that was the better approach

Brad Baldridge
Or find a hospital system or something to work for that will pay for your master's degree, etc, etc, etc. Right. So there's many paths. And I think that's where spending the time and effort to explore. And I think that's another return on investment that most parents don't think much about is when we get to this late stage college planning. If we blindly stumble through it without a lot of effort and reflection, often we're gonna pick a path that isn't optimal, whether it's, again, leads to changing careers, changing majors, changing schools, none of which, at the price of college these days, that's a bigger deal. When you and I went to college, it wasn't unusual to run into the guy that's, well, I'm on my sixth year, because I changed majors four times. And I'm thinking about changing in a fifth. Because I like college. It's fun to be here. And, and it wasn't so expensive. So lots of people did that. And it didn't have a huge financial consequence. Of course, today, the fifth year is a huge penalty. And whatever you can do to avoid that can make a big difference as well.

Mike Flynn
Yeah, and you can certainly find, so if you notice that I use 5-10-20, right? We talked about a four year college, well, that term for your college is actually becoming a misnomer. Right? Few people are, in terms of out of all of the students that go fue get out and for. Right? But as you've noted, what a huge difference, right in for your ROI, when not only are you picking the college, but you're you're choosing the the length of time, there's so many different factors there. And again, sociology, maybe that you're gonna have to do some hours afterwards of volunteer work in order to earn some sort of credential or license. And my gosh, right, all of a sudden, now, it's just extending that out. So any of this stuff, just to try and help so that you don't go blindly into the night?

Brad Baldridge
Right?

Mike Flynn
It's just, and if you're a late stage, parent here, I would hope that this would just do nothing but actually clarify. So you introduce one more tool and like, oh, there's too much. There's too much. No, I think that this tool is so so simplistic. This concept of like, 'Oh, okay, checks that, checks that okay, all right, this now becomes one of the schools.' There's 2000 schools that we can look at. So everyone says, 'Well, it's what's going to be the best school to go well, no, it's what's going to give me the best future outcome.'

Brad Baldridge
Right.

Mike Flynn
But I don't actually look at it that way, I start looking at all the ones that don't fit. Right, and I use the needle in the haystack, right? You could straw by straw, you can go through and be there all day, or I throw a match into the haystack. And then when it's all done, burn, and I'm just going to look for the shiny thing. That's the way I find colleges, right? Let's eliminate everything that doesn't work. And now I'm left with 50 to 25. Right. And now it's going to be a whole lot easier for me to sort.

Brad Baldridge
Right. But I think the challenge I have with this kind of data is again, going back to the averages, right? So I don't know, can you share what for as far as pricing? What did you use for pricing in order to what did the student pay for the ROI calculation? Was it no list price or net price? Or?

Mike Flynn
Yeah, so there's a couple of different numbers that were brought in. And the most consistent number, the best data comes from Pell Grant numbers, right, which is a federal grant. But not everyone does that. So we could have tried to take the average from the Pell to the maximum. So what we did was we went with sticker price, right? What is that maximum amount. And, again, that led to slightly different outcomes when I use Pell Grant numbers, but not everyone had that. So I'll be the very first to admit. It's a guide. It's not the be all end all because my son wants to go into screenwriting. And he wants to go to a school called Chapman which is in LA which is, you know, they accept 4 and 100 kids, right? It's going to be very hard for him to get into, UCLA Film is the other one. So it shows you what I'm up against here, right. And it's the sort of thing that, you know, it's not a huge ROI thing. But it's when we take a look at the school and what the other things you can do for it. And also the fact that he can get a degree in business and maybe minor in screenwriting, there's all these other things now of a sudden movie producing novels and his options open up. So all it does is it's trying to give me a little more context, in terms of is this college, rather than someone's opinion? 'Yep, that's a great school. Oh, okay. so and so said, That was a great school, I got to go with that.'

Brad Baldridge
Right? Well, again, so here's my recommendation or thought to pile on here a little bit, which is, if you've used list price, if you're the kind of kid that's going to get half off of list price at some school and pay list price at other schools. Now, all of a sudden, that changes the ROI at the schools that are really cheap, right? It takes Stanford as an example. It can show a need at Stanford and you're at $100,000, it's probably gonna be the cheapest option out there.

Mike Flynn
Right.

