What happens if the bottom drops out of TOPS?

Originally published in the News Star and the Shreveport Times on Sunday, February 28, 2016

Question: My daughter is in her freshman year at Tech and I’m scared to death that the TOPS program might be eliminated. I’m not sure I would be able to pay all of her expenses if TOPS is canceled. What do you think will happen?

TOPSAnswer: My ability to predict what politicians might do is about as useful as my prediction of next month’s Power Ball numbers…and just about as accurate.

But here’s something to consider – if TOPS is either canceled or curtailed, your daughter just might get an education neither of you counted on. It won’t be an easy one – but it just might be OK… maybe even good.

TOPS is the “Taylor Opportunity Program for Students,” envisioned by New Orleans oilman Patrick Taylor in the late 1980s. At first, it was designed for poor but academically achieving students. By 1997, income caps came off and any Louisiana student with sufficient academic requirements could get their tuition paid.

Today, TOPS covers about 50,000 students and costs about $250 million a year. The administration has already said they are $28 million short this year and may only be able to fund $65 million of the $250 million needed to fully fund the program next year.

I am not making a prediction. But what if the worst happens? What if the bottom drops out of TOPS, either for all Louisiana students or at least for your daughter? What are your options? What are her options?

Drop out of college forever. Not what you had in mind and not what I would suggest.

Reduce costs. College costs come in four or five major categories: tuition, books, living expenses (room & board) and extracurricular activities. Tuition is unlikely to go down. Books can be borrowed, bought used or even rented. Living expenses can be all over the map for a college student. These days, living on campus can be one of the more expensive options. Living at home may be the cheapest (did I just hear your daughter gasp?  Hold on…)

Work some. Study some. You’d be surprised when I mention this one how many parents react as if I said “tell her to sell one of her kidneys.” Wide-eyed disbelief. An “I could never ask my sweetie-kins to do that” look.

I’m pretty sure that most students enter college with a vague idea that they are preparing themselves for life after college – working. And, yes, I get it that the kind of work available to a college student is usually neither lucrative nor interesting.

I worked in a non-air-conditioned factory the summer before my first quarter at Louisiana Tech. I sorted and stacked scrap metal. All day long. Yeah, it was hot. But was I ever motivated when I got to school and started my studies. Reading a book in the air conditioning vs. slinging metal in Hades. Whatever else I did, I didn’t want to go back there.

Have you ever heard a motivational speech or read a great biography about a person whose life was easy and free from obstacles? Neither have I. While I don’t recommend creating problems for your daughter, I do suggest you allow her to engage in this struggle and own it as her own. What is she willing to do? What price is she willing to pay to go to school?

Student loans. Unfortunately, this is the choice too many parents and students will reflexively make, as if they have no other choice. The way student loans work, the can is neatly kicked way down the road…until graduation. And they, as your child walks across the stage and gets that lovely diploma, will also hang an albatross of debt around your neck – a reminder that the bill eventually comes due for the choices made years ago.

I’m not saying all student loans are bad. I am saying that they are a poor first choice, apart from evaluating cost reductions and work opportunities.

TOPS was supposed to be all about opportunities for students. I certainly hope some version of this program can be retained for current and future deserving students.

But if TOPS happens to curtailed or canceled for your daughter, it may mean an opportunity of another kind.

My message to you both if it happens – embrace it.

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Byron R. Moore, CFP® is Managing Director / Planning Group of Argent Advisors, Inc. Email him at bmoore@argentadvisors.com. Write to him at 500 East Reynolds Drive, Ruston, LA 71270 or call him at (318) 251-5858. The opinions of any single advisor do not necessarily reflect the opinions of Argent Advisors, Inc.  No forecasts can be guaranteed.  Argent Advisors, Inc. does not offer tax, insurance or legal advice.  The information contained in this column should not be construed as a substitute for personalized investment, tax, insurance or legal advice.


Argent Financial Group

Celebrating its 30th anniversary in 2020, Argent Financial Group (Argent) is a leading, independent, fiduciary wealth management firm. Responsible for more than $30 billion in client assets, Argent provides individuals, families, businesses and institutions with a broad range of wealth management services, including trust and estate administration, investment management, ESOPs, retirement plan consulting, funeral and cemetery trusts, charitable organization administration, oil and gas (mineral) management and other unique financial services. Headquartered in Ruston, Louisiana, Argent was formed in 1990 and traces its roots back to 1930.

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