Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I really hope no one is doing this.

Tons of donut hole families pay for college primarily through loans. Both my parents and DH parents funded our educations this way.
They paid off the loans within a few years of their kids’ graduations.

The donut hole is a myth

Nice to know I’m a mythical creature now. HHI finally topped 200k when kid was in high school.

Anonymous wrote:Donut hole is like this - yes, middle class people making 200-300 K can in theory save enough for a few kids to go to "private" college (but considering their income, is it wise to shell out so much on undergrad for a private when the money can go so much further in other scenarios (such as choosing public for undergrad, then having more to help with grad school?). It kills me when I hear parents say stuff like "grad school is on them" - I paid for Oberlin or whatever - and then they talk about how poor Johnny is and all of his debt. Yes, I'll say it - you are screwing your kid if they come out of Medical or Law school with $200,000-$300,000 in loans, and god forbid you saddle them with big loans for undergrad. You want to retire eventually right? There is no shame in this sort of reasoning - I wish people would stop using the term donut hole to justify why they "can't" pay for this or that, and being so defensive about it. It's a lot of money to shell out and in most cases does not make sense if your means are limited in the long run. Call it what you want, but practicality about college and grad school enabled our kids to come out of two top-10 grad programs debt free thanks to excellent grades, merit scholarships and some long term planning. They listen to what their friends are dealing with and are very thankful to have freedom and flexibility in their life choices vs. being shackled with debt.

Good to know People making 200-300K are middle class. I thought they are poor!

I think this is crazy. Why are the parents taking out loans instead of the student? DH had one of these parent plus loans and it was really annoying. The rate was sky high. He went to a state school and basically slummed it through college, plus worked prestigious high paying jobs during the summers. He actually shared a bedroom all 4 years plus shared a bathroom with like 5 guys. But his parents didn't save anything or give him anything for college, so he had to take out a parents plus loan.

His job eventually repaid his student loans, but not his parent plus loans. Those couldn't be rolled in.

No, not everyone on DCUMs is rich - we are a family of 5 and our HHI is 110K.

Two of our adult siblings told us that they took out private loans through their Discover credit card for their kids to pay for college (or something like that - it was definitely Discover). So yes, it's a thing.

But we haven't taken out private loans and don't plan to. We have two in college, one in high school. One of our kids goes to our state school and another goes out-of-state to a public university that offered enough aid to make it cost the same as our state school. Both kids will graduate with around 30K in student loans which we plan to pay off for them or at least significantly help them pay off. We aren't comfortable taking on more debt than that.

Both of our kids turned down offers at higher ranked colleges (top 25) that would have cost more. We feel that our kids each picked the school that hit that sweet spot -- good education, affordable, good location.

This is just not the crowd. Does college confidential have a parents thread about paying for college?

Everyone on dcum is rich and has been able to max 529 contributions since their snowflakes were fetuses. In fact, most are worried about oversaving in their 529s, not having to take out loans for college.

Donut hole is like this - yes, middle class people making 200-300 K can in theory save enough for a few kids to go to "private" college (but considering their income, is it wise to shell out so much on undergrad for a private when the money can go so much further in other scenarios (such as choosing public for undergrad, then having more to help with grad school?). It kills me when I hear parents say stuff like "grad school is on them" - I paid for Oberlin or whatever - and then they talk about how poor Johnny is and all of his debt. Yes, I'll say it - you are screwing your kid if they come out of Medical or Law school with $200,000-$300,000 in loans, and god forbid you saddle them with big loans for undergrad. You want to retire eventually right? There is no shame in this sort of reasoning - I wish people would stop using the term donut hole to justify why they "can't" pay for this or that, and being so defensive about it. It's a lot of money to shell out and in most cases does not make sense if your means are limited in the long run. Call it what you want, but practicality about college and grad school enabled our kids to come out of two top-10 grad programs debt free thanks to excellent grades, merit scholarships and some long term planning. They listen to what their friends are dealing with and are very thankful to have freedom and flexibility in their life choices vs. being shackled with debt.

