<p>I consider us very lucky regarding this matter. However, we tried to choose financially feasible options from the beginning. Our son graduated HS with 4.3 GPA, but had to start in CC for financial reasons (we have a very good CC in the area). There was no way we could afford to pay for all four years of his college. Taking overload in CC plus some AP credits from HS allowed him to transfer to UCI after one year in CC. He got into Cal too as a transfer, but chose UCI for two main reasons: housing in Cal was twice more expensive and classes for his major (CSE) were harder to get, which might have made it impossible to finish in 2 years. We paid for his junior year in UCI almost in full (he got a couple of minor scholarships). It was hard, but I took a second job instead of taking loans. In his senior year he found a paid internship and was able to cover his living expenses; we covered his tuition. He graduated in three years after HS with no debt, is employed full time and independent. Our daughter is attending expensive LAC (finished her 3rd year). Were really grateful for her schools generous fin aid. Loans are capped, and she will graduate with $3000 debt. $1000 in Perkins replaced her work-study for the semester abroad her junior year and she got $2000 in federal direct sub for her senior year. Im a little worried though about the debt she might have to take for graduate school shes thinking about. She says though shes going to consider only funded options. I think that no education is worth going into unmanageable debt!</p>
<p>Our S got a significant merit award that made it possible for us to make up the difference so he could attend the school he wanted. Our D attended CC for 3 semesters and transferred to make things work financially. I have also been drawing a salary to contribute toward their expenses and we were able to save some funds as well. This is allowing us to have our kids graduate w/o debt, tho we’re not sure about grad school which D is now considering as she enters her SR year.</p>
<p>Blindly expecting things to work out is NOT any sort of financial plan, even if you know others who appear to have done son. </p>
<p>Remember, those who fail to plan, plan to fail!</p>
<p>I consider myself very fortunate when it comes to paying for my college. The university gave me a merit scholarship that covered all of my tuition. I got other free money, such as local merit scholarships and a small grant from Uncle Sam (so basically the Chinese government’s money). Those two sources cover all of my room and board except for $50. Not too shabby. I will cover my other stuff (books, living expenses, etc) from savings and a work study job. </p>
<p>That being said, I was extremely lucky. I would not want to take out huge loans since I already know that I will not be making big bucks in my chosen field. When I was in my senior year of high school, I heard many students talk about how they could not go to their dream school because of the cost. Many went to different schools, mostly the local community college. One of them is going to a community college for a year and then plans to transfers in to his desired school. I hope that works out for him, but it sounds like loans will still be needed. Student loans can be scary.</p>
<p>Ok, but re University of Illinois barely gives out money to it’s incoming students. How do the thousands of kids that go here handle it? I don’t know the answer to that and neither do you, but it DOES work out. I realize you probably won’t like this reply, but sooo many people do it that it HAS to be possible"</p>
<p>The percentage of students who take out $100,000k over four years to attend UIUC is tiny, and I mean VERY tiny. The reason for that is simple. No bank in its right mind will loan it to them even if they wanted to. The PARENTS might take out the loans (if their credit is good enough), or are required to co-sign for all the loans.</p>
<p>Other than that, it ISN’T possible. </p>
<p>Now if you work in the summer and save $3k, and work during the school year (20+ hours a week) you might come up with another $5k, but that still puts you $60k in the hole. Not good. Not good for you (even if you can find someone fool enough to give you the money). </p>
<p>Most of the thousands of kids at UIUC have, on average, well less than $24k in loans over four years (the reason I know that is the average loan indebtedness of the average recent 4-year college grad is $24k (average $6k a year), and that includes those who went to for-profit colleges where indebtedness tends to be significantly higher. So figure $20k ($5k a year.) The rest is made up in parental contributions, parental loans, gifts from relatives, summer jobs, on-campus work, student savings, and scholarships. </p>
<p>What you are doing, in contrast, and DIFFERENT than most other students, is taking out $23k in ONE YEAR (which is more than what most students will have in four.) Don’t do it.</p>
<p>“LOL - DougBetsy - my D IS a theatre major and we are taking out loans for her to attend NYU because it’s the best possible place for her to maximize her potential in the industry. The program she is in is multi-disciplinary so she has lots of options for employment in the industry from the technical side to stage management to acting/singing/dancing. . . our end-debt will be ahem substantial. She will be responsible for her loans and I will be responsible for mine except if she makes it big on Broadway, she will pay them off for me! She is bright, ambitious, hard-working and talented but we still know this is a risk…” </p>
<p>Wow - that is a very big risk. NYU (55K per year?) should provide more debt-free FA.</p>
<p>Well, what Us SHOULD provide is moot; folks need to deal with the reality of what IS provided and available, choosing from among the options that work best for the parties involved.</p>