Brad Baldridge
You got to get in, which is the hard part. But it will be really reasonable if you can't, yeah. And on the flip side, going out of state to Michigan, where everybody pays full price for out of state price at 50 plus thousand. You know, again, did you use that full out of state price of 50 plus thousand? Or did you use the in state price at 27? Right?

Mike Flynn
So simply the variables to adjust there.

Brad Baldridge
Exactly. So on my website, I have the net price of colleges, which essentially shows after scholarships and grants, average price. And again, another big fallacy, right? So the net price of Marquette. Something right here at my neck of the woods is 35,000. If you earn 110,000 plus, does that mean you're gonna pay 35? No, because I've seen families pay full price. And I've seen families go at a much get a substantial scholarships, right? Like the basketball player at Marquette. He didn't pay anything. But he's balanced out by the son of the surgeon who didn't care what it costs. He just liked Marquette for whatever reason, and he wrote the check. Right? So that's

Mike Flynn
My zip code in Silicon Valley, you would think that I was wealthy. But if you saw that I drive a 2008 Acura in my wife's car is a 2013 Chevy Bolt, you would say no, we're not rich, but it's just the neighborhood we live in and the price and anyway, so there's just all these things. One of the reasons I could not go with the net price, you're not afforded that information when you're doing the search?

Brad Baldridge
Yes.

Mike Flynn
That's the information you get after you get accepted and you receive your financial aid package.

Brad Baldridge
Right? Well, that's changing. That's what I help families do where we actually can get that price before we apply. And again, when we can get an estimate at that price. You know, it's not always 100% accurate. I mean, it's never 100% accurate, but it sometimes works. Sometimes we're not

Mike Flynn
Yeah.

Brad Baldridge
But yeah, the challenge is it's highly variable. So even if you can figure out your net price, to figure out the net price of the various participants in your the study that you did, would be essentially impossible.

Mike Flynn
Yeah, there's multiple sides to all of this data. And I'm trying to take and allow this data to be a guiding factor a not a center rail, but just a guardrail. Right.

Brad Baldridge
Right, exactly.

Mike Flynn
Again, that net price calculator for Purdue where my oldest son goes for engineering never materialized. Right, I pay full boat, for out of state were there even though that we were told going in that are, well, we were guesstimating, that it was going to be something different? It just, again, I had to pick a path and I just went with that path.

Brad Baldridge
Right, exactly. And I think that right, for sure. I mean, it's better than nothing as always. I think that's where I talk to families and try and encourage them to understand that. If you want someone to give you the quick answer, it doesn't exist, unless they boil it down to averages or something. And then which case that quick answer is not worth much, because it doesn't factor in much of your reality. So then you essentially just have to do the work yourself and really understand what college is going to cost. And then, as you mentioned earlier, I think he said if you've got the means or something and you're I think it's, if your family is going to give up the lake home so that you can spend crazy money on college, more power to me, I mean, go do it. Right. But if you're gonna bury your kid in debt, or you're gonna delay your retirement substantially so you can spend crazy on college. Well, you know, that's a different decision. Obviously. Many of us earn our money and we spend it foolishly one way or the other if we spend it foolishly on education. Great, right, right. I mean, but on the other side of that coin is we were talking before the we started the recording that parents should be the adult in the room and they're the ones that should try and put some sanity back into this decision process.

Mike Flynn
Yeah, there's so many different issues there. One for parents, it has to be your child's choice. It doesn't mean that you can't give an opinion. You know, your child will look forward to your opinion. I just don't think that it has to be your IDIC that decides, right? You're going here or there? Oh, gosh, whoa, could I maybe go there and we make these accommodations wherever those modifications or accommodations are. When it's a teenager's choice, I call it my Jedi mind trick. Right as I never give them a yes or no answer. Because if I'm expecting to guess, and they give me a no, now I have a fight. So I give them the illusion of choice. Would you like to do this? Or would you like to do that and either one are acceptable by me, I now am giving them that opportunity to think through logically what would be in their best interest. And when it comes to money, and if you are a parent that's paying for this, you would not, you buy a $500,000 home, a million dollar home, $2 million home doesn't make any difference. You have to buy a home that's going to be within your financial means. And that you hope is going to be in a good neighborhood. So it's going to have a good resale value, or it's going to be something you'd want to give to your child when you move on. Why would you not look at college with that same perspective? Right? Let's look at this as, 'Gosh, that just doesn't make good financial sense to do this.' Now, we don't know if the tree is going to fall in the backyard in a big storm and knock this house down and insurance is going to build me a new one. Or if the neighborhood's going to go to pot, right, we just can't control that. But we have to have something to help us make that choice.