Op has not mentioned how much $$ they plan to borrow. Some amounts are manageable, while others are extravagant and not always worth it. In my humble opinion, I would borrow for tuition ONLY and at a state school. Room and board is not worth borrowing. R & B can cost $10-15K per year.

Anonymous wrote:

Anonymous wrote:I really hope no one is doing this.

I would rather send kid to CC for two years and have them transfer to 4-year if I was in this situation.

Have a car payment? Why not drive an older used car?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I really hope no one is doing this.

Tons of donut hole families pay for college primarily through loans. Both my parents and DH parents funded our educations this way.
They paid off the loans within a few years of their kids’ graduations.

There are no donut families. They code not to save. Bad move.

Oh please. Have you never had unexpected expenses? A job loss that drained your savings? In our case, my dc needed tons of therapies (speech, ot, etc) that were not covered by insurance. DH and I used to joke that we had already paid for college by the time he was 8. Then he ended up going to a special needs private for a few years and dh's income plummeted during the 2008 financial crisis. We have rebounded quite well (we are very very lucky) and can pay for college but not everyone is as lucky as we are so I have compassion for those that can't pay and don't say that it is their fault that they haven't saved. However, I do not believe in excessive borrowing for "dream" schools as I believe there are lots of places that students can succeed.

The number of people in your scenario is minimal and not large enough to make a whole category called ‘donut hole’ families.

Anonymous wrote:

Anonymous wrote:I really hope no one is doing this.

Tons of donut hole families pay for college primarily through loans. Both my parents and DH parents funded our educations this way.
They paid off the loans within a few years of their kids’ graduations.

The donut hole is a myth

Anonymous wrote:

Anonymous wrote:I really hope no one is doing this.

We are selling our house instead in this crazy market

And no, we will not be turning down HYPSM. It will pay for itself eventually.

Where are you gonna live though? Downsize or sleeping on the street?
Alternatively, you could take out home equity loans.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I really hope no one is doing this.

Tons of donut hole families pay for college primarily through loans. Both my parents and DH parents funded our educations this way.
They paid off the loans within a few years of their kids’ graduations.

j

I don’t know how old you are, but things have changed a lot since I went to college. It got way more expensive relative to income and also there are now much more opportunities in need and merit based aid. Two of my kids are in college now, and among their circle there is no one whose parents are paying for college primarily through loans. Some loans - yes, but otherwise it’s savings, cash flow and merit aid, some need based aid too.

Well if you can pay for college with a loan at a low rate, say under 5%, technically you are making money because your investments should return a bit more than 5%. I plan to pay for my kids college with a HELOC, which right now I can get at 3.5%. Each year I am therefore earning a couple percent spread on my investments. Would be dumb to pay cash

The banks are getting out of HELOCs, so you may want to do a cash out refi instead, as we did.

Anonymous wrote:

Anonymous wrote:I really hope no one is doing this.

We are selling our house instead in this crazy market

And no, we will not be turning down HYPSM. It will pay for itself eventually.

Keep telling yourself that.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I really hope no one is doing this.

Tons of donut hole families pay for college primarily through loans. Both my parents and DH parents funded our educations this way.
They paid off the loans within a few years of their kids’ graduations.

There are no donut families. They code not to save. Bad move.

Oh please. Have you never had unexpected expenses? A job loss that drained your savings? In our case, my dc needed tons of therapies (speech, ot, etc) that were not covered by insurance. DH and I used to joke that we had already paid for college by the time he was 8. Then he ended up going to a special needs private for a few years and dh's income plummeted during the 2008 financial crisis. We have rebounded quite well (we are very very lucky) and can pay for college but not everyone is as lucky as we are so I have compassion for those that can't pay and don't say that it is their fault that they haven't saved. However, I do not believe in excessive borrowing for "dream" schools as I believe there are lots of places that students can succeed.

Anonymous wrote:

Anonymous wrote:I really hope no one is doing this.

Tons of donut hole families pay for college primarily through loans. Both my parents and DH parents funded our educations this way.
They paid off the loans within a few years of their kids’ graduations.

There are no donut families. They code not to save. Bad move.