<p>We are very glad that our D is graduating w/o debt because she is in cinema and job prospects vary considerably–another known, but smaller in our mind because there will be no interest and loan repayments to deal with. D will graduate with experience in all areas except the acting/singing/dancing but will do shooting, lighting, production design, etc. Is NOT interested in being in front of the camera. She will also be trying her hand at scriptwriting and more art.</p>
<p>[My</a> degree isn’t worth the debt! - Erik Solecki (1) - CNNMoney](<a href=“http://money.cnn.com/galleries/2011/news/economy/1106/gallery.student_debt/index.html]My”>My degree isn't worth the debt! - Shane Dixon (1) - CNNMoney)</p>
<p>Aklauss: Stop, look and listen- you are being given very sage advice here. You want what you want, so you believe what you want to believe. I’m not being harsh, your parents should be telling you this information. Perhaps they are but you still want to believe you can have this experience at UI. </p>
<p>Your debt will be way to high, and tuition is only going to increase. Watch the CA budget in the next month or so, UC is saying with cuts, tuition might increase 32% for next year. Last year they increased it 2x in one year. Think about it. </p>
<p>People do not tell you the truth about their financial situation. Not at your age and not at mine either. Not so long ago, I remember watching the spending frenzy in our affluent suburb, and thinking how are they all doing it? I made a lot of money so I knew what it costs AFTER tax and it did not add up. I was puzzled for years, but the party continued. Right up until it stopped, after the bills came due, the home equity was gone and their house payments were more than their monthly take home pay by this point. Sure, they lost their house, went Bk- but to a one, the adults were stunned they had no home, no credit, they had to move their kids out of their schools and could not rent in most cases. They acted like someone played a trick on them. No, they spent all of their money and other peoples too. And they had a good time while it lasted. Now, they can’t put their kids through school. Why? because they still make just enough not to qualify for aid. How do I know this? Well, through talk but also foreclosure and bankruptcy are public records and many services give the information for a small fee to Real Estate agents and investors. Bing! there is another family I know, with four loans on their house- up for auction.</p>
<p>Sad stuff huh? Well, the gov’t really fixed you kids- no way out for you, no bankruptcy for student loans. Not fair at all- talk about predatory lending practices! On our most valuable and vulnerable citizens…our future work force; our youth.</p>
<p>Don’t take out the loans. Please.</p>
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<p>I agree with the advice to the OP. However, once a student starts at UI (or any Illinois public) that tuition is guaranteed for nine semesters. </p>
<p>Sent from my SAMSUNG-SGH-I897 using CC App</p>
<p>Our 3 had the basic unsub Stafford for their ‘skin in the game’.
We decided to pay accruing interest while they were in school.
If you make those interest payments within 120 days of disbursement, the amount paid comes off the principal.
It was a great tactic to reduce their debt loads.
mominva can you explain that a little more? Are you saying that if you pay interest in advance, you not only don’t increase your principal by the amount of the interest, but you decrease the principal? How much interest do you have to pay (a year’s worth? more?)</p>
<p>So maybe I wasn’t clear. We opted to pay accruing interest on the unsubsidized loans, but if I made those payments within 120 days of disbursement, the amount I paid was deducted from the principal. So if student had a $1000 balance and owed $68 in interest, if I paid that $68 within 4 months (120days) of disbursement, the principal was now $932 and future interest was based on that amount. </p>
<p>federal lenders cannot charge prepayment fees on stafford loans, and if you pay it off within 120 days from the time it is disbursed (sent to the school), they will retroactively fix your fees and interest so you only pay interest on the amount that is left at the end of the 120 days…</p>
<p>Aklauss - we live in Illinois so I’m familiar with the ridiculous cost (for a state school) of UIUC. I also know a LOT of students who attend UIUC, as it is the most common destination of kids who graduate from my kids’ high school. However, I do not know a single person headed to UIUC who will have anywhere near the debt burden you are contemplating. If my D goes there, we (parents) will be paying for it. The parents of most of the kids I know who attend UIUC are paying a not insignificant portion of the cost - either from college savings, current income or PLUS loans that the parents will repay. Some kids will end up with $25K or so in total undergrad debt, but NO ONE I know will have $100,000 in debt for UIUC undergrad. And even if there are others who are taking on that unreasonable level of loans, that doesn’t make your situation any better. The herd mentality doesn’t help to pay off your loans or improve the poor financial situation you’re likely to be in for many years to come. From whom are you borrowing your $23,000 this year? Nothing beyond the Stafford limits will be government guaranteed, and I cannot imagine any bank lending money that is not government guaranteed to a college undergrad. Are your parents co-signing? If they are, and they’re not planning to help with the repayment, I think they’re doing you a disservice. In any event, best of luck.</p>
<p>Mini’s CNN link above is SOBERING. Read all 7 students. There are a million more out there just like them.</p>
<p>Mini’s link is something. One young man borrowed more than his COA would have been: $80K for a SUNY Albany degree? </p>
<p>I find myself swinging wildly between feeling bad for these kids and thinking: “How on earth could you be so dumb and even get IN to a college?”</p>