Brad Baldridge
Right. Exactly. And I think the challenge with the education, right, is the people out there giving advice are not known as well. I mean, we're it's a relatively new profession, right? Certainly, there's a lot of you out there that are advising students and helping pick majors and careers and write essays. And now, myself, but more on the financial side, working with parents, we're even newer, so most people don't even know we exist. So your pipes are leaking in the basement, you know, to call the plumber, right, your tax mess, or you call your accountant, trying to figure out how to pay for college, well call me, but you got to know I exist and know what to call me when you search the internet. And that's the challenge that we're up against. And I think there's a wide array of help out there now. And it makes more and more sense because life's getting more complex, and

Mike Flynn
Dollar amounts are going up.

Brad Baldridge
Right, the prices are higher, the complexity is higher around how the system works. I think education in the long run is due for some reforms similar to the publishing industry. But it's also slow to change. Because there's, again, as a parent, you and I are both paying, and sending our kids to college, part of it is a little bit of nostalgia, right? It's one of the best times of our lives, and we want to give that experience to our kids. And we're willing to pay for it.

Mike Flynn
Right

Brad Baldridge
You know, it certainly wasn't the lowest cost option that educate our kids, it was what we consider the best option. Again, just like some people have drive expensive cars, because they think that's best.

Mike Flynn
Right? When I tell kids when, before kids go off to college, right? As I, I maintain relationships with these kids and follow up and mentor them to make certain that they're on that path and go when you graduate college, it's great to get good grades, but it's better to have a better network.

Brad Baldridge
Right?

Mike Flynn
And right, if the only thing that you got out of college was a decent GPA and a great network, you really did that one well, right. You know, as opposed to me, I got great grades and have zero network. All of my friends are from high school, I had my head down and didn't go to parties didn't do it. I went to play sports in college and all that I was also a geek, as you happily mentioned, and my focus was elsewhere. And there was no like net where I didn't understand them that value. So we have to kind of go into what else would you do with an 18 to 22 year old?

Brad Baldridge
Right.

Mike Flynn
What are the things can they do where they can go, grow, learn, make mistakes, fail with a safety net and develop this network, right? We don't have. We have bars for 21 year olds, but that doesn't always lead to a great place. We have golf courses for some older folks. Where is it that we take 18 to 22 year olds and let them develop a lifelong network?

Brad Baldridge
Right. Exactly. And I've talked with others about what if we had communities where young people went there and lived but they don't necessarily take classes there. They could take online classes somewhere else but they lived in a commute. You know, we could separate the whole campus from the education theoretically, hasn't happened yet? Will it happen? I don't know. And that's a whole other podcast, probably. But yeah, as

Mike Flynn
Colleges are struggling, so right, think about that one when you start looking at the number of bankruptcies and all of that, the college landscape is going to change dramatically in the next 5 to 10 years, the big colleges, and they get bigger and the small colleges are going to go away.

Brad Baldridge
Yes, yeah, I think there's room for consolidation, if you've got a strong college brand. Maybe you go by a bunch of little struggling colleges and share your brand and consolidate. You know, again, a lot of the stuff that happened in the publishing industry, the broadcast, where lots of newspapers are all bought up by various, became conglomerates. Why aren't colleges doing that? I don't know. But you'd think it would happen? Maybe it will happen? I don't know. But yeah, it's been great talking with you. If people want to learn more about us, first of all that data 5-10-20, can you specifically give us a directions on where to get that? I'll certainly put it in the show notes as well. But better on your website, I believe, right?

Mike Flynn
Yeah, if you go to in engeniuslearning.com and as I like to say we spell engenius, the right way, E-N-G-E-N-I-U-S learning dot com, then there will be a link to college prep. And it'll be the very first link that you see, Is College Worth the Cost. And on there, I have the instructions and that formula 5-10-20. And then the full database of 30,000 different colleges and majors or majors at colleges, I should say, where you're able to go and you're able to take a look at that 5-10-20. And again, it's data, right use it as you will, don't set your clock by it, but do recognize that, 'Hey, wait a second, maybe I need to just consider this school before I sign that commitment paper.'

