Reply to How do you feel about making your kid get student loans?

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]I showed my kids how taking out the subsidized loans helped their credit. They did so. I'll pay them off three months after graduation. When they'll have credit at 720plus.

They've also had Roths since they were babysitting at 13/14 years old.

I'm big about financial literacy [/quote]

That's a lot to pay for credit. I'd rather my kids just build their own with responsible use of credit cards - free way to build credit.
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It’s an interest-free loan. It costs nothing. In fact I get to invest that cash instead of spending. Clock doesn’t start on govt loans til graduation. 
[/quote]

Way back in the day, I went to grad school after undergrad.  But company paid and I collected 45% of my salary (so way more than I needed to live).  So I saved, saved saved, then saved some more during my 6 months out of grad school.  Easily had enough to pay off my federal loans before any interest accumulated.  (back then it was ~$12K total).   But it does help to build credit.

The way our stupid credit system works, is if you don't have loans/installment payment/mortgage or rent, you actually take a hit on your credit score (ask me how I know).  So for a kid starting out, you build way more credit from paying off a loan than from paying your CC monthly.  [/quote]

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