This Financial Samurai podcast episode is proudly sponsored by Danielson Legal, a boutique law firm helping technology companies with their intellectual property, corporate matters, technology law transactions, and litigation since 2008. Hello everybody, it's Sam from the Financial Samurai podcast and I have with me a special guest, my wife, Sydney.

And in this episode, we're going to talk about the benefits of community college and whether students should take it easy during their middle school and grade school years and not stress so much about getting into one of these elite colleges. So there's a great article out there called Duke, Baruch, or Bust?

Parents debate if pricey private schools are still worth it. Let me just read a little bit from the article to give you an idea of what it's talking about. Clara is a mother whose son is a rising senior at an elite private school in Miami. For the past few years, as his peers have been beefing up on extracurriculars and thinking about how to best translate their passions into projects that will stand out to college admissions officers, Clara's son hasn't been doing any of those things, and Clara, the mother, is thrilled.

Having watched acceptance rates plummet to the single digits as the cost of college has skyrocketed, Clara's family is happily resigned to not gunning for the Ivy League and the top 25 schools that most of her peer groups seize as the crowning achievement of a gilded high school career. This means that her son is limiting the number of AP courses he takes to five throughout high school.

Some kids take as many as 12. And if he says he feels like he doesn't want to do soccer this term because there's too much on his plate, no problem, Clara says. We decided his health and wellness are much more important than getting a weighted 5.0 GPA, having no social life, being stressed, and doing homework until two in the morning.

So what are your thoughts about Clara's attitude and her son's attitude towards taking it more easy during high school? The thing that jumped out to me the most was 12 AP classes? How many kids are able to take that many? That sounds crazy. Five? Five itself is a lot, way, way above average, I would think.

Maybe above our average, but not today. These days, it's all about mega competition. I guess a lot has changed since we went to school. I think I took, I can't even remember. Maybe I took three APs in high school, and that was tough. Well, that's why you ended up at William & Mary with me, because we were just average.

So what are your thoughts about taking a more easy course load in high school and not worrying about getting into one of these top 25 or top 50 colleges? Well, I think it depends on how you define easy. If you consider easy 5 AP classes, that to me sounds like her son is still trying very hard and doing well.

I don't think, again, we don't have a high school student right now, so I don't know if that's really the norm to take a minimum of 5 AP classes. She knows her son best. It sounds like what his peers are doing is just not feasible for her son's mental health.

I think that's great that they've found a healthy balance for him and their family. If going to community college is better for balance, then that's the best way to go. So imagine if you went to private school for 13 years, you spent $500,000 for private grade school and you went to community college.

What are your thoughts about that? I think there's nothing wrong with going to community college. And even if you do, you can still have the option to transfer at some point during your college duration. What do you think? I think community college is the way to go for people like us.

We went to state schools. We don't have really high academic achievements. Just look at our SAT scores, they were quite mediocre. We're Asian-American, so we have this Asian penalty for some reason to need to score even higher to get the same chances for our kids to get into college.

So I feel like for us, there's really little to no hope to get into a top 25 or top 50 university, especially the private ones, because they have their standard criteria and they pick and choose who gets in and who doesn't. And a lot of times it's subjective. And so I was thinking to myself, well, maybe community college is the way to go.

And I wrote a post about community college being a great option. And I got so many great responses from the readership. For example, Champ, a reader named Champ said, "Both of us went to community college and earned six figures before we both retired in our 60s. All our children went to community college and transferred to state universities.

Total college costs for five children, $180,000. No grants, no scholarships, nothing. They paid their own way. They all earned over six figures. And one son and his wife earned seven figures. Relocate and live responsibly instead of high rolling nonsense." And I really love that feedback. And after I wrote the post, I had another 40 plus commenters who went to community college and they're all making six figure incomes.

They're all living pretty healthy quality of lifestyles. And I'm thinking to myself, this sounds like the way. Maybe two years community college, it's probably going to be free by the time our kids go to school. They can transfer to a four year state university if they want to save more money.

Or if they can get scholarships, they can transfer to a private four year university. Sounds good to me. Are you on board? - I don't have any problem with that. Because this is something that I'm really thinking about. Because I don't want to go through having a stressed out son and daughter who thinks they must take 10 AP courses and get a 5.0 weighted GPA and do all these extracurricular activities and try to save the world.