<p>Even as an ignorant 17-year-old, I did not want debt. Of course, perhaps the biggest problem of all is that our parents generally saved for what they wanted and then bought it where the youth of today have parents who charge first and pay later. It’s a whole different attitude about paying for what you need/want.</p>
<p>Most parents seem to start saving for college to late.</p>
<p>Prayinglady…You have said what I have said many many times on this forum but I will be surprised if you don’t get hammered for it. You are right that so many parents go on expensive vacations, buy new cars and renovate their kitchen and bathrooms all the while their kids are taking out loans. I have seen this so many times…makes me crazy that parents could be this selfish.</p>
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<p>Some of us did not earn enough incomes to save for college.</p>
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<p>If the parents are cosigning, but not planning to pay for the loan, they’re doing themselves a disservice. If one cosigns a loan, one is liable for paying it back. That’s what it means to cosign. If aklauss doesn’t pay back the loan (and he/she won’t be able to, because he/she won’t be able to afford it) the bank will go after his/her parents.</p>
<p>Our D just recently graduated with about 18k in sub-stafford loans. We took out an additional 16k to cover the balance. I remember the sticker shock of facing 26k per yr. It can be scary especially if you haven’t planned for it. After we found out what scholarship money she was to receive a financial plan became feasible. I’m just glad that through her hard work she was able to get a full ride at grad school. She was excepted into several good programs but the offers varied greatly w/ regards to compensation.</p>
<p>About starting to save too late…Who could have predicted that tuition would skyrocket the way it has? We certainly didn’t. We have enough that we could pay cash, but it just doesn’t make sense to drain the retirement/whatever we have saved for savings. Even if people have $1 million in the bank does it make sense to sink half of it into college costs for two kids when retirement is looming. To me it makes more sense to choose the college that is more reasonable in cost, continue to save and leave the kids some $$ if there is any left. Paying full freight at say Georgetown, where COA was $60K two years ago–and where DD was accepted–would impact retirement savings.</p>
<p>So I don’t think it is selfish to save for our retirement. The kids will not need to support us. I also don’t think that it is selfish to update the house; it will be more valuable when the kids need to sell it and split their share. Not going to the uber expensive school and avoiding debt should pay off for our kids–and us.</p>
<p>I went to a LAC in the 70s and state U for med school, graduating in 80. I had some merit aid for the LAC, bringing the cost to at or less than state U for undergrad. The rest was financed with loans. I married a social worker with a BSW from a state U on loans. We married in 80 also. Call this year 0. We paid the loans off in about 10 years (including payments during residency). We were able to afford a small home in year 2. We started a family in year 10, yeah, we were a bit older. We were not able to save anything during residency, and a little after that. After student loans came practice loans. Being self-employed, the only retirement savings is what I contribute. Any match is still my money. So we started saving for retirement early. And we start putting some money away for college. </p>
<p>Fast forward to D1’s sophomore year in HS. H stayed home with the kids, and never returned to the workforce due to illness/disability. We have paid off student loans and practice loans, and have been saving for retirement and college. But I was SHOCKED to learn that tuition for a LAC has gone from $4000 a year to $40,000. Yes, it went up TEN TIMES. Add room and board. Talk about sticker shock. Salaries had not gone up anywhere near that amount. </p>
<p>Thankfully, my kids did not care for the small LAC environment. So we are able to cover tuition, room and board at state U’s out of prepaid tuition plans (we also prepaid one year of dorm), Bright Futures, some merit/scholarship money, and a little out of current income. We have 529 money for some grad school/professional school expenses. We will have D1 take out the limit for subsidized Stafford loans if her Master’s program is not funded (her field is often NOT a funded Masters) for two years and cover the rest with 529 and income. D2 is aiming for vet school, and I hope to cover all but $25K of sub-Stafford with 529 and income. </p>
<p>It was not easy paying off our own student loans, practice start up loans, saving for retirement and trying to save for 2D’s college expenses during a time tuition skyrocketed. Throw in husband illness, not having a second salary, and medical expenses… I cannot imagine sending two off for four years at 50-55,000 a year. Nor would I let them try to borrow that kind of money. </p>
<p>We live comfortably. And I work VERY HARD. I drive an '03 VW bug, we have been to Hawaii once and a grad trip to Paris/Rome once. No fancy cars, few nice vacations. Same home for 27 years, with some upgrades and remodeling. And we will retire late but comfortably. Kids will graduate with loan debt of $20-25K each if we work it right. Maybe less. </p>
<p>The morale of this story is that you have to watch how much you take out in student loans, as it will effect even the NEXT generation–your own kids. And remember that you may need start-up money for your career in addition to student loans. The money you borrow now with no worries will create worry for decades to come. There is a price to pay. I have no regrets, and my loans worked out well. But with the price of an education these days, if you plan on needing loan money for grad/professional school, finish undergrad LOAN FREE. Forget prestige. It may not be worth it in the long run.</p>