Brad Baldridge
Right? I mean, I think even if you just spent the time to drill into how you decided to do the math would be a great guide for someone to start thinking about what is ROI? Why would I care? That alone would be worth the time and effort for most families to just drill into it and say, 'Am I getting what I'm paying for,' which is really the bottom line.

Mike Flynn
Right? I'll tell you something interesting. Is that on that webpage, because there's data and statistics on everything. Most of my web pages get to three minutes, I have an SAT. You know how to take the SAT, PSAT, 10-11 minutes, this one, the average length of time on the page is close to 30 minutes. So I know that once someone discovers it, they're like, oh, okay, it opens up a whole other world that just to get, if all I can do is to help you think about this process, so that you go in to college with that commitment that you're about to make financially and time wise, and you have your eyes open, I'm gonna feel real successful.

Brad Baldridge
Right? Absolutely. All right. And then if they want to reach out, there's also ways to get you through the website or you want to share some of your social or what was going on?

Mike Flynn
Yeah, you can follow me on Twitter at Engenius Prep, ENGENIUS Prep. You can also find me on YouTube under Engenius Prep, or Mike Flynn, not the General Mike Flynn. But yeah, I was number one, I finally got myself to number one nationally on Google until he came about and now I'm buried on page 10.

Brad Baldridge
Well, that's the way it goes.

Mike Flynn
It's the way it goes.

Brad Baldridge
All right. Well, it was great talking to you. And I'm sure we'll stay in touch.

Mike Flynn
All right, thank you very much. Appreciate it and real pleasure to speak to you.

Brad Baldridge
All right, that was a great interview with Mike Flynn. Hopefully you enjoyed it. Stay tuned for Brad Recommends, where we talk about Deep Work by Cal Newport.

Presenter
The latest tips, tricks, and tools you can use today. This is Brad Recommends on Taming the High Cost of College.

Brad Baldridge
Today, I'm recommending Deep Work, a book by Cal Newport. In this book, Cal talks a lot about how, as a society, we're struggling with the distractions of social media and computers and email, etc, etc. And I think he has a great point in this book where he talks a little bit about the major distractions and how challenging it is to get focus time in order to get into a project deeply. Now if you're as old as I am, you can perhaps appreciate it a little bit more because I didn't own a cell phone my entire life, obviously. I didn't get a cell phone till I was 25 or so. So for a long time, we didn't have the distractions, at least not in the same ways that we do now. And I think for many of our kids, our students out there, they don't know anything without a cell phone. And so I see it my kids and I think many of us parents see it that generally kids don't really have the capability of focusing on something for a longer extended period of time. And so the reason I'm pointing out the book is as parents, for your professional development and understanding, but it also might be something then that you can delve into a little bit with your kids. Because I think going to college and academic pursuits and those types of things do require at least so far that you'll be able to focus and spend some time studying or spend some time reading or synthesizing ideas and writing. All the creative ideas that many people have to work on, requires some focus time and deeper thought. And it's hard to get into the groove and get to work. And many times we get interrupted and distracted by all the other externalities that are out there. So again, it's looking through the reviews, many people appreciate Deep Work. And Cal Newport is an author that I recommend off, he actually wrote a book when he was just out of high school on how to do well in high school and he's got other books as well. A lot of his work are very good. I've listened to his audio books of a couple of these different books now, I recommend, again, as self development and some ideas that I haven't seen elsewhere as much as I have in his work. We'll put links to his work on Amazon, etc, where you can go out and get it. I tend to listen to his audio books, which are pretty good. Alright, so that's all that we have today. I appreciate you listening. As always, if you can give us reviews on iTunes, or wherever you're getting your podcasts that would be fantastic, it helps people find our podcast. As always, show notes are available at tamingthehighcostofcollege/147 for this episode, we will talk to you again next week.

Presenter
Thank you for listening to the Taming the High Cost of College podcast. Now it's time for you to take action. Head to tamingthehighcostofcollege.com for show notes, bonus content, and to leave feedback for Brad. The next step on your college journey starts now.

Brad Baldridge is a registered representative of Cambridge Investment Research and an investment advisor representative of Cambridge Investment Research Advisors, a registered investment advisor. Securities are offered through Cambridge Investment Research Incorporated, a broker dealer and member of FINRA and SIPC. Brad owns two companies: Baldridge Wealth Management and Baldridge College Solutions. The Baldridge companies are not affiliated with Cambridge Investment Research.

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