It just seems ridiculous to me. - It's way too competitive. And we're going to figure things out when the time comes. And we're going to do what's best for them. And even, let's say they, for some reason, they got into one of the top colleges based on a talent, for example.

But we knew that they would not be able to keep up academically. Even if they got into that top school, I'm not sure I would want them to go if I knew that they would be struggling for four years. I think there is a lot of value in balancing mental health and going to a school where you will feel confident.

You'll be able to excel. You'll be able to learn at a pace that you can keep up with. So that when it comes time to graduate, you'll be in a good headspace and have a good foundation and have built relationships with your professors and your peers and be ready to jump into the real world.

- Right. I would also want to share a comment from Zen Master. And he's interesting. I think he's a lawyer. And he's so candid in his thoughts and the comments. He was just saying, "I've got my twin daughters and they are just depending on me for everything. They went to private universities.

Doesn't seem like they'll be able to get good jobs. Whenever they have some kind of expense, they call me to ask for money." And one of them is an adult who's graduated already. And I asked him, "Why not just not give her the money?" And he goes, "I just can't do it.

I'm too dependent on her." And so I asked him, "Why, if you could rewind time, why did you end up going this route of super privileged lifestyle, private college and everything?" And one of the reasons he talked about was peer pressure. He was saying even though he realized that giving them all the privileges in the world was maybe not a great way to harden them up, right?

Because if you are soft, you create soft kids. If you are hard, maybe you create harder kids. And he said peer pressure, in terms of peer pressure from other parents, from teachers, from guidance counselors, from other friends, parents, right? Who have kids. He said he just couldn't say no to that private college route due to peer pressure.

Do you think you will succumb to peer pressure, Sydney, from other moms and other dads out there? I don't think so. I think I'm pretty chill in general in terms of my personality and lifestyle. Because at the end of the day, we want our kids to be happy. We want them to succeed.

We want them to feel confident. And even if they somehow manage to get into a top private university, if we knew that that wouldn't help them succeed in life, then I don't think we would encourage that. We would obviously have many discussions together to figure out what we felt would be the best decision.

Ultimately, they would need to choose because it's their decision, their life. But I don't think I would succumb to peer pressure. Why would we want to make someone else happy if it's not going to benefit our children? Okay. Well, let me ask you this then. What do you think about sending our kids to public school and saving a lot of money over the next 12, 13 years, given we don't succumb to peer pressure?

And the path to community college sounds like a good one. It all depends on circumstances and there are a lot of challenges that we've witnessed in the San Francisco public school system that we don't feel are the best fit for our kids. And for some families, it's great and I'm all for that.

We just have to look at what works best for our own family. Yeah, because I know if I was six years old, let's say, and my parents said, "Would you like to go to a private grade school and get no money upon graduating from high school? Or would you rather go to a public school and get $500,000?" I would say, "Give me $500,000 for sure." And one of the reasons why is because I went to public school in high school and it was fine.

Obviously, there were some ups and down moments, but I was like, "Give me the $500,000. That's a no-brainer." And if I can invest this... You're talking about asking a six-year-old this? Come on. That's not... I know it's not realistic, but you can ask a 13-year-old before he or she goes to private high school, "Would you rather have, let's say, $200,000 or $250,000 and go to public school, public high school, or go to private high school?" I think these are questions we need to ask as personal finance people.

We need to understand the opportunity cost. Because let me continue in this article on Duke or Baruch and where this quote came from. So this mother gave her son, who attends an elite Manhattan high school, an ultimatum. "It's either Duke or Baruch. I'm not paying $80,000 a year so you can go to Middlebury and learn to build a bonfire." Although the family has means and can afford a school like Middlebury, one of the top liberal arts colleges in the nation, with a 14% acceptance rate, the mother doesn't see the practicality of paying for a so-called "select tier 2" college in today's world.

Her feeling is that an Ivy or Ivy-like school like Duke, Stanford, MIT, etc. degree offers a level of prestige that will more readily translate into job opportunities, thus justifying the price. And I thought this quote was awesome because my Mandarin teacher in college decided to leave the College of William & Mary and go to Middlebury.

And I remember Middlebury always being a wonderful liberal arts college with a wonderful, wonderful language program. And this is also a school that you and I probably would never be able to get into because of its low acceptance rate. And in retrospect, I'm thinking to myself, "Yay! I'm glad we weren't able to go to these expensive schools because we were able to graduate without a lot of debt and move on with our lives." So, I guess my hope is, it sounds great to me, so you think you're not going to succumb to peer pressure.

