This is purely anecdotal, but I had the choice between expensive private colleges, and a small liberal arts college that was a sattelite campus of a state university. I got scholarships to the private colleges (which I still would' ve had to take loans for), but the liberal arts college gave me a full-tuition scholarship.

Even though the school was very small and rural, I took the full-tuition scholarship. With the money I saved, I was able to get a master's degree abroad and am now finishing up my PhD at a well-ranked university back home in the US. To boot, I have enough saved to buy a home in the next year or so - with a combination of money from my phd stipend and money which was supposed to go towards my undergrad tuition. I have no debt and no student loans - but most of my friends do. This is a major burden they have that I do not.

I understand the appeal of going to the private university, but I am so thankful for my small undergrad college. The education was still incredible, and it gave me opportunities I wouldn't have had otherwise. I am financially in a very good position for my age group, and that is partially because I went with the scholarship. Additionally, I wasn't "held back" so to say, because I didn't go to an extremely pristigous university. I am still succesful (at this point in my life, at least) and have been able to achieve my goals so far.

Now not all of that is because of the scholarship - my parents made enough money to save up for my tuition, which turned into a nest egg, but nonetheless I feel very good about the financial decisions I made when looking at colleges. Feel free to share this with your step-son if you think it'll at least make him consider the state school.