Reply to As schools near $100K/year when will that affect the pool of students?

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[quote=Anonymous][quote=Anonymous][quote=Anonymous]Debt is OK

Rich people have debt, big corporations have debt, US Government have huge debt

Important thing is cash flow during and especially after graduation.

[/quote]

Debt is ok in some circumstances, but most college students cannot handle much more than the $27K max of student loans.  That's why the limit is set.

Yes, if you plan to be an engineer then having a bit more debt might be doable.  But what if your kid can't hack that and switches to a psychology major and only makes $45K in their first job?   Do you really think they can handle helping you with $100K in loans?  
100K in debt paid over 10 years at 8% (which is low for what PPL would be currently and the interest starts immediately, not after you graduate) is over $1200/month.  Is it really worth it to saddle your kid with $1200+ every month for 10 Years?  Sure they might manage, but they likely wont be saving for retirement, thus missing out on the opportunity to start early (my kid without loans will likely have enough saved by age 30 to have $3M at retirement if they never saved for retirement again---that is a huge amount that is largely so high because they started early, not because they are investing so much, compound interest is a neat thing).  They likely will still be renting at age 30 because they are funneling all extra money into the student loans.

Versus finding a school where they can cash flow and take $27K in loans with a payment of ~$275/month.  Much smarter choice IMO.

We have a love of debt in this country and it puts many with financial issues.  Goal should be to attend college with minimal debt.  Search and find where that is for you and your family.

Most parents who take PPL (and can't afford them, which is 90%+) typically expect their kids to take the loans over when they graduate.  But most 18yo do NOT really understand the financial implications of what that loan will mean for the next 15 years to their financial well being.

[/quote]
+1 my niece chose the large in state public with merit over the more elite SLAC.  She said it was the best decision ever. She is about to buy her first condo whereas her friends are still struggling to pay their student loans.

My DC had this choice, and they chose the in state public with merit after speaking to my niece and crunching the numbers for a $180K loan, as a CS major.  The money we save will go into DC's IRA eventually, and it will be five figures, and we can afford to pay for DC's car after graduation as a gift.  [/quote]

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