I feel I'm a little bit more realistic when I see other people with a nice car or a nice house, you know, promotions and pay. I feel a little bit like, "Oh, I want to have a nice house. I want those nice shoes. I want that nicer car. Why not me too?

Why not for our kids too?" You sure you don't feel any of that? No, it's just a very simple example. We go to a lot of events, playdates and whatnot. And there's moms there who are always fashionable and looking great. And I think that's awesome. For me, I'm just not into that.

I would much rather buy a cheap outfit at Target or whatever because I know I'm going to get stains on it within a week. That's just who I am. I'm just very practical that way. But everybody spends money differently. I don't even know if you would consider that peer pressure in terms of looking your best.

Yeah, it is social pressure. I don't feel peer pressure to change myself in order to fit in. I've never heard anybody say that they don't experience any peer pressure. I remember when I met you in college, there was the grunge phase and you had baggy pants and bell bottoms and stuff like that.

Isn't that peer pressure? So what I experienced as a student is different than what I experience now as an adult. I think there was a lot of pressure to fit in at school. You didn't want to be the odd one out and not have friends. I have adult friends who I have similarities with and also who I have plenty of differences with, but I'm confident with who I am now as an adult.

So I don't feel the same types of peer pressure that I did when I was younger. Do I feel some pressure for our son and daughter to be well-behaved and to socialize? Well, yes, I do have that kind of pressure. So you're saying if one of your good mom friends, for example, son, ended up getting into a top 20 university, you wouldn't feel a little bit envious or pressured or like you noticed that he was doing really well academically freshman and sophomore year, entering all these competitions, doing great on PSAT, doing all this extracurricular.

You wouldn't feel like, "Oh, maybe our son should do the same?" I might feel some jealousy in terms of achievements, but again, we've talked about this before in terms of sports. There's a lot of parents out there who are sending their kids to three to four different sports activities a week.

Their kids are having fun. Great. For us, I don't feel that's necessary. Our son isn't that into sports. So why would we want to put him through that if he's going to be miserable and it costs money? We find other activities that he's interested in. Swimming, for example, you guys worked on that.

That's something that was a sports activity that you guys focused on and he loved it. So we're going to focus on things that our kids are interested in and be happy with that. I hear you. I believe you. But I think when the, what is it called? When the rubber meets the road, when it's time, when he's in high school to apply to college and get a job or whatever, I think you're going to feel a little bit different.

I think it's important for parents to actually pull or push, whatever the phrase may be, a little bit more than kids will do on their own so they can self-discover and they can meet their potential. One story for me is I liked tennis growing up, but I wasn't pushed hard enough to train.

I didn't get coaches. I didn't enter tournaments. As a result, I wasn't as good as I could have been. I'm good, but I'm not great. I always wonder, wow, what if my parents pushed me harder to train more on the tennis side, gave me a better framework, more consistency?

I think I would have been better and I definitely think I could have played for college. I was recruited for a D3 college. I think that's why you and I are so involved with our kids. That's something that we really care about and we want to be able to support them in their biggest interests.

I think what will affect me way more emotionally is if, let's say, our kids have their hearts set on a specific school and we've talked about it and we think that school is within reason, they apply to it and they get rejected. That's going to hurt me way more than their classmates getting into a school.

If it was the same school that our kids wanted to get into, then yeah, that's going to hurt. The classmate got in and our kids didn't. We would say, "What's wrong with us?" That's going to hurt. That's going to hurt. I'd be way more emotional about that. I think the reason why I'm more sensitive to rejection is because I've been rejected way more times.

I'm always putting myself out there, whether it's trying to get business when I was working. Nobody would pick up the phone, respond to my emails. They'd say, "No, no, no, no, no, no, no, no, no, no." I compete in USTA tennis at the 4.5 and 5.0 level. I lost so many times, but I kept on competing.

Many times when I lost, I felt crushed for a day. I was like, "Man, I trained so hard and I still lost. How frustrating." I started Financial Samurai in 2009. I remember trying to join these blog networks, which were popular at the time. I got no's from all eight.

Like, "No, no, no, no, no, no. Who the hell are you? Go away." But I just keep on trying. Over time, I've become more hardened, but I still feel that sting, that pain of rejection, which as a father, I know our kids will get rejected so many times. Whereas I think for you, you had a different type of job when you were working and you don't put yourself out there as much as I do, which means you don't feel that sting of rejection as often.

