Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I don't understand how a parent can "make" their child take out loans...?

They refuse to pay, like my parents. Not only did they refuse to pay; they refused to fill out the FAFSA for me.

But they didn't MAKE you take out loans. You could have attended a community college. You could have waited to attend until you had money saved up. But just because a parent does not pay does not mean their child is FORCED to take out loans. Sheesh.

Free agency. It's a real thing.

This is ridiculous. Not paying is one thing, but parents who refuse to fill out the FAFSA are completely screwing over their kids. This is not about “choosing” to be an adult. The government deems an 18 year old to be a dependent for college tuition purposes and their parents’ income is attributed to them, whether they think you’re a “free agent” or not. If the student is under 24, and a parent refuses to fill out the FAFSA, they are ineligible for aid, and it is difficult to be declared independent. The criteria are things like: your parents are incarcerated, you don’t know where they are, you’ve left home due to abuse….

Yes, you can wait until you’re 24 to go to college, but that doesn’t mean that your parents aren’t absolute jerks.

+1 awful. Why do people like this even want children?

Anonymous wrote:This is a 5%-er or maybe 3%-er topic.
So much of the rest of us don't have the capability to full pay.
Those kids are glad to go to college and taking out loans is part of that for them. Beats working 40 hours a week and carrying a full load or taking extra years to finish. They also know that parents need to save for their retirement so as not to be a burden later and to preserve the nest egg by NOT co-signing.
Lucky those for whom this is a question.

My "slightly above average kid" got into 2 state schools (#2 and #3, after the flagship). Total costs were $23-25K. My 3.5UW/No AP/1200 kid got $4K in merit from one and $6K from the other. So lets assume $5K and now costs are $20K. Minimum wage is over $15/hr. My kid can easily earn $15K in a calendar year (full time for summers and breaks, 10-12 hours PT during school year). There is ~$5K remaining. I would hope parents can assist with that, and if not, you are eligible for subsidized federal loans.

As a parent, I'd find a way to earn an extra $500/month to help my kid, if I haven't saved anything for college. But that is not many on DCUM.

Anonymous wrote:What if merit isn't enough? How are you handling it?

Community college for two years?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote: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

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.

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.

+1

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.

Anonymous wrote:Be aware that all schools do not offer RA’s full coverage of room and board. My DS was at a SLAC and received a discount on room only.

Either way, that is over $10-12K at most schools. And they can still work summers and breaks at another job to earn another $10K+.

Absolutely not. Find an affordable in state option or go to CC for two years.

Anonymous wrote:

Anonymous wrote:We saved enough for our kids not to need loans, but if it had been necessary I would not have been averse to them taking out a modest amount up to the federal cap (about $27K total IIRC).

I would never take out a Parent Plus loan for education however.

I'd say exactly the same. Plus your DC can earn $5-$10k between the school year and summer to contribute. Getting a job as an RA beginning sophomore year is not that difficult and covers full room and board.

It actually is difficult at many schools. But I agree, your kid can easily earn $10K+ over the year, more likely $15K+ (summer and all breaks FT, and PT during the school year).

Anonymous wrote:

Anonymous wrote:You pay

Everyone may not have the same financial situation, so that may not entirely be possible.

IMO, beyond the federal loans of ~$27K total, you should not be taking parent loans. There are ways to get a good education without doing that.

State school, federal loans of $5.5K/year, kid works to earn $10K+ (entirely possible when min wage is over $12/hr), and you search for merit. Most states have schools at $25-30K. A good student can get $5K+ merit many times. Then parents owe $5-10K/year.

If that is "not affordable" then you do CC while living at home, and then transfer. All the while working to earn $10-15K/year (If I could earn $5K+ in the summer while getting paid $4.25/hr, most kids can earn up to $15K in a year with a PT job during the year, FT during all breaks).

But what you don't do is put a kid (who comes from a family that cannot afford to pay $5-10K/year for college or hasn't saved it) into massive debt. Not worth it

Anonymous wrote:Nothing wrong with having them have a little skin in the game.

+1

For me, it was a priority from the time I knew I wanted to have kids to ensure I had enough saved so that they didn't need loans. That made me address the issue quire young. After paying off my loans (college and law school) I saved aggressively and stayed at a law firm about 2-3 years longer than I otherwise would have to save for future kids' college. So in my case I would be very much opposed to their taking out loans because they can be so debilitating. But I also planned and saved so that that we'd never need to reach that question. At the same time, our kids have been blessed with high academic and intellectual talent, and very strong work ethics. One is a their first choice top college and the other is in the process of applying. If they were slackers or needed skin in the game financially I might have a different approach.

Nothing wrong with having them have a little skin in the game.

Anonymous wrote:Mine took out a subsidized loan for the last two years. I paid them off by the first payment 6 months after he graduated. I needed it because the tuition kept going up so much each year.

Similar situation here.

In-state direct costs for UMD are about $28k. That's a pretty good deal versus their peers. Most college bound families in America cannot cover even this cost without their kids working and/or taking loans.

Anonymous wrote:Be aware that all schools do not offer RA’s full coverage of room and board. My DS was at a SLAC and received a discount on room only.

I was an RA at Purdue and they paid OOS tuition & fees, room & board, plus a small stipend. You had to be at least 21. Best deal in the world. I don't think they are still that generous.

Full pay, partial pay, loans or no-loans does not matter that much.

What matters is that parents should save for college and future in all seriousness as a duty towards their children.

Another thing is that parents should create a supportive, loving, functional and intact home for their children. That is the best predictor of how well the children will do.