Is that a fair assessment? In terms of the type of job that you had, yeah, for sure. I experienced a little bit of that. When I had in college, I had this very, very minimum, low minimum wage job where I had to try to raise, fundraise for the school.

I had cold call people. It was awful. I hated that job so much. And yes, I was rejected probably 99.9% of the time on all those calls. So you didn't succeed at all? It was awful. I did not succeed. I was like, "I cannot be in sales when I graduate from college." Yeah.

Yeah. So yes, in the type of role that you had at work and all of your athletics, yeah, you definitely had to face way more rejections and failures than I did. Well, so maybe what we should do is to kind of equalize how we feel about rejection and failure and the sting is to get you to put yourself out there more.

Maybe try to send a manuscript to a publisher, for example, or try to do competitive orchestra or violin or do a solo. Really put yourself out there. I've done stuff like that and not gotten the results that I've wanted. Sure. I've had plenty of rejection in my life as well.

So how about we just continue to do that because it's been years since you did that. So you want to put the pressure on me? Yes, because if you feel the pressure and you get rejected at this age, then we'll always know what it's like to try really hard and fail, which would make us, I think, a little bit more empathetic.

Okay, I'll try out for America's Got Talent. I'll get rejected before I even get my audition taken. Yes. All right. Great. Promise me you're going to do some audition and try. Try. You never know. But I feel that a lot of people don't try to put themselves out there, try to do something entrepreneurial or new is because they're afraid of rejection and then it just hurts so much.

For some reason, I have this defiant attitude. If you reject me, I don't care. I'm going to do it anyway. But I think that's a personality trait, but it's also honed over years and years of experience. Yeah, there's this common thing that people are too afraid to try because they're afraid that they can't do it.

I think that's a common fear that a lot of people face. Okay. Well, we don't want our kids to get rejected, but I think rejection is good because it makes them appreciate and try harder. But I think we can't set their expectations if you agree to have them go to community college.

Right? It's cheaper. It's two years. It doesn't require you getting straight A's in high school to go to community college. And if they do well in community college, they can always transfer to a four-year state school or private school. What do you think about going forward this plan as they enter middle school and high school?

I think it's something that we're going to keep open and we will apply to – I think we're going to have to apply to a lot of schools. I feel so many people – it's just like a numbers game. You have to apply to a bunch in hopes that you'll get into one or two.

Right. And just for people curious about what the average income is for people who graduate from community college, it's about $33,000 to $34,000. And the average income for people who graduate from a four-year state school is closer to $50,000 to $55,000. And I think the average income for Ivy League graduates is about $5,000 to $8,000 higher initially.

But it's still not that impressive if you graduate from an Ivy League university. I have an article on this. I forgot the exact numbers. But I was thinking to myself, "What? That's all you make five years out of college from an Ivy League or 10 years out?" I was thinking to myself, "Why stress over for five to eight years of your life during grade school to achieve that when the chances are 95% to 99% chance you're going to get rejected?" All right.

Well, I'm really pleased by that because one of my stresses is are children doing well enough in school to get into a decent college, to get a job and be financially independent or at least independent from us? Because there's nothing greater. Well, there are other things greater, but it feels wonderful to be independent and not have to rely on your parents once you're an adult.

Especially as, I don't know, I think as a male, because as a male, not only do we – I feel like we have to take care of ourselves. We have this growing up aspect where we're thinking, "Oh, we've got to provide enough to take care of the family." And I know things have changed over time, but that's how I felt.

Any last words before we let the audience go? I just wish the best of luck to all the parents out there who are going through the application process this year. All righty. Well, thank you everyone for listening. This episode of Financial Samurai is proudly sponsored by Danielson Legal. Danielson Legal is a boutique law firm that has been helping tech companies since 2008.

They pride themselves on prompt attention to their clients' day-to-day legal needs, including intellectual property, corporate matters, technology law and transactions, and litigation, with pricing designed to provide value to their clients. You can find them on the web at www.danielsonlegal.com. If you would like to subscribe to Financial Samurai, go to financialsamurai.com/news.

You'd also love a share, a review and a rating of this podcast. It helps keep us going. And we'll talk to you all later. Thanks. Bye. Bye. (gunshot) You